Controlling Costs: How to Create a Commercial Renovation Budget
Are you taking on a commercial renovation?
It can be challenging if you don’t have a plan or a budget. There’s a chance that you are using someone else’s money to fund the renovation. That could be your bank or a team of investors.
They’re going to hold you accountable for the costs. How can you control the costs for your commercial renovation?
Keep reading to find out.
1. Know the Cost Factors
Commercial renovations are a lot different than residential renovations. There are many more factors that go into creating your budget and can impact the cost of the renovation.
Your location has an impact on the budget. You can have the same project cost twice as much from one location to the next.
You can guess that major cities like New York and San Francisco will cost more than smaller cities like Orlando.
Other cost factors include the type of renovation, the building, and whether or not you have to comply with historic and other building codes.
For example, a restaurant renovation in a historic district will cost much more than a warehouse renovation in a suburban area.
2. Plan and Design
Everything in your budget will come from your plan. You can use design software to create your plan and map out what you want to do to the space.
You can also bring in a designer to help you come up with concepts if you’re not sure what you want. There are concepts like commercial restroom design that you may not be aware of and can use assistance.
That will give you an idea of the scope of the project and who you need to hire on your team. You may find that you need an architect, general contractor, plumbers, electricians, and more.
All of those team members will have an impact on your budget.
3. Get Estimates from Experts
Depending on the scope of your project, you may need to have many team members give you estimates of the costs for their part of the project. You need to account for labor, materials, and insurance in these estimates and in your budget.
4. Plan for Delays and Surprises
The one thing that will hurt your budget the most will be unexpected surprises. A contractor may knock down a wall and find asbestos.
That will delay your project and you have to hire an abatement company to remove the asbestos. That will increase the costs significantly in your budget.
A contingency budget is a line item that will help you absorb these surprises. You should count on about 10% – 15% of your budget should be devoted to contingencies.
Completing Your Commercial Renovation
Whether you’re transforming your current office space or renovating a restaurant for opening day, a commercial renovation can be expensive.
It’s your job to create a budget and stick with it. You want to make sure that you know the cost factors that can impact your budget.
The plan for your renovation is going to determine what your budget is. The more decisions and detail you can give to designers and contractors, the more accurate the estimates.
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