DBN 352

Construction economics

APPROXIMATE
APPROXIMATEESTIMATES
ESTIMATES
 Cost estimate
□ Defined as an activity in a
particular work to make
possible offers to
execute a task based on
stipulated sum
□ Technique to forecast the
possible costs incurred for
a certain buildings/
construction projects via
systematic calculation
employing certain methods
 Purposes of cost estimate
□ To prepare at the preliminary stage of a project in
ascertaining the actual cost of the forecast
project
□ A design guide whether the project is higher
than the allocated sum for that particular project
 Cost estimate
□ In general, cost estimate can be divided into:
□Preliminary estimate:
□Unit
□Cubic
□Floor area
□Storey enclosure
□ The selection of methods will depend on:
□ The information and time to prepare the estimate
□ The experience of the QS
□ The total and type of cost data available
 Cost estimate methods
Metho When it Note Unit of
d is used? measuremen
t
Unit Inception Appropriate for projects Cost/ student
Feasibilit that have a standard unit Cost/classroom
y of accommodation. Cost/bed
It is commonly used to Cost/chair
establish the cost limit for
public sector projects.
Cubic Outline A method previously used Cost/m3
proposal by the architect.
This method is only used to
calculate the volume air-
conditioned space or space
which is given mechanical
ventilation
 Cost estimate methods
(Cont’d)
Method When it Note Unit of
is measuremen
used? t
Floor area Outline Still used extensively. A Cost/m2
proposal popular method and can be
used for almost all type of
buildings
Storey Scheme The method is no longer in Cost/storey
enclosure design practiced enclosure
 UNIT METHOD
□ Also referred to as ‘ cost according to building
function’
□ Used to estimate the building cost where size
depend on the population unit
□ The building is expressed in terms of
accommodation it provides, i.e.,
□Schools – cost per seat
□Hospitals – cost per bed
□Theatres – cost per seat
□Hostels – cost per bed
□Car parks – cost per parking space
 Unit method (Cont’d)
□ Example

Calculate the cost of the mosque for 450 people.

The cost is RM 1,400/ person
= Person x cost per person
= 450 person x RM 1,400/ person
= RM 630,000.00
 Unit method (Cont’d)
Advantages Disadvantages
1. Fast and 1. An unrefined method
easy and inaccurate
2. Easiest 2. Does not take into
method to account changes to
obtain plan, no of storey
cost limit and other factors
to prepare 3. Unrelated work
the concerning unit of
monetary accommodation has
allocations to be calculated
for several separately
years to
come
3. No
necessity
□for
Only suitable at the initial stages of a project
drawing
 Cubic method
□Cubic method is made up by taking plan dimension from the
outside faces of the bricks and vertical dimension from top of
foundation to halfway of pitched roof or 0.60m above flat roof

Volume = L x B x H

L= Length from the external face of external wall

B = Width from the external face of external wall
H = Height

Height of pitch roof – From the top surface of the foundation to

half apex/ height of roof

Height of flat roof - From the top surface of the foundation to

600mm above the flat roof/parapet wall (Whichever is higher)
 CUBIC METHOD (CONT’D)
□ Example

Calculate the cost of two (2) storey bungalow

house. The data cost given is RM 550.00/m3
Calculate the cost according to the:
□Pitched roof
□Flat roof
 Cubic method (cont’d)

1.50 m

20.00 m

3.50 m

10.00 m 115mm thk.

3.50 m

1.00 m
 Cubic method (cont’d)

Pitched roof
Volume of the building = 20.00m x 10.00m x [1.00m +
(3.50m x 2) + (1/2 x 1.50m)]
= 1750m3
Total cost of the building = volume x cost/m3
= 1750m3 x RM550.00/m3
= RM962,500.00

Flat roof
Volume of the building = 20.00m x 10.00m x
[1 + (3.50m x 2) + 0.60m]
= 1720m3
Total cost of the building = volume x cost/m3
= 1720m3 x RM550.00/m3
= RM946,000.00
 Cubic method (cont’d)
□Advantages and Disadvantages
Advantages Disadvantage
• Easy • Does not take into account changes
• Take only short to plan, height of storey and the
time overall height of the building
• Unrelated work to the volume has to
be calculated separately
• Difficult to obtain similar cost data
• Does not help the architect in design
work as it is difficult to predict / to
know the effect of changes to
specification, design, etc per m3
 Floor area method
□ Only building uses this floor area
method
Total cost = Area x Cost/m2 Gross
Floor Area (GFA)
Cost/m2 GFA – From similar
building type and function
 Floor area method (Cont’d)

□ Example
Calculate the cost of the building
based on the plan given. The cost
based on the similar project, which is
RM 1,500/m2
25.00m 25.00m

10.00m 5.00m
5.00m
3.00m
15.00m
7.00m
10.00m
10.00m 3.00m

GROUND FLOOR 5.00m UPPER FLOOR

Floor area method (Cont’d)

□ Ground floor
25.00m x 2.00m = 50.00 m2
10.00m x 3.00m = 30.00 m2
5.00m x 7.00m = 35.00 m2
115.00 m2
Upper floor
25.00m x 5.00m = 125.00 m2
10.00m x 3.00m = 30.00 m2
155.00 m2

Cost = Area x Cost/m2 Floor Area

= 270.00 m2 x RM1,500/m2
= RM405,000.00
 Floor area method (Cont’d)
□Advantages and Disadvantages
Advantages
• The client and the architect
easily understand the
concept of floor area.
• Easy and fast
• Cost data are easily
available as most of the
data from previous projects
mostly utilise this method
Disadvantage
• Does not take into account
differences in plan, storey
height or overall height of
the building
• External works, piling and
others are not included and
must be calculated
separately
• It is difficult to calculate and
allocate the cost for
different site conditions,
quality of materials,
conditions of the contract
 Storey enclosure
method (Cont’d)
□ An adaptation of the single price rate method,
which attempted to make the area method
more realistic
□ The areas were given certain weighting and
then added together and priced at a single rate.
This represented more accurately and varying
heights of the storey
 Storey enclosure method
(Cont’d)
Example
□Calculate the total cost of this
building if the cost/m2 is RM
450.00 10.00 m

3.00 m

15.00 m Eaves 450mm

3.00 m
115mm thk.

3.00 m

4.00 m
 Storey enclosure method
(Cont’d)
I. Floor area = L [15.00m – (0.115m x 2)] x W [10.00m – (0.115m x
2)]
= (15.00m – 0.23m) x (10.00m – 0.23m)
= 14.77m x 9.77m
= 144.30 m2

Area (m2) = Area x Factor

Ground floor = 144.30 m2 x 2.00 = 288.60
1st floor = 144.30 m2 x 2.15 = 310.25
2 floor = 144.30 m x 2.30 = 331.89
nd 2

Basement = 144.30 m2 x 3.00 = 432.90

TOTAL 1363.64 m2

II. Roof area = L [15.00m + (0.45m x 2)] x W [10.00m + (0.45m x

2)]
= (15.00m + 0.90m) x (10.00m + 0.90m)
= 15.90m x 10.90m
= 173.31 m2
 Storey enclosure method
(Cont’d)
III.External wall = Girth x Factor x Height
Ground floor = [(15.00m + 10.00m) x 2] x 3.00m = 150.00
1st floor = [(15.00m + 10.00m) x 2] x 3.00m = 150.00
2nd floor= [(15.00m + 10.00m) x 2] x 3.00m = 150.00
Basement = [(15.00m + 10.00m) x 2] x 4.00m x 2.0 = 400.00
TOTAL = 850.00 m2

□ Total area = 1363.64 m2 + 173.31 m2 + 850.00 m2

= 2386.95 m2

□ Total cost = Total of storey enclosure x Cost/m2

= 2386.95 m2 x RM450.00
= RM1,074,127.50
 Storey enclosure method
(Cont’d)
□Advantages and Disadvantages
Advantages
• Faster than the approximate
quantities method and is
more accurate/ realistic
compared to other
preliminary estimate
• It can be produce better
comparison between single
storey and multi-storey
buildings
Disadvantage
• It is not easy to find the
price rate
• Cost that are not included in
the price rate must be
calculated separately
• Requires much calculation
• Conveys no meaning to
client