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26 Cards in this Set
- Front
- Back
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Base cost
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a cost from a cost manual that represents the average cost of a particular building before adjusting
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Benchmark building
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the average building represented by a base cost
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Comparative-unit method
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the least accurate method to estimate cost based upon size times square foot, cubic foot, linear foot, etc.
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Cost index
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a table or index showing cost changes over time; typically a base year represents either 100 or 1 and changes over time are from that base year
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Cost-index trending
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bringing an old cost current by multiplying old cost x current cost index divided by historical index
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Developer's fee
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return for time, energy, experience, risk the developer takes; equivalent to salary to developer
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Direct costs
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also called hard costs, generally labor, materials, & contractor's profit
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Entrepreneurial incentive & profit
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projected return to attract capital of developer (incentive), amount expected in profit to build (profit)
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Gross building area (GBA)
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total floor area, measured from exterior, excluding unenclosed areas
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Gross leasable area (GLA)
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used for retail; total area for occupancy & use, incudes basements & mezzanines, measured from outside of exterior walls & middle of adjoining walls
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Indirect costs
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also called soft costs, includes financing fees, lease up costs, professional fees, permits, etc.
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Net rentable area (NRA)
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the area that may be leased in a building. It is measured differently for different property types
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Project profit
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sale price minus cost
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Quantity survey method
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the most detailed cost estimating method; all components of a building are estimated separately. It is the most accurate, but most time consuming & expensive method.
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Replacement cost
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cost to build same functional utility at current workmanship materials
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Reproduction cost
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cost to build a duplicate
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Segregated cost method
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also unit-in-place method to determine improvement cost
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Unit-in-place method
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a method to estimate cost where building components are estimated, such as foundation, framing, roof, interior, HVAC, etc., then added together; more accurate than comparative unit, less accurate than quantity survey
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Cost-estimating methods
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1. Comparative-unit method
2. Unit-in-place method 3. Quantity survey method |
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Direct costs
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building permits
materials, products, & equipment labor used in construction equipment used in construction security during construction contractor's shack & temporary fencing material storage facilities power line installation & utility costs contractor's profit & overhead, including job supervision; worker's compensation; and fire liability, and unemployment insurance performance bonds |
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Indirect costs
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architectural & engineering fees for plans, surveys, and environmental studies
appraisal, consulting, accounting, and legal fees cost of carrying (in land) and contract payments during construction all-risk insurance and ad valorem taxes cost of carrying after construction, but before stabilized occ. is achieved supplemental capital investment in tenant improvements or leasing commissions marketing, sales commissions, or title transfers administrative expenses of the developer |
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Entrepreneurial incentive
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the amount an entrepreneur expects to receive (this is an expectation)
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Entrepreneurial profit
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market value minus cost exclusive of profit (this is a subtraction)
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Developer's fee
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is distinct from entrepreneurial incentive, is the compensation for overall management, as if on salary. It may be an indirect cost
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Project profit
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difference between total cost & market value
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Cost-index trending
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New cost = New index / old index x old cost
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