What is a Conceptual Estimate
- done when project is first conceived before the design begins
-establishes rough budget for fiscal planning - calculated using major project features
- refers to cost of similar facilities (with adjustments)
What is a Preliminary Estimate
- done when conceptual design completed
-need to estimate total budget for financial commitment - calculated based on historical rates (ex. for a building : total area x cost/m^2, bridge: total length x cost?m etc)
- +- 20% accuracy, done by owner
What is an approximate Estimate
- done when design is finalized, for more accurate financing required
- use as guideline for bid selecting and monitor during construction
- owner hires engineers or quantity surveyors to estimate cost
- use unit costs and required amount of work for estimation
- +- 5% accuracy, done by owner’s engineer/quantity surveyor
What is a detailed bid estimate?
- done when design finalized and preparing for a bid
- contractor provides estimate of project based off owner
calculated using unit cost in work items and required amount of work - reflects contractor’s desire to win project
- += 2.5-5% accuracy, done by GC
What costs are under Direct vs Indirect costs and how much percent do each take?
Direct cost (65-90%):
- Labour cost
- Material cost
- Equiptment cost
- Subtractor cost
Indirect cost (10-35%):
- Project overhead
- Markup
What are Labor Costs
Direct Labor costs: costs that are paid to field workers
Indirect Labor costs: costs that are additional to direct costs (payroll taxes, insurance, fringe benefits etc), usually = 25-50% of direct labour cost
What are Material costs
All costs in procuring materials (delivery, storage, inspection)
Contractor must:
- produce own materials (use own estimate) OR purchase materials from manufacturer
- include cost for storage, handling and installation of owner supplied or designated materials (excluding cost for purchasing materials)
What are Equipment Costs
All the costs of renting equipment
Diff Cost Rates:
- cost/hour (eg. tractors, scrapers)
- cost/unit installed ( eg. concrete mixing)
- cost/week or month (eg. scaffolds)
Accuracy of cost estimate depends on equipment importance
- Major equip = very detailed analysis
- Minor equip (power tools concrete vibrator) = standard cost allowance
- Minor equip (hand tools, water hose) = lump sum allowance as % of direct labour cost
What are Subcontract Costs
GC subcontractor portions of work to subcontractors
Cost of subcontractors finalized before final bid
GC must review and select SC (like owner selects GC)
What is Project Overhead cost
All costs that don’t pertain directly to construction workers (5-15% total project cost)
Refer to list in pg.17 of Lecture 8
What are Markup Costs
Subjective
- 5-20% total project cost
-corporate overhead, contingency and profit - reflects contractors appraisal b/w being lowest bidder and having a higher chance to make profit
Factors:
- desire for work
- competition
- market conditions
- relationship with owner
- magnitude of risks and opportunities
