DFW Commercial Construction Glossary
60 plain-language definitions of commercial construction and real estate development terms — from design-build delivery methods to SBA financing programs, project cost categories, and DFW zoning concepts.
Definitions are written for owners, investors, and tenants — not lawyers or accountants. When a term affects your project or financing, ask Pereff for the specifics.
A
AHJ (Authority Having Jurisdiction)
the city/county that permits and inspects.
Amortization
the payment-calculation period (e.g., 40 years).
As-builts
drawings updated to reflect what was actually built.
C
Cap rate
net operating income ÷ value; lower cap rate = higher value.
CDC (Certified Development Company)
nonprofit that administers the SBA 504 debenture portion.
Change of use
converting a building's occupancy type (often triggers added code).
Change order (CO)
documented post-contract change to scope/price/schedule.
Civil / sitework
grading, drainage/detention, paving, utilities.
Clear height
interior height to the lowest overhead obstruction (key for warehouses).
CMAR / CM@R (Construction Manager at Risk)
CM engaged early to advise, then holds construction at a guaranteed max price.
CO (Certificate of Occupancy)
city approval that a building can legally be occupied. **TCO** = temporary CO.
Commissioning
testing/verifying building systems work as designed.
Construction-to-perm
one loan/closing covering construction and permanent financing.
Contingency
reserve for the unexpected (often 5–15%).
Cost-plus
owner pays actual cost plus a fee.
D
Design-Bid-Build (DBB)
design fully, then bid, then build; three separate relationships, sequential.
Design-Build (DB)
one entity handles both design and construction; single accountability.
Design-Build-Finance
design-build plus integrated project financing (Pereff's model).
Draw schedule
staged release of construction loan funds against completed work.
DSCR (Debt Service Coverage Ratio)
net operating income ÷ debt payments (lenders want ≥~1.20–1.25x).
E
F
G
H
I
L
Lien waiver
waiver of lien rights upon payment; protects owner's title.
LTC (Loan-to-Cost)
loan ÷ total project cost.
LTV (Loan-to-Value)
loan ÷ appraised value.
Lump sum / stipulated sum
one fixed price for a defined scope.
M
N
O
P
Performance / payment bond
surety protecting the owner if the contractor fails to perform or pay subs.
Preconstruction (precon)
detailed budgeting, VE, scheduling, permitting strategy before building.
Pro forma
projected financial model of a development.
Punch list
the final list of items to fix/complete before the job is accepted.
R
Recourse / non-recourse
whether the borrower is personally liable beyond the collateral.
Retainage
% withheld from payments until satisfactory completion (often 5–10%).
RFI (Request for Information)
formal question from builder to designer to clarify drawings.
S
SBA 504
fixed-asset loan (real estate/equipment); bank + CDC + 10% borrower; fixed rate; owner-occupied.
SBA 7(a)
flexible SBA loan (working capital, equipment, real estate); variable rate.
SD / DD / CDs
Schematic Design → Design Development → Construction Documents (increasingly detailed drawings).
Shell (cold/gray shell)
bare building: structure, envelope, roof, maybe stubbed utilities.
Soft costs
design fees, permits, financing/interest, insurance, legal, testing, developer fee.
Submittal
product data/shop drawings submitted for approval before installation.
T
T&M (Time & Materials)
pay for labor + materials + markup.
Tenant improvement / finish-out (TI)
building out a leased interior for a tenant.
Term
when the loan matures/balloons.
TI allowance
landlord's contribution toward a tenant's build-out ($/SF).
Tilt-wall / tilt-up
concrete wall panels cast on-site and tilted into place (common DFW industrial/retail).
V
W
Y
Heard a term that's not here?
Commercial construction has more jargon than most industries. Ask Pereff AI to define any term in context — it knows the DFW market, current financing programs, and how each concept applies to your project type.