Conceptual cost planning

Even at the early stages it is vital to understand the characteristics of the proposed development and to be able to benchmark the costs against other similar projects. Take a snapshot of the situation by weighing up all the possible factors and adjusting them for the new situation.

As such, this stage of the cost planning progress is about gaining knowledge to ensure the accuracy and validity of the information used to compare against is.

The preparation of the estimate enables the surveyor to make quick and accurate changes without using too much time or resources as the design changes.

Considerations to factor in

The surveyor will have to consider factors that will be fleshed out in greater detail as the design becomes more detailed. The list includes, but isn’t limited to:

• physical factors – these can be man-made such as a confined city centre site, known underground problems such as utilities, underground metro systems. Alternatively, they could be natural such as rivers, soil conditions, etc.;
• external bodies – legislation requirements, local planning decisions - this could include façade retention, maximum density or development contributions;
• client requirements – these will be better known and could be either very stringent with the need to meet a certain criteria, e.g. plant location within the industrial unit or something that could be compromised.

Compiling the estimate

When compiling the estimate at this stage it should look at the wider spectrum costs and should include the following:

• assumptions;
• exclusions;
• construction costs;
• professional fees;
• planning and Building Regulation fees;
• insurance;
• legal and agent fees;
• funding costs;
• inflation during the development period; and
• dependent on the needs of possibly a rudimentary life cycle costing.

As such there may be more than 1 party that contributes to the cost planning (such as a letting agent providing sales values). These contributions are to ensure the client will have all the available factors to consider the feasibility of the development.