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Construction Contracts
 9 Months Ended
Sep. 30, 2020
Contractors [Abstract]  
Construction Contracts Construction Contracts

Construction contract costs and estimated earnings in excess of billings represent reimbursable costs and amounts earned under contracts in progress as of the balance sheet date. Such amounts become billable according to contract terms, which usually consider the passage of time, achievement of certain milestones, or completion of the project. The Company expects to bill and collect substantially all construction contract costs and estimated earnings in excess of billings as of September 30, 2020 during the next twelve months.  
 
Billings in excess of construction contract costs and estimated earnings represent billings or collections on contracts made in advance of revenue recognized.

The following table summarizes the changes to the balances in the Company’s construction contract costs and estimated earnings in excess of billings account and the billings in excess of construction contract costs and estimated earnings account for the nine months ended September 30, 2020 and 2019 (in thousands):
 
 
Nine Months Ended 
September 30, 2020
 
Nine Months Ended 
September 30, 2019
 
 
Construction contract costs and estimated earnings in excess of billings
 
Billings in excess of construction contract costs and estimated earnings
 
Construction contract costs and estimated earnings in excess of billings
 
Billings in excess of construction contract costs and estimated earnings
Beginning balance
 
$
249

 
$
5,306

 
$
1,358

 
$
3,037

Revenue recognized that was included in the balance at the beginning of the period
 
—

 
(5,306
)
 
—

 
(3,037
)
Increases due to new billings, excluding amounts recognized as revenue during the period
 
—

 
7,237

 
—

 
4,256

Transferred to receivables
 
(468
)
 
—

 
(2,015
)
 
—

Construction contract costs and estimated earnings not billed during the period
 
215

 
—

 
624

 
—

Changes due to cumulative catch-up adjustment arising from changes in the estimate of the stage of completion
 
219

 
(152
)
 
657

 
(923
)
Ending balance
 
$
215

 
$
7,085

 
$
624

 
$
3,333



The Company defers pre-contract costs when such costs are directly associated with specific anticipated contracts and their recovery is probable. Pre-contract costs of $1.2 million and $0.9 million were deferred as of September 30, 2020 and December 31, 2019, respectively. Amortization of pre-contract costs for the nine months ended September 30, 2020 and 2019 was $0.7 million and $0.1 million, respectively.
 
Construction receivables and payables include retentions, amounts that are generally withheld until the completion of the contract or the satisfaction of certain restrictive conditions such as fulfillment guarantees. As of September 30, 2020 and December 31, 2019, construction receivables included retentions of $16.6 million and $9.0 million, respectively. The Company expects to collect substantially all construction receivables outstanding as of September 30, 2020 during the next twelve months. As of September 30, 2020 and December 31, 2019, construction payables included retentions of $18.6 million and $18.0 million, respectively. The Company expects to pay substantially all construction payables outstanding as of September 30, 2020 during the next twelve months.

The Company’s net position on uncompleted construction contracts comprised the following as of September 30, 2020 and December 31, 2019 (in thousands):
 
September 30, 2020
 
December 31, 2019
Costs incurred on uncompleted construction contracts
$
852,966

 
$
695,564

Estimated earnings
30,354

 
24,553

Billings
(890,190
)
 
(725,174
)
Net position
$
(6,870
)
 
$
(5,057
)
 
 
 
 
Construction contract costs and estimated earnings in excess of billings
$
215

 
$
249

Billings in excess of construction contract costs and estimated earnings
(7,085
)
 
(5,306
)
Net position
$
(6,870
)
 
$
(5,057
)

The Company’s balances and changes in construction contract price allocated to unsatisfied performance obligations (backlog) as of September 30, 2020 and 2019 were as follows (in thousands):
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2020
 
2019
 
2020
 
2019
Beginning backlog
 
$
193,742

 
$
178,632

 
$
242,622

 
$
165,863

New contracts/change orders
 
(12,461
)
 
22,054

 
43,469

 
73,250

Work performed
 
(58,590
)
 
(27,594
)
 
(163,400
)
 
(66,021
)
Ending backlog
 
$
122,691

 
$
173,092

 
$
122,691

 
$
173,092



During the three months ended September 30, 2020, the Company canceled a contract for the construction of a hotel due to the delay of the owner. The Company expects to complete a majority of the uncompleted contracts in place as of September 30, 2020 during the next 12 to 18 months.