Construction Docs - Chpt. 5 Cost Estimates

Just finished reading chapter 5 in my study for construction documents. 11:15am - 1:45pm 2.5hrs
Cost estimates
Architect often provide cost estimates of construction costs as part of their services. They are done at each phase of the project and there are different types depending on the phase. Estimate provided is not a quarantee or warranty that actual final estimates will NOT be higher. "reasonable care" in preparation and obvious negligence can prove liability for owner damages.
Owner must be advised about the unpredictability of construction costs and fluxuating markets.

Different cost considerations
1. Initial cost of materials and equipment
2. installation cost (labor)
3. long term cost (maintenance / longevity), operational costs, more you spend initially = less long term cost, efficiency = savings, weight client requirements, give opportunity to invest in quality. Design for energy use of building, elec/gas/solar/h2o, etc and cost variances/stability.
Maintenance costs, specify lower maintenance products, also design configurations for easier access, cleaning, etc.
4. Labor costs: often more than 50% of total construction cost., design to minimize labor, field labor costs more than shop labor, union vs non union (union required in many projects)

Architect responsibilities (per AIA docs)
Prelim and updated cost estimates provide general estimates, contract states that neither architect or owner can control the real(final) cost of labor, materials or equipment.
1. Study owner's program and budget.
2. Compare feasable relation of the two.
3. Inform client if any changes required, reduce program or increase budget or both (balance)
4. Develop Schematic design
5. Execute preliminary estimate of construction cost (Area/Volume x cost per sq. ft. is most typically used, others are Subsystem estimates & detailed), does not include architect fees.)
6. Advise, Advise, Advise! Always keep client informed of major discoveries of required changes and cost discrepancies, unpredictability of construction costs.

Bids over Budget
4 options
1. increase budget
2. rebid or renegotiate within a reasonable time.
3. Abandon project
4. Reduce scope, quality, or both & rebid. (no additional charge to modify drawings by architect)

Consultants have same cost estimating responsibilities as Architect.
give consultant scope a set percentage of budget.

Factors Affecting Cost
1. Legal and admin requirements in general conditions.
a. liquidated damages & no damages for delay may increase contractors bid amount due to more risk involved for their party.
b. Required insurance
c. field offices
d. submittals, samples, shop drawings & mock-ups
2. Project complexity, building size, shape and extent.
3. Complexity or lack of clarity of construciton documents
4. Materials and Methods
a. required quality and workmanship
b. certian building types require higher quality materials.
c. typical details and repetative layouts can reduce cost
5. Project Location
a. Labor and material availability, local union strengths
6. Construction Schedule
a. Shorter schedule will increase cost, more contractor risk is involved
i. requires increased crews, equipment and overtime.
b. Extended schedule causes additional overhead
7. Bidding environment
a. contractors bids sometimes depend on
i. number of projects available fo bidding
ii. amount of competition
b. Architect must assess these factors.

Other Elements of Project Cost
Direct cost of construction is covered by architect's cost estimates.
There are other costs involved that are included in the budget together with the direct cost.
It's important to note the difference. Direct cost does not equal the project budget, it is only about 50% of the costs. Additional costs are:
1. Owners staff costs, legal fees and outside consultant fees.
2. Land acquisition, including rezoning if required.
3. Demolition of existing structures or other improvements.
4. Site Work
5. Landscaping
6. FF&E = Furniture, furnishings and equipment
7. Special equipment
8. Professional fees for architects, engineers & special consultants.
9. Insurance
10. Financing
11. Taxes during construction
12. Contingencies for unforseen conditions

Items 3-7 are sometimes included in the direct cost for construction.

2:45-3:30 to write this summary