|
Most people only see one bucket - construction cost - the number the architect designs to and the contractor builds to. But that’s just part of the story.
There’s a second bucket most budgets miss: project development costs.
These include professional fees, testing, furniture, technology, utilities, and relocation expenses - all essential to actually deliver the project. We typically estimate these at about 22% of the construction cost.
Then there’s the third bucket: contingency. Every project needs it, and it comes in three forms -
- Owner’s contingency for scope changes,
- Contractor’s contingency for unforeseen conditions, and
- Design contingency, which shrinks as drawings progress.
Add all three together — construction, development, and contingency — and that’s your Total Project Cost. Ignoring those extra buckets doesn’t make them disappear. It just guarantees surprises later.
| 
