Sometimes contractors find it hard to Estimate the Cost of a Commercial Building. Cost prediction of a commercial building is more difficult and time-consuming than a small-scale construction project. The reasons are obvious. Commercial buildings are much larger with many factors to account for, they are more intricate and have higher stakes.

Even professional contractors can make mistakes in the estimation process.

One can outsource cost estimation work to Certified Cost Estimating Services such as Bidding Estimates. Consequently, time management will increase and the chances of winning the bid also rise.

Factors Affecting Cost

Here are some major elements that impact the construction cost of a building:

• Size

• Complexity

• Location

• Fluctuating Market Prices 

• Type of Material Chosen

• Worker Wages

• Permit Cost  

• Time Taken to Complete the Project 

• Personal Preferences 

• Building Regulations and Local Codes 

Accurately Estimate the Cost of a Commercial Building! 

1) What are the Project Details?

To precisely estimate the cost of a commercial building, it's vital to become familiar with the project. Go through the blueprints carefully and analyze them in detail. One can also conduct a site visit.  Most contractors usually just skim through the requirements but it's crucial to learn about the details as much as you can.

• What are the goals of the building?

• Are there any special requirements?

• How much time do you have?

• What is the current condition of the site?

2) Material Takeoff 

Material Takeoff is all about calculating the number of materials needed in the project. Tka precise measurements and dimensions of the blueprint to accurately quantify materials. Some basic materials include:

• Concrete 

• Lumber 

• Metal

• Drywall

• Cement 

• Paint

Professional Commercial Building Estimating Services typically use advanced takeoff software to accurately quantify the materials. The software helps to save time and also provides real-time zip code-based pricing which increases accuracy. 

Some examples include:

• Planswift 

• Bluebeam

• Quest Estimating 

• RS Means

• STACK

• On Screen Takeoff 

3) Material Cost

The next step is to calculate the material cost. If you don't have access to real-time pricing software then don't worry. Another way to get accurate pricing is to visit the marketplace. An analysis of the current market condition will give you an idea about the material expenses.

4) Estimate Labor Cost 

Worker wages or labor costs shouldn't be estimated. They can make up about 25% of the total project cost! Labor cost in commercial products is generally higher because there are more workers required and the time taken to complete the project is longer.

There's a very simple formula to estimate the cost of commercial building labor and that is multiplying hourly wage with the time taken to complete the project. 

5) Equipment Cost 

Equipment cost can be divided into 2 categories I.e purchased cost and rental cost.

Commercial projects often require heavy machinery, especially for excavation and grading. Therefore it's important to account for rental costs as well.

Moreover, some of the machinery can wear out over time, so maintenance expenses also need to be included. 

6) Overhead Costs

Overhead costs are also known as an indirect expense of construction. Some examples include:

• Administrative Cost

• Permits

• Utility Bills

• Legal Fees

• Insurance

• Marketing

• Transportation

Overhead costs can vary from project to project so you'll need to decide which one needs to be included in the project.

7) Contingency Plan

The best thing to do to safeguard the budget from cost overruns is to create a contingency plan. Construction Estimating Services like Bidding Estimate always include a contingency plan in case of unforeseen circumstances. It typically includes about 10% of the total project cost but it can vary depending upon the risk factors. 

8) Profit Margin

Don't forget to include your profit margin in the contract! Most contractors include an 8 to 15% margin in the budget. It can vary depending on the type of contract and construction project. 

Best Practices to Estimate the Cost of a Commercial Building

Here are some tips that will be helpful to estimate the cost of a commercial building.

• Instead of relying on manual calculation methods, try using cost-estimating software to increase precision

• Use historical data to analyze the cost of similar past projects but don't rely on it too much. Always do your calculations

• Do not take any shortcuts

• Familiarise yourself with local construction codes and regulations

• Rely on Commercial Building Estimating Services to create an estimate. It increases the chances of winning the bid and you get an accurate estimate without lifting a finger. 

Final Words

Accurate estimation can do wonders for a construction project. It improves project planning and streamlines the flow of construction. Moreover, it enhances decision-making power and collaboration among professionals. With the help of an accurate budget, contractors can improve their business and earn a good reputation in the construction industry. So estimate the cost of a Commercial Building by carefully considering all the factors!