Understanding Cost Estimating
Let Our Los Angeles Construction Experts at MPGroup Guide You Through the Process
Some time ago, there was an estimator who would create construction cost
estimates and would later describe how he arrived at his figures by saying
he conducted a "
a scientific wild-ass guess!
In the real-world, cost estimating is done by a careful, orderly and scrutinizing
process that is known as a quantitative survey. A quantitative survey
simply stated is analogous to counting beans in a jar. In order to properly
count all the components (
materials and labor) that go into constructing the building itself and achieve an accurate
cost-to-construct one must master an essential component of estimating
construction cost and that is
experience and lots of it!
To achieve the cost-to-construct the estimator will diligently study the
project's plans and specifications and list each and every component
by making a material "take-off" and then quantify the labor
cost factors that will be required to construct the project.
Some estimators use costly computer programs such as Primavera Systems™
which is the brand name under which a range of software packages that
collectively form a comprehensive enterprise project portfolio management
(EPPM) solution are marketed. Primavera was launched in 1983 by Primavera
Systems Inc. and was acquired by Oracle Corporation in 2008. Numerous
other computer cost estimating programs are on the market and are widely
used today. Some estimators use construction cost estimating books and
software such as
Marshall & Swift,
National Estimator, R.S. Means and
Saylor Publications. Others may do it the "old-fashioned way" by methodically making
their "take-offs" and using a spreadsheet such as Microsoft
TYPES OF ESTIMATES
Conceptual: An estimate at this stage begins with an idea generated by an owner or
architect with only very limited basic information available. Often the
information may consist of a felt tip pen sketch drawn on a paper napkin.
The estimator must visualize the building components and develop an estimate
which should include a percentage of the total as a contingency factor.
Rough Order of Magnitude: For example, if a city wants to build say a sewage treatment plant and
the only relevant data available is the treatment plant's daily capacity
in millions of gallons. An estimate of cost can be derived from similar
projects in the past by adjusting for location and inflation; plus a contingency factor.
Working Drawings Stage:As drawings and specifications begin to appear estimates are prepared and
updated at the 30% & 50% stages with a reduced contingency factor
as drawings and specifications approach 100%.
Definitive or Bid Estimate: With completed and approved drawings the estimate is finalized with no
contingency added or added depending upon circumstances such as whether
the bid is highly competitive or not. The estimate then becomes the owner's
estimate of funding needs or if created for a contractor it becomes the
basis of their bid.
OTHER TYPES OF ESTIMATES
Value Engineering: This may
involve a team of professionals who meet and devise ideas or programs on
how a project can be built for less, produce a better product or produce
better methods to achieve notable cost savings without sacrificing quality.
Historic Preservation: The restoration and preservation of historic buildings is covered by a
number of state and federal regulations and require an estimator with
extensive experience in this very specialized estimating specialty. Unit
costs are generally double and sometimes quadruple normal construction costs.
Forensic Cost Estimating: The word forensic simply means "
For the Court." When a legal dispute involves mitigating defective construction
or the loss of use of any building structure by fire, man caused damage
or a natural disaster, the cost-to-repair or cost-to-construct must be
determined in such a manner that the estimate is presented to the triers
of fact in a simple and easy to understand format that must withstand
intense scrutiny by opposing counsel.
To find out more about cost estimating, set up a consultation with our
Los Angeles construction experts at MPGroup by calling (800) 684-9100.
Our Chief Construction Cost Estimating Expert is:
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