Construction cost estimates are as detailed as the information that goes into creating them. That means the list of inclusions will vary depending on where things stand with the project’s current phase of design and development.
Preliminary estimates are among the least accurate and should be used to assess a project’s feasibility only. As details of the project plan become more finalized, the construction cost estimate should also become increasingly detailed and accurate. For a look at the different types of construction cost estimates, be sure to read this post.
What to Look for When Reviewing a Construction Cost Estimate
The more detail, the better when it comes to reviewing an estimate. Close inspection of the budget allows you to verify assumptions and project scope, understand the itemized cost of materials and labor, assess permitting fees, taxes, and more. Here’s what else to look for when reviewing a commercial construction estimate.
- Material and labor costs – This includes preliminary site work as well as interior and exterior finishes. The costs for subcontractors and vendors may be included in these cost estimates or listed as separate line items.
- Mechanical, electrical, and plumbing (MEP) costs – Any hard costs and associated fees for MEP labor and expenses should be detailed in the budget.
- Management fees – This includes project management costs as well as design, permitting, site prep, clean up, and other management and overhead expenses.
- Project scope – In addition to assessing costs, you also want to ensure the basis for the estimate is in line with assumptions. You don’t want any errors in quantities or unit rates, and you want to ensure the full scope of the project is accounted for in the estimate.
As you compare estimates from multiple contractors, you will likely have questions. Any markups should be reasonable, and costs should be in line with current market conditions. Our team at Seacoast Construction is happy to answer questions about construction cost estimates, even if they’re not our estimates. Give us a call anytime at 786-433-8740 to learn more about South Florida commercial construction.
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