01. Cost Control Flashcards
Name some factors that influence the cost of buildings
Plan Shape
Height
Envelope Area
Internal Partitions
Ratios
Buildability
Location
What is Cost Planning?
Cost planning is a key due diligence step in preparing for a construction project
Why would you use cost planning?
Cost planning advises a property owner how much a proposed project will cost and when the expected expenses will occur, this is critical info to obtain project financing and whether a project is viable
Describe a Cost Plan
Cost plans are generally prepared by Quantity surveyors and evolve during the life of a project, developing in detail & design.
What is Value Engineering/Value Management?
Reducing the cost of building or structure without changing it’s function
Why do delays on site cost additional money?
Prelims, overheads, staff costings & inflation on prices
What are the 3 ways to obtain a cost/m² rate for a new building?
- Comparable project - comparing to one already complete within your organisation.
- A Professional colleague/organisation - There may be a fee for this
- Published Information
What is triangulation?
The process of using 2 or more methods in a study to check the results. This can be used to price a project using three different methods to get a good average for costs.
What is a Preliminary Estimate
An estimate produced at the inception of a project to provide the client with an indicative cost to complete it.
What is GIFA
Gross Internal Floor Area
What are the issues using GIFA to get a cost per square meter?
GIFA - does not allow for variables of shape, height & quality of a building and these will have a major influence on the QS choice of rate.
What are Accuracy & Consistancy
- Accuracy implies a closeness of the estimate to the actual value.
- Consistency is the measure of how often the accuracy can be relied on.
What are the 2 standard prelim rates?
- Employer Design 12.5%
- Design & Build 20%
How do find the Wall to Floor Ratio?
The Total Wall Area / the Total Floor Area
How do you find the circumference of a circle?
2piR
How do you find the area of a circle?
piR²
What 7 tabs should be included in an Elemental Estimate?
- Ancillary Info - Project & Building details
- Elemental Summary - Sub-Totals of Sections
- Estimate - Details on pricing
- Key Dimensions - External Perimeter, CL, Ceiling heights, GIFA, Roof Area
- Opening & Room Schedule - Windows, Doors & Rooms
- Assumptions, Exclusions & RFI - Assumptions made to price & Further info required.
- Rates - Log of rates used
What are two common indices associated with the cost study of buildings
- Construction Cost Index
- Tender Price Index
What are common applications for indices?
- Estimating/Cost Planning
- Forecasting
- Price Variation Clauses or Fluctuation Clauses
What are indices used for?
Either for updating historic cost data or for predicting future trends in costs & prices
What stages of a project could VE occur?
- Project Brief Development
- During Design
- During Construction
What are the 3 elements of Value Management?
- Value Planning - Carried out early in life of project.
- Value Engineering - during the detailed design or construction stage.
- Value Analysis - Carried out when building is complete.
Why would you consider whole life costs in design proposals
In most buildings occupancy costs will be more than initial costs.
Who usually issues variations to the design?
Architect, Engineers, client QS
If there is a large omission from a contract what is a contractor entitled to claim for
Loss of Profit can be claimed
What is the 1st place to take rates from Variations?
BOQ
What is included in the whole life costs of a building?
- The initial capital costs, (Land, building)
- The operating costs (Utility bills,
- Maintenance costs for the buildings lifespan
What should a developer consider when deciding on costs of a building?
- How long until the development becomes profitable
- How to finance the project - i.e. investors, bank loan
- What rates will be applicable - Water charges, council rates
- Cost of the land - and value it will be worth after the building lifespan is over.
- Maintenance & security costs
Future Dismantling & Demolition may be required.
What should be considered if a project does not appear viable to develop?
- Could it be done at a different location
- Reducing size of building
- Value engineering to reduce the costs of the build
- Reduce building costs by making it a passive build, = higher initial costs but reduction in running costs.
What equipment costs should be thought about in building life span costs?
Cost of running equipment esb/gas etc. but also life span of equipment could be 5 years. In a building expected to last 20 year the equipment will have to be changed 4 times.
What is NPV?
Net present value, referring to the difference between the value of cash now and the future value of the same cash amount. It is used to determine if projected financial gains for a project will outweigh the present day investment.
What is meant by basket of items on (for example) Student Accommodation?
- The cost of land purchase at todays prices
- How much rent to charge
- Will there be rent increases
- How many students will need to occupy the building to turn a profit?
- Maintenance & Upkeep
Which is better for Cost data a) Tender Price Data or b) Final Account data?
Answer a) Tender Price Data because it is not subject to post contract influences such as variations etc. and is easier data to collect.
Why do builders & surveyors need ready access to cost information?
- Preliminary Estimates.
- Estimating/Cost Planning during design.
- Contract Estimating
- Costing Variations
- Settling contractors claims
