Estimating The Cost Of Conceptual Commercial Construction Construction Essay

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The purpose of the technical paper is to give of understanding conceptual construction estimating. This report will describe how to develop the project estimate from a limited amount of supporting resource and offer general methodology of applying research and estimating techniques to schematic design documents.

Main CSI Division:

Division One (1.4) General Construction Estimating

Specific Subdivisions:

Bidding Requirements (No Number)

Brief Description:

The description of a conceptual estimate can range from a feasibility study, which carries +/- 20% margin of error with regard to the actual project cost, to a complex conceptual design estimate, which only carries a +/- 6% margin of error.

The first step of conceptual estimating is defining a project's overall scope and cost. Conceptual estimates are based mostly on assumptions due to the limited amount of information provide at the time of the estimate. Project information can be derived from schematic design drawings, design narratives, Phase I Assessments, Geotechnical Report and by interviewing the client. The remaining assumptions are drawn from past experience on similar type construction and historical cost data.

Schematic design is to used to define the general scope, scale, functional relationship, traffic flow, and cost of the project components. The schematic design drawings are drawn to scale and with enough detail to communicate clear and complete design intent. The drawings will identify area allocations, organization of exterior and interior spaces, conceptual image and building massing, interior and exterior materials, with design narratives for structural framing, plumbing, mechanical, and electrical systems.


At this stage, the civil drawings show, in preliminary detail, location of buildings, roads, parking, and landscape elements. It should define property lines, preliminary grade elevations, existing utilities, proposed utilities, site drainage, storm system, detention, retention, parking spaces, easements, setback, and erosion control.

The floor plan shows structural grid, vertical circulation, core elements, interior partitions, doors, windows, and room labels. The floor plan also shows location of plumbing fixtures including drinking fountain, lavatories, urinals, water closets, showers, etc. including the location of the mechanical room and size. Identifying the mechanical room helps locating gas, water, electric, etc. service points for coordination between interior and exterior work responsibilities.

The exterior elevations will show exterior storefront, curtainwall, exterior materials, floor line, roof line, door openings, wall and parapets elevations indicated with dimensions.

Design narratives accompany the drawings include preliminary design information for structural framing, plumbing, mechanical and electrical systems. Electrical design narrative includes service size, voltage, number of feeders, whether feeders are overhead or underground, emergency power requirements, and power requirements for equipment. The structural design narrative includes structural framing system design, typical bay sizing, and description of the foundation system in accordance with geotechnical investigation.

Sometimes less information is provided. In this case an experienced estimator needs to be able to fill in "the gaps" in the scope of work. Having an estimator's with past experience on similar projects and historical data is necessary to providing a good conceptual estimate.


Method of Estimating

At Schematic Design, unit price estimating is the most common approach to estimate a project. The unit price is calculated using various units of measurement such as linear foot, square foot, cubic yard, each, tons, etc. The cost per unit is based upon historical cost from actual cost data from previous bids and/or from cost information obtained from the accounting department.

While this method is the simplest to perform, it has some disadvantages. Items can easily be overlooked and sometimes this method doesn't provide enough detail to compare with actual cost. Additionally, the client could request additional cost breakdown into material and labor. Or the client might ask for materials substitution costs. Each request is hard to provide when material or labor are not track separately.

Assembly estimating provides the best of both unit price and detailed estimating methods. Assemblies provide an additional level of detail that can be used to create proposals, project budgets, and purchase orders. To perform an assembly takeoff efficiently and effectively, estimating software capable of compiling both unit price and detailed information is required. Assemblies are several items combine in a single unit of measure. Each item in the assembly has several cost components including material cost, labor cost, equipment cost, subcontractor overhead and profit. Therefore material cost, labor cost, equipment cost, ans subcontractor overhead and profit can be updated and track independently of each other. Within an assembly, items are quantified in a relationship to the unit of the assembly. In the assembly estimating example found on page eleven of this report, several items make up the brick veneer with metal studs assembly. Please note, the unit for the wall assembly is shown as per lineal foot. Unit costs are shown for each item is in terms of square foot, lineal foot, cubic yard, and ton. Unit cost information is the historical cost date mention earlier. All items are then converted into a lineal foot unit of measure.


For example, the brick veneer is sixteen feet in height and historical cost per square foot is fourteen dollars. Then sixteen times fourteen equals two hundred twenty-four dollars per lineal foot.

Assembly estimating has the simpicity of unit price costing but is more accurate with greater detailed. Assemblies require planning and set-up ahead of performing an estimate. For conceptual estimates, assemblies serve as a checklist for items that might not be shown on the schematic design but required for construction. For example, the schematic design elevation could show a brick veneer but does not include a wall section. If the estimator selects the brick veneer with metal studs assembly, he is also selecting material, labor, equipment, overhead and profit for brick veneer, brick sealing, metal studs, dens-glass, tyvek, coping, mortar net, flashing, concrete footing, concrete wall, rigid insulation, excavation and backfill. Other typical assemblies might include brick veneer with wood studs, EPDM roofing system, masonry bearing, metal studs parititions, etc.

Factors Affecting Take-Off and Pricing

Other information to consider while perfromng an estimate include location, project size, material cost, labor cost, equipment costs, general conditions, schedule and weather conditions, building codes, safety and security requirements, geotechnical and environmental considerations, sustainable design and contingencies.


Project location can have a direct impact on cost. Projects located within a major city where the

lay-down area isn't close to the project site; this could require additional movement of material and cost. Location also determines material cost and availability as well as labor prices. Transportation cost for materials in rural areas might increase. Travel cost or Per Diem might be required for skilled labor if the skilled labor is not availble in rural locations.


Project Size

The project size and type of construction affects the cost of construction. Different buiding functions require different construction materials and methods. With larger project of smiliar construction, the cost per square foot normally is less. This is "Economy of scale". Projects storing highly combustable materials will require enhanced high hazard fire suppression system versus light hazard for office space which increase cost.

Material Cost

Material cost fluctuates widely depending on supply and demand. If there is a high demand in construction market, material cost are normally higher; conversely, lower demand equals lower material cost. The types of material greatly influence the cost of construction. Metal composite panels cost more than wood siding. Limestone veneer cost more than brick veneer. Hardwood floor is more expensive than a carpeted floor. For almost any building material, there is a wide range of prices.

Labor Cost

Consideration must be given for projects that require Davis-Bacon prevailing labor rates or have union requirements. Labor rates sometimes are also affected by supply and demand. Higher labor demand equals higher labor rates; conversely, lower labor demand equals lower labor cost. Labor wage increases for multi-year duration projects

Equipment Costs

The cost of hauling materials, supplies, machinery, and equipment to a project can be a very expensive item in an estimate. Access to the job site may be difficult because of poor roads or no roads, heavy traffic to and from supply sources, or the requirement to obtain permits.


General Conditions

General conditions typically includes supervision, temporary facilities, drawing reprographics, winter conditions, insurance, phone service, dumpsters, small equipment rentals, building permits, taps fees, layout, mobilization, testing, field office, temporary security, etc. Each item listed will have a direct impact on project cost.

Schedule and Weather Conditions

The schedule or project duration will have a direct impact on project cost. Sometimes project require an enourmous amount of work in a very short duration. If so, overtime rates must be include in the estimate.

Projects constructed over winter months will require winter protection. Typical cost included temopoary heat, fuel, concrete blankets, concrete admixtures and winter charges, temporary construction or tenting, etc., and must be included in the estimate.

Building Code

Building codes require different types of construction and methods depending on building function and usage. For example, areas with the presence of combustile dust is a type two hazard by the National Electric Code. These areas are referred to in the Code as "Class II Locations" and required futher cost consideration for eletrical devices and motors.

Safety and Security Requirements

Safety and security requirement are costs that are easily forgotten. Cost for background check, drug screening, and identification badges could be a requirement for construction in sensitive work area.

Geotechnical and Enironmental Consideration

A Phase I (ESA) Environmental Site Assessment is usually the first step of due diligence. The assessment identifies potential or existing environmental contamination liabilties. Removal the hazardous materials will be a signicant cost and a potienal delay to the project.


Geotechnical investigations are performed to obtain information on the physical properties of soil and rock on the project site. Subsurface exploration usually involves soil sampling and laboratory tests of the soil samples retrieved. Test results are then reported in the geotechnical reports along with design recommendations for building foundations, building slab, and paved areas. The report will also give a recommendation for the sitework operations including possible soil addmendments and undercuts.

When renovating or demolishing older buildings, Asbestos Survey must be considered. Procedures for asbestos abatement and regulated material removal can vary depending on the type of structure and if the structure is being demolished or relocated and if the regulated materials are being disposed of or reused. All asbestos must be abated and regulated waste removed from the building and the entire property under the direction of environmental service personnel prior to demolition of the building. Asbestos abatement will increase the cost of the project.

Sustainable Design

LEED certification for building is becoming very popular. The LEED rating system offers four certification levels for new construction which are Certified, Silver, Gold and Platinum. Each level of certification requires various construction materials and methods. Some aspects of LEED design have little or no first cost including site orientation and window and overhang placement. Other aspects of LEED design have additional cost impact. For example EQ Credit 6.1: Controllability of Systems: Lighting requires a high level of lighting system control by individual occupants of by specific groups in multi-occupant spaces to promote the productivity, comfort and well-being of building occupants. Another example is the use geothermal to obtain LEED Energy and Atmosphere Credit 1, Optimize Energy Performance. Geothermal cost for a school could upwards of five hundred thousand. If LEED is being considered for the project, then the LEED checklist will serve as a guide for estimating LEED credits.



Contingency is to cover unknowns, unforeseen conditions and/or unanticipated changes to the construction that are not possible to eveluate from the schematic design and/or design narratives at the time the conceptual estimate is prepared. Conctingencies are uncertainties of the project scope at the time of the estimate and are not a projection of future scope or schedule changes. The goal to develop a contingency is to determine the confidence in the estimate value by a percentage that reflects the level of information shown or provide in the schematic design and/or design narratives. Typically, less information defined will result in a higher contignecy value. Scope definition and estimate quality have a significant bearing on confidence and risk. Likewise, the more information defined will result in a lower the contingency amount. Contingency allocations are specifically related to the project uncertainties and should not be reduced without appropriate supporting justification.


Assembly Estimating Example

Brick Veneer and Metal Stud Wall Assembly



Example: Exterior Enclosure

Cost Code Description



Unit Cost


Brick Veneer


sf / lf

$ 14.00

$ 224.00

Thru-Wall Flashing



$ 2.50

$ 2.50

Mortar Net



$ 2.50

$ 2.50

Brick Sealing


sf / lf

$ 0.50

$ 8.00

6"Metal Stud


sf / lf

$ 8.00

$ 128.00



sf / lf

$ 2.00

$ 32.00



sf / lf

$ 0.29

$ 4.64



sf / lf

$ 0.90

$ 13.50



sf / lf

$ 2.25

$ 31.50

Footer Excavation


cy / lf

$ 6.50

$ 2.34

Concrete Footer


cy / lf

$ 325.00

$ 22.75

Concrete Foundation Wall


cy / lf

$ 375.00

$ 34.50

Rigid Insulation


sf / lf

$ 2.25

$ 5.63



ton / lf

$ 750.00

$ 10.20

Cost per lineal foot

$ 522.06


Brick Veneer Wall and Metal Stub Wall Assembly

Typical Brick Veneer with Metal Stud Wall Construction


Glossary of Terms

Conceptual Estimating: An assessment of the cost or value of a project based on conceptual design information, including general characteristics such as size, shape, location, material selection, etc., and by necessity must include all items necessary to complete a project, whether or not explicitly shown or specified.

Feasibility Study: A detailed investigation and analysis of cost factors influencing the project to determine if the project is viable, such as type of structure, the location of the proposed project, the sources and availability of funding, and availability of utilities are examined and weighed against the financial return expected

Schematic Design: The first phase in the design of a project where an architect / engineer prepares schematic drawings giving a general view of building components and the scale of the project after detailed discussions with the client.

Project Narrative: A statement of design approach, defining purpose, functionality, program requirements, project description and building project elements, now more than ever, defining sustainability.

Building Function: Identifies useful purpose of the structure i.e. offices, schools, manufacturing, etc., for planning and code research.

Contingency: Contingency is to cover unknowns, unforeseen conditions and/or unanticipated changes to the construction that are not possible to eveluate from the schematic design and/or design narratives at the time the conceptual estimate is prepared

Phase I Assessment: An Environmental Site Assessment is a report prepared for a real estate holding which identifies potential or existing environmental contaminations.

Geotechnical Report: A report containing soil boring reports, soil classification, and desgin recommendations for structural foundations, building slab and paved areas.

Asbestos Survey: Asbestos survey is conducted to locate, identify, and assess the condition of asbestos containing material (ACM) present at a building, and to develop recommendations based on existing and potential asbestos related hazards.