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Drawings & documents · Fees

Construction cost and pro forma

Estimate construction cost from SF tiers and line items, keep your own cost library, and price design-build or a development.

Construction cost #

The Construction cost tab estimates what the building costs to build. The percent-of-cost fee, design-build and the pro forma all use it.

The four numbers at the top are the Low, Mid and High estimates, each with its cost per SF, and the Actual budget from the left column.

Estimate from #

The Estimate from card picks what the estimate adds up:

  • SF tiers
  • Line items
  • SF tiers + line items

Apply the region factor to the $/SF tiers multiplies the tier costs by the project's region factor. The card's corner shows the factor in use.

Region factor #

The factor comes from the Region in the left column, or from Your own factor if you type one. It's a rough relative index of building costs by location, from a public government source; open Where the region factors come from in the left column for the source and its limits. If you know the local market better, type your own.

Cost per SF tiers #

One row each for Conditioned, Unconditioned and Exterior built spaces. The areas come from the left column. Type a low, mid and high cost per SF for each; the row shows the low, mid and high totals.

The starting tier costs are placeholders, not market data. Set them from your own work.

Line items #

Click + Line item for each item you want to price on its own. Each line has a Location, Label, Description, Unit (SF, LF, CY, lb, Unit or Lump sum), Qty, and a low and high cost per unit. The row shows its low and high totals and its share of the total.

Line items you type are used as typed. Items you add from the library are moved to this project's region.

Cost library #

The Cost library card lists unit costs you can drop into the estimate. Search it by name ("foundation", "framing", "concrete"), set a Qty, and click Add to add the item as a line item, adjusted to this project's region.

The seeded items are rough public references (national averages and public bid prices), each with its source, date and license. They aren't estimates for your project. Your own past projects are better data.

My costs #

My costs is your own cost history, saved with this estimate.

To record a finished project:

  1. Type the Finished project name, its Total construction cost, its SF, its Region and the Year.
  2. Click Record $/SF.

It's saved as a cost per SF and shows up in the library search, moved to each new project's region.

To add any other unit cost of your own, click + Unit cost of my own and fill in the row.

Design-build #

With Design-build picked under What you're pricing, the Design-build tab prices the whole contract:

  • Construction cost basis: Low, Mid, High or Actual.
  • General conditions, Contingency, Overhead, Profit and Bonds & insurance: percents. Each one is added on top of the running subtotal, in that order.

The top shows the Contract price, the Construction price, the Design fee (your proposal total) and Your gross margin (fee, overhead and profit). Where the contract goes breaks the contract price into its parts.

Pro forma #

With Self-development picked, the Pro forma tab runs the project month by month, from the construction start in the left column. The top shows Profit, IRR (equity), Total cost and Equity / loan.

Costs:

  • Land and Closing & acquisition (a percent of land).
  • Hard cost from the estimate (Low, Mid, High or Actual), or type it in …or type it.
  • Other soft costs: a percent of hard cost, for permits, consultants and legal.
  • Design fee in soft costs: tick Include to add your proposal total.
  • Carry: the monthly cost of holding the project, like taxes, insurance and utilities.

Schedule, loan and exit:

  • Construction and Lease-up / sale, in months.
  • Draws: S-curve or Straight, how spending spreads over construction.
  • Loan-to-cost and Loan fee. Your equity goes in first, then the loan.
  • Exit: Sale price, or NOI ÷ cap rate with Stabilized NOI and Cap rate.
  • Selling costs: a percent of the value at exit.

Interest is added to the loan balance each month, and the loan is paid off at the exit.

Interest rate path #

The loan's rate follows an index you expect to move, plus a spread:

  • Index: its name, like fed funds.
  • Spread: points over the index.
  • The table: a Date and an Index % per point; Loan % is the index plus the spread. Between points the rate moves in a straight line.
  • + Point adds a point. Fed projections fills the path with the Federal Reserve's published rate and projections as of a fixed date.

Those defaults go out of date. The card links to the current published rates: check them and type them in.

The chart beside it shows the loan rate over the months. Draws and the loan balance charts the spending and the loan balance; open Month by month for the table.

The pro forma is a planning estimate. Check it with your lender and accountant before you rely on it.