2 types of estimates
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This document discusses the different types of estimates used at various stages of a construction project. It describes conceptual, schematic, design development, and procurement phase estimates. For each estimate type, it outlines what information is available, how long it takes to prepare, its intended use, and typical accuracy range. The key points covered are: conceptual estimates rely on limited information and have an accuracy of +/- 20%; schematic estimates are based on 30% complete designs and have an accuracy of +/- 15%; design development estimates use 60% complete plans and have 5-10% accuracy; and procurement estimates use full documents for contractor bidding.
2 types of estimates
- 1. Building Economy ARE 431 Dr. Mohammad A. Hassanain Types of Estimates ٢ Types of Estimates. Conceptual Phase Estimate. Schematic Phase Estimate. Design Development Estimate. Procurement Estimate. Today’s Lecture
- 2. Building Economy ARE 431 Dr. Mohammad A. Hassanain ٣ Types of Estimates When beginning to prepare an estimate, it is important to understand its intended use. An estimate can be prepared at any point throughout the life of a project. Depending on the information available and the time spent preparing the estimate, the accuracy it provides will vary. There are four different stages at which estimates take place: Conceptual phase. Schematic phase. Design development phase. Procurement phase. ٤ Conceptual Phase Estimate This type of estimate is called a Conceptual or Rough Order of Magnitude (ROM) and is generally prepared long before the construction starts. The owner needs cost information very early on in a project so that decisions as to the location and scope can be made before money is spent on design or property purchase. This estimates will be prepared with very little information, relying mostly on historical data. The description of a project may be a sketch or a brief written description.
- 3. Building Economy ARE 431 Dr. Mohammad A. Hassanain ٥ Conceptual Phase Estimate The size of the project is generally known, although it may be described in terms of capacity such as: The number of beds for a hospital. The number of students for a school. The number of rooms for a hotel. The time needed to prepare this type of estimate is short, generally in the range of a half day or less The accuracy of this type of estimate ranges between + and – 20%. ٦ Conceptual Phase Estimate The presentation of the conceptual phase estimate is generally informal for the purpose of providing a target budget. Estimates are often prepared for many different options so that owners can select the best alternatives(s).
- 4. Building Economy ARE 431 Dr. Mohammad A. Hassanain ٧ Schematic Phase Estimate As the project moves into the schematic stage, the designer and possibly the construction manager have become involved in the design and estimating of the project. The program (list of project requirements) for the project has been provided by the owner. The project team may be incorporating different design alternatives into the basic design. A schematic estimate will be based on a design that is approximately 30% designed and include the following information: Floor plans, elevations, and sections. Outline specifications for most trade sections. Drawings for mechanical and electrical systems. ٨ Schematic Phase Estimate This estimate include some area take-off, and calculation of the major project elements such as: The gross area of the building. The exterior wall area. The gross cubic meters of earth to be excavated. At this stage, some of the key sub-contractors might be asked for input for complicated systems. This estimate will take one to two weeks and will carry a 10% contingency for unknown design and engineering details that will be developed during the next design stage and an accuracy ranging between + and – 15%. At the end of the schematic design stage the presentation of the design to the owner is accompanied by an estimate of the cost of the project.
- 5. Building Economy ARE 431 Dr. Mohammad A. Hassanain ٩ Schematic Phase Estimate Any design alternatives will also be accompanied by an estimate of the cost of the project. Before the project team moves on to the next phase of the design, the owner will decide on the basic design parameters and on the project budget. Any cost reduction ideas will be presented and priced by the estimators. Some of these ideas may be accepted or rejected at this stage, and some may be carried forward to be better defined in the next phase. ١٠ Design Development Phase Estimate The design development estimate is based on much more defined information. Because of this, the time taken to prepare this type of estimates is longer, but the accuracy is greater. The estimate in this stage will be based on a design that is 60% complete and includes the following information: Floor plans at a larger scale. Elevations, sections, and details at a larger scale. All relevant specification sections. Well-defined mechanical and electrical systems. Most of the major project items will be quantifiable, and the more important unit prices should be known at this point.
- 6. Building Economy ARE 431 Dr. Mohammad A. Hassanain ١١ Design Development Phase Estimate The preparation of this estimate should take two to three weeks and the accuracy is within 5 to 10% of the final cost. With the presentation of this estimate, the costs of the materials and methods will be known and should be compared to past similar projects. Network scheduling will begin, allowing a better understanding of the overall duration of the project as well as when each of the major project elements is to be constructed. Major assumptions should be noted and compared to what was assumed at the schematic design stage. ١٢ Design Development Phase Estimate The estimate at this stage is a tool used to verify that the design is within the owner’s budget, and to identify any good cost saving ideas.
- 7. Building Economy ARE 431 Dr. Mohammad A. Hassanain ١٣ Procurement Phase Estimate In this stage, an estimate would be prepared by all the contractors who are bidding for the construction of the project, as well as the project team. The contractors prepare the estimate to identify a price to bid. The owner team prepares an estimate to negotiate a fair price and to verify the accuracy of the contractor’s price. The estimate is prepared based on a complete set of contract documents. The contractors bidding for the project will break the project down into work packages. ١٤ Procurement Phase Estimate These work packages are: Work Package Cost Excavation Foundations Structural Steel Roofing Wall Systems Mechanical Systems Electrical Systems Finishes Total The contractor would request bids from pre-qualified subcontractors for each package. Most contractors will do some of the work with their own workforces and therefore will not request bids in these areas.
- 8. Building Economy ARE 431 Dr. Mohammad A. Hassanain ١٥ Procurement Phase Estimate Estimates done for bidding require a complete understanding of material quantities, which are taken from the drawings. Estimates also require accurate unit prices, which usually involves input from local material suppliers. An exact schedule will be prepared. This will be used to identify the duration of the project. Depending on the size of the project, a bid estimate can take three weeks or longer to prepare. These detailed estimates are extremely accurate. Usually, the difference between bidders is the profit margin that the contractors include.