Unsurprisingly, this is the first question we are ever asked by our prospective clients. This article gives you an amazingly simple tool to work it out.
The short answer is ‘well, it depends’. There’s no such thing as an average project because even the simplest build has so many variables. That isn’t very helpful for you though, is it? Don’t worry, we can talk you through how to estimate your ballpark construction costs using a basic formula.
You need to know whether your project is going to be affordable and justifiable before you spend time, effort and money getting plans drawn up and choosing your fixtures and fittings.
Last year, we were approached by a prospective new client, Mr X, who was looking for a project manager to oversee his project from tender right through to completion and, of course, we were only too happy to help.
Mr X was very excited about his planned new office. His architect had designed something beautiful for him. Breathtaking. Everything he had dreamed of. Unfortunately, Mr X and his architect had never discussed budget. Mr X had no idea what his new office might cost, so the first thing he asked of us was to estimate it for him.
We looked very hard at the specifications and researched the best value marble tiling and the cheapest gold taps (I exaggerate, but you know what I mean) but to build according to the plans could not be achieved for under £2M. Mr X’s budget was £500K. Needless to say, he was devastated and the project was canned.
We felt bad for Mr X. He knew what his budget was but his lack of previous construction experience meant that he had no idea that the office of his dreams was going to be unaffordable. Worse, he’d spent money on an architect who was more interested in catering for his every requirement, rather than designing something he could actually afford to build.
We want your premises to be perfect for you. That means that it needs to offer all the functionality you want but also fit your budget. Deciding what your budget should be must be done when deciding your brief but it’s hard to do that without plans and a quote.
Let us help. You can work out a rough estimate of how much your construction project will cost by finding a similar project in Spon’s Architects’ and Builders’ Price Book and multiplying it by the area you intend to build. Here are some examples from the 2019 edition:
Please remember that this is only a rough guide, and the eventual cost will be decided by any number of choices you make, but it’s a realistic starting point for establishing affordability.
You will almost certainly need to hire in some level of professional services and this should be included in your budget. If you only need a project manager, then you should expect to pay 1.5 – 3% of the total budget, depending on level of service required.
So, if you wanted a basic service for your basic office fit out, as in the chart above, you should expect to pay somewhere in the region of £6,800 for project management. The highest level of service for the business park office above would incur project management fees of around £272,000.
If, on the other hand, you need a full professional services team including architect, quantity surveyor, project manager, building regulations and specialist consultants, then you should expect to allocate up to 14% of your budget.
If you’d rather we did the sums for you, please click here:
If you know your project is going to be financially viable and would like to know more about our project management services, please click here:
Author
Elizabeth Hewitt
Director of Marketing at Iconic Project Management Limited. We specialise in retail, leisure and commercial construction: building or refurbishing your perfect premises.