July 01 2016

Controlling Site Construction Costs

Site Construction Costs can account for 20 to 30 percent of Fire Station construction costs (hard costs). Various factors can influence site construction costs including; soils, site topography, environmental issues, traffic engineering requirements, storm drainage, zoning requirements, existing site conditions (structures and utilities), special requirements of Authorities having Jurisdiction (AHJ), site size and location, as well as the station design itself.

newspaperDue diligence testing of existing soil and environmental factors can go a long way towards minimizing site costs, and provide the information for the project team to make informed decisions as they move forward throughout the station design process. Whenever possible, this testing should be completed prior to purchasing the property. The existing site conditions discovered through this process can be used to negotiate the final site purchase price.

Maintaining open communications through the site development process allows all involved to have investment in the project and in the process. Engage approving authorities as “part of the solution” verses part of the problem is a must for a successful project.

Don’t forget to utilize your available resources throughout the site selection and design process. These include your design professionals (architect, civil engineer, geotechnical engineer, etc.). The design team can assist in evaluating site options, specifying the required testing; identifying fees and costs upfront, and maintaining open communications with the AHJ’s.

Correctly budgeting for site costs can make or break your project. By your design team taking a detailed cost estimating approach, many of the square foot estimating pitfalls can be eliminated. The more detailed estimate, the earlier in the process, equals better outcomes. It is important to include project size, location, and time/inflation factors into your overall budget. Overhead, profit, and general requirements (Division 01) typically account for 20% to 25% of the construction estimate. Understand and make the proper appropriations for project budget, estimate, and construction contingencies. The overall project budget should contain contingencies for both hard and soft costs as the budget detail is developed. Remember if at all possible to engage your architect in the budgeting process. The estimate contingency relates to the construction cost estimate, and varies from 10% to 20% depending on the estimate level of detail. In general, a ten percent construction contingency is recommended. This will provide a conservative safeguard against the unknowns underground at the beginning of construction.

Finally, the use of allowances can serve as placeholders in the construction documents for items with an unknown finite amount. An example would be for x number of cubic yards of engineered fill. The allowance represents the best guess estimate based on the engineering and geotechnical information, but the exact amount cannot be determined until the excavations are completed. Alternates can be used to keep options open, depending bid results. Examples of site alternates include pavement material upgrades, increased parking areas, site training features, security enclosures and monitoring, and landscaping.

Given the impact site construction costs have on the overall typical fire station cost, it is important to understand the influences up front that the site can have on your project, how those influences might be minimized, and how to implement a proper method of budgeting to account for and manage the costs that remain.