Capital and whole life costs of buildings
KEY POINT: x Clear communication with clients from the beginning of the pro-
ject is vital x Changes made later in the project are more difficult and more
costly to implement than those made at an earlier stage x Maintenance and operational costs of a building dwarf the con-
struction costs x Whole life costing is a valuable tool to enhance decision mak-
ing, but can be heavily influenced by decisions on time-span and discounted cash flow
Contents 1 Introduction 2 Why are construction costs so important? 3 Procurement 4 New rules of measurement and cost estimating 5 Whole life costs 6 Conclusion
1 INTRODUCTION This chapter examines the relationship between cost and value in construction projects, and discusses why architects should pay particular attention to their client’s budgetary constraints. We also describe the degree of risk which clients accept when undertaking construction projects, and the steps which designers can take to mitigate these risks. In describing the estimating and cost planning process, we explain the discipline of the cost planning process, and the importance of the achievement of an appropriate level of fixity of design and specification at the conclusion of each RIBA project stage. We also describe the information that is available to cost consultants in preparing estimates at different project stages, and the degree of certainty that can be attached to these estimates.