Next up in the short course: the cost of architecture and its role as a creative boundary for the
work. By necessity, this discussion will be an oversimplification – a conceptual approach
- because architecture is unique, complicated and specific. Now, I’ll show you how I use
a basic framework to inform the design process for our case-study project.
Up until this point I’ve only mentioned developing a project budget once, this was
right before we began the schematic design phase. I mentioned how we directly linked
the budget for our project - in our case a residence - to the overall square footage
of the home. Now, I want to spend some time on this because although it’s not discussed
in our training as architects in school, it’s part of the reality of making architecture
in the real world and it’s one of the most basic and obvious concerns for both architects
and clients. Now, when we talk about the cost of architecture
we typically break it out into one of two categories: there are soft costs and hard
costs. Soft costs are the indirect costs of construction: things like design fees, consultant
fees for services like structural or civil engineers, lighting designers, energy auditors
and landscape architects. There’s also permitting fees, insurance, financing costs, special
certifications like LEED and often times legal fees.
Now, hard costs are essentially everything else related to the real cost of construction,
the bricks and mortar that make up the physical building. The full cost of a project includes
both hard and soft costs as well as any land acquisition costs. Soft costs can be defined
by soliciting proposals from the agents involved. Architects will have a standard fee schedule:
either a fixed fee calculated as a percentage of the cost of construction, an hourly fee
model or some hybrid, some mix between both – hourly in the beginning perhaps and then
fixed once the scope is determined. Typical full-service design fees will range between
five and twenty percent of the construction cost. As a general guideline, smaller projects
will fall on the higher end of the percentage range and larger projects on the lower end.
Hard costs will account for the majority of a building’s cost and the ones the design
– the architecture - will have a considerable impact on. Now, before I even begin a design,
I evaluate the client’s hard cost budget to determine whether it’s reasonable given
their desired scope of work. Now, naturally in the beginning of a project we know very
little about the building so it’s not possible to do a detailed material take-off of the
building components; we don’t even know what they are yet. Instead, we start by developing
a detailed accounting of the spaces. This is sort of a wish list, what architects call
the program. From this list we begin assigning room sizes for each space.
Knowing the overall size of the building will help us make sure the size needs correlates
with the client’s target budget. But we have to get a little more granular than that
if we want a useful budget figure to work with. To do that, we assign a multiple or
factor to each space in the program. As you’d expect a living room with tall ceilings will
cost more than one without tall ceilings; there’s more finishes, more labor, potentially
more engineering and structural costs. And likewise, a deck or a covered porch area won’t
be as costly to construct as finished interior space with few or no walls, no insulation
no heat. By factoring the square footage of program spaces that are different than typical,
conditioned interior space with an eight-foot tall flat ceiling, we can more accurately
develop an estimated budget for us to use as a decision-making tool.
As an example, let’s take a living room that’s twenty feet by twenty feet or four-hundred
square feet. Our baseline space is a flat, eight-foot tall ceiling. Spaces like these
receive a factor of exactly one. So, the factored square footage and the actual square footage
are equal. Now, this is the case for most of the spaces in our case-study residential
project. Let’s say one of our proposals included a vaulted ceiling in the living room.
For this square footage, we’ll apply a factor of one point five which effectively increases
the factored square footage total for this space. For the living room example, rather
than four-hundred square feet, the vaulted ceiling would total six hundred square feet
in our programming worksheet. We get that by taking four hundred and multiplying it
by a factor of one point five. The spaces that I factor in the programming
worksheet are as follows: first, garages, decks and terraces are all factored at point
five, screened porches or covered porches are factored at point-seven-five, and then
there’s any spaces with ceilings higher than the standard eight-feet are all factored
at one point-five. Now, you’re probably wondering, why don’t
we factor every space differently. After all hallway space and kitchen space they, they
aren’t truly equal in terms of cost to construct but under this model they’re treated as
such. And while it’s true kitchen space might be five-hundred dollars per square foot
and the hallway space perhaps one hundred dollars per square foot there’s a whole
lot less kitchen space than there is hallway space. It doesn’t make sense to do this
kind of detailed tweaking because it presumes a level of precision that this kind of early
estimate inherently lacks. In general, with this method these inconsistencies will average
out assuming you take care to apply the factors I mentioned.
Now, why does all this matter? Well, this is the key, remember the budget estimate early
on is linked directly to square footage. Once I total all the square footage for the project
I multiply that total by a cost to construct per square foot. Now, this number is always
a range and this is for two reasons: first because before you even have a design; a range
is a realistic means of portraying the variability of the potential costs involved. Second, because
no two contractors will look at the design, the drawings and the specifications the same
way, even when given the exact same information. Equally, building techniques vary from contractor
to contractor as do subcontracts and labor rates. Now, imagine for a moment that the
client hires the most meticulous local contractor to build their home. If you assumed and designed
the size of the home around the three hundred dollars per square foot benchmark, sizing
it to meet their budget during schematic design phase - if the chosen contractor is used to
constructing things at six hundred dollars per square foot the building is now one hundred
percent over the client’s budget. It’s important to have these discussions early
on to correlate quality expectations. Now, if we assume that the average local custom
building cost here is between three and four-hundred dollars per square foot and then apply it
to the factored building square footage we’ll have an estimated budget range to work with.
Now hopefully you can fully appreciate the value of our factoring exercise. With this
model, the cost to construct the living space with an eight-foot ceiling would be one hundred
and twenty thousand dollars at three hundred dollars per square foot and to construct the
vaulted space the cost would increase by sixty-thousand dollars. Now, will the space actually cost
sixty-thousand dollars more to construct? Perhaps not, but it’s definitely going to
cost more and it’s not unreasonable to assume quite a bit more. Really this is meant to
provide a starting point to work from and can be fine-tuned based on your own project
experience. As you build more or collaborate with other builders who might have a deeper
backlog of cost estimates, you can dial-in these spreadsheet factors.
No matter how accurate you think an estimated cost projection is, there will always be some
things you leave out. Some things you missed. Materials or systems not accounted for, price
increases, labor shortages, unforeseen subsurface conditions. I recently had a project where
the shingle costs were increased by twenty percent due to a new tariff placed on imported
wood products from Canada. Literally overnight, material acquisition costs for the shell package
increased by twenty percent. To cover these unforeseeable circumstances, always add a
contingency to your estimates. A contingency is like a slush fund, a percentage of the
overall budget reserved unknowns. It starts out in the early phases of design as a rather
high fifteen percent; there’s more at this point that we don’t know than we do know.
Then we reduce it as we define more and more aspects of the structure from ten percent
down to five percent. The more we know about the building, the more accurate our estimates
can be and the less need we have for contingency. As the building progresses in construction
we can begin to release some of the contingency fund back to the owner’s control – hopefully
unspent. All this information helps both the architect
and the client to guide scope decisions. Before the design concept is established and before
you start drawing lines, use the total budget to determine the overall building size the
client’s budget will support. Doing this ensures the client isn’t surprised by the
reality of construction costs – that sticker shock – and equally that the architect isn’t
spending their fee designing something that the client ultimately can’t afford. In the
early stages of design, it’s nothing more than a best guess and it’s good practice
to involve a contractor as a partner sooner rather than later to help evaluate costs.
For larger projects this process will likely involve a cost estimating consultant and it’s
much more involved. But,the concept is very similar.
So how does all this relate to design? Well, cost is an important creative boundary. Without
cost limitations, anything is possible. When you begin to constrain the projects in various
ways, new design opportunities will present themselves. Look for economies of scale, use
humble, inexpensive materials, simplify design moves, do more with less, design spaces that
can serve multiple functions, question just how much space you actually need to accomplish
a certain task. When you realize that every square foot costs between three and four-hundred
dollars it holds you accountable for each one in a much less abstract way. It’s why
I regard building your own dwelling, at least for an architect, as an essential part of
professional education. It forces you to experience the real cost and financial stakes involved
in building. Perhaps most importantly, every added square
foot is another one you’ll have to heat, cool, light, maintain, and clean for many
years to come. Buildings use an incredible amount of energy and here in the USA our homes
are substantially larger than our European counterparts. Be ruthless about what you
really need and what you can live without. Be responsible, by consuming fewer resources
your self-less act gives to generations that follow us.
Once we bring in a builder and begin defining more of the building details, the square footage
estimate can be jettisoned and replaced by the builder’s estimate which will be refined
at the major waypoints to ensure we’re proceeding according to the budget. During the early
design phases to be serious about controlling costs will most often require reducing square
footage. This will be the easiest and best opportunity you have to do so. When the foundation
has been poured and hammers are flying the amount of impact you can have on building
cost is severely limited. Don’t think you can save money by simply changing materials
at this stage, the bulk of your costs are tied up in square footage. This is the power
law of the economics related to architectural design.
As we translate our sketch plans into working floor plans, invariably the size changes.
Returning to our project, our client chose two of the schematic plan schemes to hybridize
and I developed a few plan options for each. To make things more realistic, I translated
the sketches into CAD line work which always has a sobering effect. Sketches are forgiving,
they’re easy to fake. But laying things out in CAD is different, you’re working
with real sizes and alignments and wall thicknesses. Having roughed it out I massaged a few functional,
if not rather primitive, floor plan options for the client to review. Now, as part of
this process, things got larger. I spread it out on the site a little bit, bedrooms
increased in size, hallways lengthened. And, when I revisited the square footage take-off,
the footprint – and consequently the building cost - had increased significantly. So, again
I retooled, and revised, made things smaller, pushing and pulling to align the two. In the
end, there was an overall expansion of the programmed square footage. But, I’m happy
to say that this was a client driven decision, spaces were increased to accommodate certain
wishes and desires and this too is the benefit of the programming and budget exercise. It
allows the client to be in control of where and how they spend their project dollars.
It’s fine with me if they want to spend more or less, I’m here to provide the information
which allows them to make the most informed decision possible.
Having a baseline tied to a budget keeps the two in check. It’s always a good idea to
revisit the square footage and cost estimates at different points in the design process
in the same back-and-forth manner as we do with the other aspects of our design.
Next up in the short course: materials. How I chose them, how they support the design
concept and an inside look at one of my favorite waypoints in the design process. Until then,
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