When you decide to remodel or upgrade your commercial building, you may wonder how much time and money you’ll need to account for. While the ultimate cost will be determined by the nature of your project and property requirements, there are certain factors for you to consider. By understanding the spectrum of commercial renovation costs, you can adequately prepare for whatever may come.
Starting a new construction project starts with a number of preparations. Between negotiating contracts and hiring general contractors, one of the most important factors is preparing your budget. While it may be difficult to pinpoint exactly how much you might spend in a specific commercial project from start to finish, there are important considerations to consider when you’re in the planning stage.
Understanding Renovation Cost Factors
No two properties are the same. Creating a budget for a remodeling project may look different from property to property. Even if the layout and architecture are similar, the costs associated with a renovation project can vary based on factors such as location, usage, and building codes.
- Location – Depending on the area in which you live, the average cost of labor or building materials can fluctuate. In the United States, renovation projects can vary by as much as 70% based on location, especially when considering housing developments.
- Usage – How will your building be used? From certain amenities to required features, the needs of your tenants will greatly affect how much money you need to set aside for renovations.
- Building Codes – What regulations must you adhere to in your local community? In order for you to meet these code requirements, it’s important to know what licenses, surveys, or special materials will need to be purchased in advance.
Pro Tip: Restoring a historic building is a great way to boost your real estate value, but if you’re located in a historic district, there may be additional laws to consider. Check with your local authorities before you start construction.
Accounting for FF&E Expenses
In the process of researching what your commercial construction costs will look like, there are two different parts to consider in your budget. On one side, you have basic tenant improvements such as new walls, windows, carpet, paint, or structural elements. Those can vary based on product type and amount of materials needed.
The second part, however, is often overlooked in building or office renovations. This particular category is often described as FF&E, which stands for Furniture, Fixtures, & Equipment. While it can be difficult to estimate how much will need to be accounted for in this particular category, the expenses of computer systems, office furniture, or any other costs associated with operation can add up quickly. As you’re considering the different commercial renovation costs, be sure to include FF&E in your initial budget so that you’re adequately prepared.
Planning Ahead for Unforeseen Costs
Like any project, the actual building process may not look exactly how you planned on paper. It’s important for you to be aware of any unexpected costs that might come in the course of your project, especially if you’re on a tight budget. Pay attention to the following factors that may affect your costs significantly, such as:
- Incorrect building designs
- Air conditioning or electrical wiring issues
- Weather delays
- Untrained structural engineers
- Breakdown of equipment
- Changes to the scope of work
Partnering with a Construction Manager
Ultimately, every property has various factors that will affect the amount of time and cost required for completion. An experienced construction manager at Tarantino Properties understands the unique needs of every commercial or multifamily property. Whether you’re completing a minor repair or need major reconstruction, our team is committed to finding solutions to help keep your construction costs at a minimum.
Connect with our team to learn more about our management services to assist you in your next property renovation.