What Will My Construction Project Cost?

We are always approached by many prospective clients who want to know exactly how much their construction project will cost before they sign anything or at least a ballpark figure. One of the biggest misconceptions is that architects should somehow know how much the project will cost to build. I am often left having to explain to them that until we create the plans and show them to a contractor, getting a realistic estimate will be difficult without plans. In this entry, I will try to explain the many variables involved in a construction project and why pricing it can be difficult especially without plans.

The best way I could explain costs to a client is to break down the basics of what it takes to build anything, mainly, materials, labor and time. For starters, we need to establish the scope of work, or what the construction will involve. We need to know everything that the client is looking to do to their property, inside and out. Once the scope is established we begin to design their project. This is where things begin to get complicated because the cost will now depend on the complexity and level of finish they want to achieve. For example: A very modern design with complex forms and high-end finishes will be dramatically more expensive than a more traditional design with modest finishes. However, in both cases the plans will dictate how much construction is to be built: how far, how wide, how high, what structure, what materials and what finishes. From these factors a contractor would be able to itemize everything and their costs to come up with a total cost of materials. Next he would add the cost of labor to construct, which in some cases may be a percentage of the cost of materials, like a 75% additional mark-up. Finally, he would add his fee to schedule, direct and pay all of the trades for the entire operation, his overhead and any other expenses. Typically, these are things that architects don’t usually handle and would not know the costs of materials and labor. It’s like asking the doctor who is treating you for a broken leg after an accident how much you can expect to win in a legal suit.

Once we explain all of these variables, the clients begin to realize that pricing a construction project is not as simple as they thought. One should always beware of unethical contractors they may have already contacted who give a “ballpark estimate” without plans, leaving themselves open to a bait-and-switch of biblical proportions. Now you are probably screaming, “So, then how am I supposed to get a realistic estimate!?!?!”.  Well, here are a couple of approaches that we like to pursue when working with a client.

  1. We can create the design drawings with just enough information to get a rough pricing estimate from a few contractors we’ve worked with closely and trust. In the drawings we ask them to provide alternate pricing for certain items which we call “wish list items”. This is so that if the budget starts to spiral out of control we can easily cut them from the scope, or we can keep them if the costs seem within budget.

  2. Again, we create the design drawings with enough information to get rough pricing, also with alternates. A construction estimator is then hired to give us pricing before we even approach any contractors. This way we can alter the design according to the estimator’s recommendations, thus saving the client thousands of dollars in the long term.

One thing to keep in mind when contemplating a construction project is the budget you may have imagined to be reasonable is usually unrealistic and way off by about 50% to 200%, depending on the person and their level of delusion.

A good way to gage the cost of your construction project is to ask a neighbor or a friend who has recently had a similar project what theirs cost. Just keep in mind, that they may have gotten a discount because either they are super handy and did some of the work themselves, their brother-in-law, Bob, was the contractor or any similar scenarios. So ask lots of questions.