Planning a Construction Budget That Holds

Ask any developer about their last project and the conversation usually turns to cost. Overruns are common, but they are rarely caused by a single event on site. In most cases the budget was fragile from the start: based on too little information, missing key items or carrying no realistic allowance for risk.

Start with the right level of estimate

A concept-stage estimate and a pre-tender estimate are different tools. Early on, cost per square metre benchmarks are useful to test feasibility. As the design develops, the estimate should move to an elemental cost plan, then to measured quantities. Treating an early benchmark as a fixed budget is the most common mistake we see.

Price what is easy to forget

Budgets often cover the building itself and little else. A robust budget also includes:

• External works, landscaping and boundary walls
• Utility connections and authority fees
• Design, supervision and permit costs
• Furniture, fixtures and equipment
• Escalation for long programmes
• Financing costs during construction

Hold a real contingency, and manage it

Contingency is not padding. It is a deliberate allowance for unknowns, typically higher at concept stage and reducing as the design and ground conditions become clear. Track it as a separate line, record every draw-down and report what remains every month.

Value engineer early, not at tender

The cheapest time to save money is during design. Reviewing structural systems, façade options and MEP strategies at each design stage can deliver meaningful savings without reducing quality. Cutting scope after tenders come in high usually costs time and produces a worse building.

At GES, our estimators work alongside designers and site teams from feasibility to final account. If you are planning a project and want a budget you can rely on, talk to our cost management team.