Introduction to Construction Cost

A. Types of Construction Cost

B. Preliminary Estimates; Cost per sqm
C. Stipulated sum/Unit Price; Cost plus;
D. Estimating Formats
E. Work Breakdown Structure (WBS)
F. CSI Master Format
G. Cost Estimating components
 CONSTRUCTION COST
 Construction Cost means the total cost of the work to the owner of all
elements of the project designed or specified by the design professional
including the cost at current market rates of labor and materials furnished
by the owner and equipment designed, specified or specifically provided by
the design professional.

• What is Cost and Project Cost Management?

 Cost is a resource sacrificed or foregone to achieve a specific objective or

something given up in exchange
 Costs are usually measured in monetary units like dollars
 Project cost management includes the processes required to ensure that the
project is completed within an approved budget
 Basic Principles of Cost Management

1. Most CEOs and boards know a lot more about finance

than IT, so IT project managers must speak their language
2. Profits are revenues minus expenses
3. Life cycle costing is estimating the cost of a project plus
the maintenance costs of the products it produces
4. Cash flow analysis is determining the estimated annual
costs and benefits for a project
5. Benefits and costs can be tangible or intangible, direct or
indirect
6. Sunk cost should not be a criterion in project selection
 Tangible costs or benefits are those costs or benefits that an organization can easily
measure in dollars.
 Intangible costs or benefits are costs or benefits that are difficult to measure in monetary
terms.
 Direct costs are costs that can be directly related to producing the products and services
of the project.
 Indirect costs are costs that are not directly related to the products or services of the
project but are indirectly related to performing the project.
 Sunk cost is money that has been spent in the past; when deciding what projects to invest
in or continue, you should not include sunk costs.
 Learning curve theory states that when many items are produced repetitively, the unit
cost of those items decreases in a regular pattern as more units are produced.
 Reserves are dollars included in a cost estimate to mitigate cost risk by allowing for future
situations that are difficult to predict.
 Contingency reserves allow for future situations that may be partially planned for
(sometimes called known unknowns) and are included in the project cost baseline.
 Management reserves allow for future situations that are unpredictable (sometimes
called unknowns).
 Types of Construction Costs:

 Capital Cost:
 Expenses related to the initial establishment of the facility:
Land acquisition, including assembly, holding and improvement
Planning and feasibility studies
Architectural and engineering design
Construction, including materials, equipment and labor
Field supervision of construction
Construction financing
Insurance and taxes during construction
Owner's general office overhead
Equipment and furnishings not included in construction
Inspection and testing
 Operating and Maintenance Cost:
The operation and maintenance cost in subsequent years over the
project life cycle includes the following expenses:
Land rent, if applicable
Operating staff
Labor and material for maintenance and repairs
Periodic renovations
Insurance and taxes
Financing costs
Utilities
Owner's other expenses
 The magnitude of each of these cost components depends on the nature, size and location of the
project as well as the management organization, among many considerations. The owner is
interested in achieving the lowest possible overall project cost that is consistent with its
investment objectives.

Contingencies provisions:

 In most construction budgets, there is an allowance for contingencies or unexpected costs

occurring during construction. This contingency amount may be included within each cost
item or be included in a single category of construction contingency
 The amount of contingency is based on historical experience and the expected difficulty of a
particular construction project
 For example, one construction firm makes estimates of the expected cost in five different
areas:
 Design development changes,
 Schedule adjustments,
 General administration changes (such as wage rates),
 Differing site conditions for those expected, and
 Third party requirements imposed during construction, such as new permits.
 Project Cost Management

 Project Cost Management includes the processes involved in

planning, estimating, budgeting, and controlling costs so that the
project can be completed within the approved budget.
 Cost Estimating – developing an approximation of the costs of the
resources needed to complete project activities.
 Cost Budgeting – aggregating the estimated costs of individual
activities or work packages to establish a cost baseline.
Cost Control – influencing the factors that create cost variances and
controlling changes to the project budget
 Cost Budgeting

 Cost budgeting involves aggregating the estimated costs of individual schedule

activities or work packages to establish a total cost baseline for measuring project
performance.
 Cost Aggregation
 Schedule activity cost estimates are aggregated by work packages in accordance
with the WBS.
 Reserve Analysis
 Reserve analysis establishes contingency reserves, such as the management
contingency reserve, that are allowances for unplanned, but potentially required,
changes. Such changes may result from risks identified in the risk register.
 Funding Limit Reconciliation
 Large variations in the periodic expenditure of funds are usually undesirable for
organizational operations. Therefore, the expenditure of funds is reconciled with
the funding limits set by the customer or performing organization on the
disbursement of funds for the project.
 Cost Budgeting: Outputs

 Cost Baseline
 The cost baseline is a time-phased budget
that is used as a basis against which to
measure, monitor, and control overall cost
performance on the project.
 Project Funding Requirements
 Funding requirements, total and periodic
(e.g., annual or quarterly), are derived from
the cost baseline and can be established to
exceed, usually by a margin, to allow for
either early progress or cost overruns.
 Funding usually occurs in incremental
amounts that are not continuous, and,
therefore, appears as a step function.
 Cost Control
 Project cost control includes:
 Influencing the factors that create changes to the cost baseline
 Ensuring requested changes are agreed upon
 Managing the actual changes when and as they occur
 Assuring that potential cost overruns do not exceed the authorized
funding periodically and in total for the project
 Monitoring cost performance to detect and understand variances
from the cost baseline
 Recording all appropriate changes accurately against the cost
baseline
 Preventing incorrect, inappropriate, or unapproved changes from
being included in the reported cost or resource usage
 Informing appropriate stakeholders of approved changes
 Acting to bring expected cost overruns within acceptable limits.
 Cost Control Inputs:

 Cost Baseline
 Project Funding Requirements
 Performance Reports
 Work Performance Information
 Approved Change Requests
 Project Management Plan
 Cost Change Control System
 A cost change control system, documented in the cost
management plan, defines the procedures by which the
cost baseline can be changed.
 Performance Measurement Analysis
 Performance measurement techniques help to assess the
magnitude of any variances that will invariably occur.
 The earned value technique (EVT) compares the
cumulative value of the budgeted cost of work performed
(earned) at the original allocated budget amount to both
the budgeted cost of work scheduled (planned) and to the
actual cost of work performed (actual).
 This technique is especially useful for cost control,
resource management, and production
 Cost Change Control System
 A cost change control system, documented in the cost
management plan, defines the procedures by which the
cost baseline can be changed. It includes the forms,
documentation, tracking systems, and approval levels
necessary for authorizing changes.
 Performance Measurement Analysis
Performance measurement techniques help to assess the
magnitude of any variances that will invariably occur. The
earned value technique (EVT) compares the cumulative
value of the budgeted cost of work performed (earned) at
the original allocated budget amount to both the budgeted
cost of work scheduled (planned) and to the actual cost of
work performed (actual). This technique is especially useful
for cost control, resource management, and production
 Cost Change Control System
 A cost change control system, documented in the cost management plan,
defines the procedures by which the cost baseline can be changed. It includes
the forms, documentation, tracking systems, and approval levels necessary
for authorizing changes.
 Performance Measurement Analysis
Performance measurement techniques help to assess the magnitude of any
variances that will invariably occur. The earned value technique (EVT)
compares the cumulative value of the budgeted cost of work performed
(earned) at the original allocated budget amount to both the budgeted cost of
work scheduled (planned) and to the actual cost of work performed (actual).
This technique is especially useful for cost control, resource management, and
production
EVM: Earned Values Management

 The Earned Value Technique ( EV) involves developing these key values for each
schedule activity, work package, or control account:
 It is a method measuring project performance by comparing the amount of work
planned with accomplished, in order to determine if cost and schedule
performance as planned.
 Estimating construction projects requires
fluency in the language and symbols used in
construction plans. This chapter provides an
overview of a project’s working drawings and
plans. It does not offer detailed instruction in
plan reading but reviews the organization of the
plans and the information necessary for
estimating.
 Unit Cost Method of Estimation

 If the design technology for a facility has been specified, the project can be decomposed
into elements at various levels of detail for the purpose of cost estimation.

 The unit cost for each element in the bill of quantities must be assessed to compute the
total construction cost. This concept is applicable to both design estimates and bid
estimates, although different elements may be selected in the decomposition.

 For design estimates, the unit cost method is commonly used when the project is
decomposed into elements at various levels of a hierarchy as follows:

 Preliminary Estimates. The project is decomposed into major structural systems or

production equipment items, e.g. the entire floor of a building or a cooling system for a
processing plant.
 Detailed Estimates. The project is decomposed into components of various major systems,
i.e., a single floor panel for a building or a heat exchanger for a cooling system.

 Engineer's Estimates. The project is decomposed into detailed items of various

components as warranted by the available cost data. Examples of detailed items are slabs
and beams in a floor panel, or the piping and connections for a heat exchanger.
 Computer Aided Cost Estimation

 Some of the common features of computer aided cost estimation software include:
 Databases for unit cost items such as worker wage rates, equipment rental or material prices. These
databases can be used for any cost estimate required. If these rates change, cost estimates can be
rapidly re-computed after the databases are updated.
 Databases of expected productivity for different components types, equipment and construction
processes.
 Import utilities from computer aided design software for automatic quantity-take-off of
components. Alternatively, special user interfaces may exist to enter geometric descriptions of
components to allow automatic quantity-take-off.
 Export utilities to send estimates to cost control and scheduling software. This is very helpful to
begin the management of costs during construction.
 Version control to allow simulation of different construction processes or design changes for the
purpose of tracking changes in expected costs.
 Provisions for manual review, over-ride and editing of any cost element resulting from the cost
estimation system
 Flexible reporting formats, including provisions for electronic reporting rather than simply printing
cost estimates on paper.
Archives of past projects to allow rapid cost-estimate updating or modification for similar designs
 Components of Project Cost Estimates for Major
Projects

 Preliminary Engineering. This is the cost to prepare the

construction documents.
 Right-of-Way. This is the cost to research and acquire
right-of-way for the project, including easements. Include
right-of-way costs for storm water management, wetland
mitigation, and other work outside the roadway prism.
 External Third Party (e.g. Utilities and Railroad
Adjustments). Perhaps the most difficult costs to estimate
are those that are associated with third parties, such as
utilities and railroads.
 Components of Project Cost Estimates for Major
Projects

 Preliminary Engineering. This is the cost to prepare the

construction documents.
 Right-of-Way. This is the cost to research and acquire
right-of-way for the project, including easements. Include
right-of-way costs for storm water management, wetland
mitigation, and other work outside the roadway prism.
 External Third Party (e.g. Utilities and Railroad
Adjustments). Perhaps the most difficult costs to estimate
are those that are associated with third parties, such as
utilities and railroads.
COSTS ASSOCIATED WITH CONSTRUCTED FACILITIES

The costs of a constructed facility to the owner include both: the initial capital
cost and the subsequent operation and maintenance costs. Each of these major
cost categories consists of a number of cost components. The capital cost for a
construction project includes the expenses related to the initial establishment
of the facility:
Land acquisition, including assembly, holding and improvement.
Planning and feasibility studies
Architectural and engineering design
Construction, including materials, equipment, and labor.
Field supervision of construction
Construction financing
Insurance and taxes during construction.
Owner's general office overhead
Equipment and furnishings not included in construction.
Inspection and testing
COSTS ASSOCIATED WITH CONSTRUCTED FACILITIES

The costs of a constructed facility to the owner include both: the initial capital
cost and the subsequent operation and maintenance costs. Each of these major
cost categories consists of a number of cost components. The capital cost for a
construction project includes the expenses related to the initial establishment
of the facility:
Land acquisition, including assembly, holding and improvement.
Planning and feasibility studies
Architectural and engineering design
Construction, including materials, equipment, and labor.
Field supervision of construction
Construction financing
Insurance and taxes during construction.
Owner's general office overhead
Equipment and furnishings not included in construction.
Inspection and testing
 The magnitude of each of these cost components depends on:
 the nature, size, and location of the project the management organization,
among many considerations.
 The owner is interested in achieving the lowest possible overall project cost that
is consistent with its investment objectives.

Cost estimating is one of the most important steps in project management.

 A cost estimate establishes the base line of the project cost at different stages of
development of the project.
 A cost estimate at a given stage of project development represents a prediction
provided by the cost engineer or estimator based on available data.
 According to the American Association of Cost Engineers, COST ENGINEERING is
defined as that area of engineering practice where engineering judgement and
experience are utilized in the application of scientific principles and techniques to
the problem of cost estimation, cost control and profitability.
 Virtually all cost estimation is performed according to one or some combination of
the following basic approaches:
A. PRODUCTION FUNCTION - In construction, the production function may be expressed by the
relationship between the volume of construction and a factor of production such as labor or
capital.
 The relationship between the size of a building project (expressed in square meter) to the input
labor (express in labor hours per square meter) and capital is an example of a production function
of construction.

EXAMPLE 1. It is required to estimate the cost of construction for five story building including
foundations with 300 square meters given that the cost of construction of a similar building with
500 square meter and three stories including foundations is Php 50000.00.

SOLUTION:
Assume the foundations are considered a regular floor, then we have 4 floors.
Cost of one floor – 500000/4 = 125000.00
Cost per square meter = 12500/500 = 250.00

New building:
We have 5 floors + 1 (foundation) = 6floors x total area = 6x300 = 1800 square meter
Cost of the new building = 1800x250 = 450000.00
A. UNIT COST FOR BILL OF QUANTITIES
A unit cost is assigned to each of the facility components or tasks
as represented by the bill of quantities.
The total cost is the summation of the products of the
quantities multiplied by the corresponding unit costs.
 The unit cost method is straightforward in principle but quite
laborious in application.
 The initial step is to break down or disaggregate a process into a
number of tasks.
 Collectively, these tasks must be completed for the construction of
a facility.
 Once these tasks are defined and quantities representing these
tasks are assessed, a unit cost is assigned to each and then the total
cost is determined by summing the costs incurred in each task.
 B. ALLOCATION OF JOINT COTS
 The basic idea in this method is that each expenditure item can be
assigned to characteristics of the operation.

Ideally, the allocation of joint costs should be causally related

to the category of basic costs in an allocation process. In many
instances, however, a causal relationship between the
allocation factor and the cost item cannot be identified or may
not exist.

For example, in construction projects the accounts for basic costs

may be classified according to labor, material, construction
equipment, construction supervision and general office overhead.
These basic costs may then be allocated proportionally to various
tasks which are subdivisions of a project.
 Example: The following project is composed of 7 Activities (work items). Assigned
to each item the volume of work, direct cost (Labor, Material, equipment, and
subcontractor) It is required to estimate the total cost of each item, and the unit
price. Assume indirect cost 20% of the direct cost
ITE DESCRIPTIO UNI QTY DIRECT COST
M N T
NO.

LABOR MATERIALS EQUIPMENT SUBCONTRACTOR

1 EXCAVATION M³ 300 1500 0 3500 0
2 PLAIN 100 1000 8000 1000 0
CONCRETE
3 REINFORCED 300 6000 22000 8000 0
CONCRETE
4 BRICK WORKS 200 3000 26000 40000 0
0
5 PLASTER 300 0 0 0 12000
WORKS 0
6 INTERIOR 250 0 0 0 18000
PAINTING 0
7 BACKFILL 300 4000 0 2000 0
Ite Descriptio Un Qty Direct cost
m n it
no.

LABO MATE EQUIP SUBCON DIREC IND. ITEM UNIT

R RIALS MENT TRACTO T COST COST PRICE
R COST

1 Excavation M³ 300 1500 0 3500 0 5000 1000 6000 20

2 Plain M³ 100 1000 8000 1000 0 10000 2000 12000 120

concrete
3 Reinforced M³ 300 6000 22000 8000 0 36000 7200 43200 144
concrete
4 Brick works M2 2000 3000 26000 4000 0 33000 6600 39600 198

5 Plaster M³ 3000 0 0 0 12000 12000 2400 14400 4.8

works
6 Interior M2 2500 0 0 0 18000 18000 3600 21600 8.64
painting
7 Backfill M³ 300 4000 0 2000 0 6000 1200 7200 24
TYPES OF COSNTRUCTION COST ESTIMATES
Level of Accuracy
The required levels of accuracy of construction cost estimates vary at different stages of
project development, ranging from ballpark figures in the early stage to reliable figures for
budget control prior to construction. Since design decisions made at the beginning stage
of a project life cycle are more tentative than those made at a later stage, the cost
estimates made at the earlier stage are expected to be less accurate. Generally, the
accuracy of a cost estimate will reflect the information available at the time of estimation.
Construction cost estimates may be viewed from different perspectives because of different
institutional requirements.
Despite the many types of cost estimates used at different stages of a project, cost
estimates can best be classified into three major categories according to their functions.

A construction cost estimate serves one of the three basic functions:

Design
Bid
And control
 For establishing the financing of a project, either a design estimate or a bid estimate
is used.
1. DESIGN ESTIMATES - For the owner or its designated design professionals, the
types of cost estimates encountered run parallel with the planning and design as
follows:
Screening estimates (or order of magnitude estimates)
Preliminary estimates (or conceptual estimates)
Detailed estimates
Engineers’ estimates based on plans and specifications.

For each of these different estimates, the amount of design information available
typically increases.
2. BID ESTIMATES - For the contractor, a bid estimate submitted to the owner either for
competitive bidding or negotiation consists of direct construction cost including field
supervision, plus a markup to cover general overhead and profits. The direct cost of
construction for bid estimates is usually derived from a combination of the following
approaches.
Subcontractor quotations
Quantity takeoffs
Construction procedures
3. CONTROL ESTIMATES – for monitoring the project during construction, a control estimate is
derived from available information to establish:
Budget estimate for financing
Budgeted cost after contracting but prior to construction.
Estimated cost to completion during the progress of construction.

4. DESIGN ESTIMATES - In the planning and design stages of a project, various design estimates
reflect the progress of the design.
 At the very early stage, the screening estimate or order of magnitude estimate is usually made
before the facility is designed and must therefore rely on the cost data of similar facilities built
in the past. A preliminary estimate or conceptual estimate is based on the conceptual design of
the facility at the state when the basic technologies for the design are known.
 The detailed estimate of definitive estimate is made when the scope of work is clearly defined,
and the detailed design is in progress so that the essential features of the facility are
identifiable.
 The engineer’s estimate is based on the completed plans and specifications when they are
ready for the owner to solicit bids from construction contractors.
 In preparing these estimates, the design professional will include expected amounts for
contractors overhead and profits.
5. BID ESTIMATES
The contractor's bid estimates often reflect the desire of the contractor to secure the
job as well as the estimating tools at its disposal.
Some contractors have well-established cost-estimate procedures while others do
not. Since only the lowest bidder will be the winner of the contract in most bidding
contests, any effort devoted to cost estimating is a loss to the contractor who is not a
successful bidder.
Consequently, the contractor may put in the least amount of possible effort into
making a cost estimate if it believes that its chance of success is not high.
If a general contractor intends to use subcontractors in the construction of a facility,
it may solicit price quotations for various tasks to be subcontracted to specialty
subcontractors.
Thus, the general subcontractor will shift the burden of cost estimating to
subcontractors.
If all or part of the construction is to be undertaken by the general contractor, a bid
estimate may be prepared based on the quantity takeoffs from the plans provided by
the owner or based on the construction procedures devised by the contractor for
implementing the project.
 For example, the cost of a footing of a certain type
and size may be found in commercial publications
on cost data which can be used to facilitate cost
estimates from quantity takeoffs.
 However, the contractor may want to assess the actual
cost of construction by considering the actual
construction procedures to be used and the associated
costs if the project is deemed to be different from typical
designs.
 Hence, items such as labor, material and equipment
needed to perform various tasks may be used as
parameters for the cost estimates.
6. CONTROL ESTIMATES
Both the owner and the contractor must adopt some base line for cost
control during the construction.
For the owner, a budget estimate must be adopted early enough for planning
long term financing of the facility.
Consequently, the detailed estimate is often used as the budget estimate
since it is sufficient definitive to reflect the project scope and is available
long before the engineer's estimate. As the work progresses, the budgeted
cost must be revised periodically to reflect the estimated cost to completion.
A revised estimated cost is necessary either because of change orders
initiated by the owner or due to unexpected cost overruns or savings.
For the contractor, the bid estimate is usually regarded as the budget
estimate, which will be used for control purposes as well as for planning
construction financing. The budgeted cost should also be updated
periodically to reflect the estimated cost of completion as well as to ensure
adequate cash flows for the completion of the project.
PRELIMINARY ESTIMATE
Preliminary estimates are a technique for predicting the possible cost incurred for a
building or construction project through a systematic calculation and preparing at early
stage of the project. The purpose of preliminary estimate is to determine the actual cost
forecast of a project and help the client to understand how much money he needs to
invest in a particular project (Wahab, 2013).
Preliminary estimates can be done before the detailed drawings are being provided.
It is to give an insight into the cost of the proposed project before detailed plans come
out (Lou, 2018). If the preliminary estimate is higher than the client’s budget, the design
could be changed to reduce the cost, or the project may be cancelled or postponed. At the
same time, there are possibility for the preliminary estimate lower than the allocated
sum, the design or specification could be modified in to increase the estimation to the
provision set aside or accept the estimate (Wahab, 2013).
There are various methods for calculating the preliminary estimate such as price per
unit, price per unit area, price per unit volume, approximately quantities and detailed
estimates. The selection of the method will depend on the information and time to
prepare the estimate and the total and type of cost data that available (Wahab, 2013).
 METHOD OF ESTIMATING
 PRICE PER UNIT METHOD
Price per unit is the simplest method of estimating the cost of a proposed
construction project. It is suitable for project that have standard unit of accommodation
which commonly used to determine the cost limit for public project. This method also
known as ‘cost according to building function’. It estimates the building cost depend on
the number of units which are going to be accommodated in a building. The cost
estimate is obtained by multiplying the number of accommodations for a new building
with the cost per unit of accommodation based on a suitable building. The current unit of
accommodation can be obtained by calculating from the sketch design or from the client.
The price per unit can be calculated by using formula below (Wahab, 2013):
Total Estimated Cost of Building Project = Number of Unit X Cost per Unit
 PRICE PER UNIT AREA METHOD

Price per unit area is used during outline proposal. It can be used for almost all
types of building. The cost data provided by the developer, quantity surveyors and
building societies, the construction cost per square metre may be differ by region,
type of building and location. The rate of per square metre must be current rate as
building cost often differ. The measurement for gross floor area must be similar
between the analysed building and new building. The external work, the quantity
and quality of equipment and others that related to the floor area must be
calculated separately. The difficulty of this method is to choose the appropriate
rate, which requires experience, observation and familiarity toward varied
building types. The price per unit area can be calculated by using the formula
below (Wahab, 2013):
Total Estimated Cost of Building = Internal Gross Floor Area of Building X
Cost per m2
 PRICE PER UNIT VOLUME METHOD

Price per unit volume is used during outline proposal. It is used to calculate
the volume of space which is given mechanical ventilation and air-conditioned
space. This method measures the volume of the new building and its volume and
then multiply with the price rate per m3. The unrelated works must be calculated
separately. The preliminary estimate can be prepared quickly by using this
method. However, this method has seldom been used in Malaysia because of the
difficulty to obtain similar cost data as only in certain cases like to calculate the
space which needs to be air-conditioned or mechanical ventilation. The formula
for the calculation of price per unit volume of building is as below (Wahab, 2013):

Total Estimated Cost of Building = Volume of building X Cost per m 3

 APPROXIMATE QUANTITIES METHOD

Approximate quantities method is the most common method because it

provides a more accurate and reliable cost estimate. This method requires
advanced drawings because enough information is required for building up
composite rates. This method is based on measurement groups where bill items
with the same dimension like in metres or square metres are grouped together.
This essentially means that items occupying the same area or perimeter are
measured together at once using a group unit of measurement. However, this
method takes a long time to prepare than other methods (Estimating Method,
2017).

Total Estimated Cost of Building = Total Cost of All Work Groups

 DETAILED ESTIMATES METHOD

Detailed estimates method includes determination of the quantities and cost of everything that is
required to complete the project which consists of labour, equipment, materials, profit and others. The
estimator must have a complete set of contract document such as specification, drawings, analysis of
rate, report and others in order to use this type of method (Tran, 2013). Generally, 3% - 5% of the
estimated cost is added to cover miscellaneous expenditure. According to Hanna (2015), there are 7
steps to develop a detailed estimate which are.

a) Study the project documents.

b) Develop work breakdown structure (WBS) and cost code.
c) Determine quantity take off.
d) Price labour, equipment, and materials
e) Define work done by others and obtain quotation.
f) Determine job overhead cost.
g) Determination of mark up
- Mark up is an allowance for contingency, home office overhead and profit. Generally, the mark up
range is from 5% to 20% of the total project costs.
 UNITS OF MEASUREMENTS

The units of measurements are mainly categorized for their nature,

shape and size and for making payments to the contractor.

a) Single units work like doors, windows etc, is expressed in numbers.

b) Works consists linear measurements involve length like cornice, fencing,
hand rail etc., are expressed in running meters (RM)
c) Works consists areal surface measurements like plastering, white
washing, partitions of specified thickness etc., are expressed in square
meters.
d) Works consists cubical contents which involve volume like earth work,
cement concrete, Masonry etc., are expressed in Cubic meters.
 NEED OF ESTIMATION & COSTING

1. It helps to work out the approximate cost of the project in order to decide its
feasibility with respect to the cost and to ensure the financial resources.
2. Requirements of controlled materials, such as cement and steel can be estimated.
3. It is used for framing the tenders for the works and to check contractor’s work
during and after the its execution for the purpose of making payments to the
contractor.
4. From quantities of different items of work calculated in detailed estimation,
resources are allocated to different activities of the project and ultimately their
durations and whole planning and scheduling of the project is carried out.
 DATA REQUIRED TO PREPARE AN ESTIMATE

1) DRAWINGS
If the drawings are not clear and without complete dimensions the preparation of
estimation become very difficult. So, it is very essential before preparing an
estimates
2) SPECIFICATIONS
a) General Specifications:
This gives the nature, quality of work and materials in general terms to be used in
various parts of work. It helps to form a general idea of building.
b) Detailed Specifications:
This gives the detailed description of the various items of work laying down the
Quantities and qualities of materials, their proportions, the method of preparation
workmanship and execution of work.
3) RATES
For preparing the estimate the unit rates of each item of work are required.
1. For arriving at the unit rates of each item.
2. The rates of various materials to be used in the construction.
3. The cost of transport materials.
4. The wages of labor, skilled or unskilled of masons, carpenters, Amador,
etc.,

LUMPSUM:
While preparing an estimate, it is not possible to work out in detail in case of
petty items. Items other than civil engineering such items are called lump
sum items or simply L.S.Items.
 Factors to be considered for estimation:

1. Each type of work requires a different method of construction. Construction may be of

an ordinary house or office and it may also be of a Dam, Tunnel, Multistory building,
Airport, Bridge, or a Road, already in operation. Each of these works requires totally
different construction techniques, type of machinery, and formwork.
2. Quality of labour and labour output varies in different localities.
3. Weather conditions greatly affect the output and, hence, the overall cost
4. Ground conditions vary and change the method of construction. For example,
excavation may be dry, wet, hard, soft, shallow or deep requiring different efforts.
5. The source of availability of a sufficient supply of materials of good quality.
6. The availability of construction machinery also affects the method of construction.
7. Access to the site must be reasonable. If the access is poor, temporary roads may be
constructed.
TYPES OF ESTIMATES

There are two main types of

estimates:

1. Rough (or) approximate estimate.

2. Detailed estimate
 Rough (or) approximate estimate

 Preliminary or approximate estimate is required for studies of various

aspects of work of project and for its administrative approval.
 It can decide, in case of commercial projects, whether the net income
earned justifies the amount invested or not. The approximate estimate
is prepared from the practical knowledge and cost of similar works.
 The following are the methods used for preparation of approximate
estimates.
1) Plinth area method
2) Cubical contents methods
3) Unit base method.
1) Plinth area method
cost of construction = Plinth area x plinth area rate.
2) Cubical Contents Method
It is more accurate that the other two methods viz., plinth area method
and unit base method.
cost of construction = Total cubical contents x Local Cubic Rate.
3) Unit Base Method
. For public buildings, cost. Per person (cost per capita) is used.
For example,
Students hostel - cost per student
Hospital - Cost per bed
Hotel - Cost per Guest
 DETAILED ESTIMATE

Detailed estimates are prepared by carefully and separately calculating the

costs of various item of the work that constitute the whole project from the
detailed working drawings after the design has been finalized.
The mistakes, if any, in the rough cost estimate are eliminated in the detailed
estimate.
Detailed estimates are submitted to the competent authorities for obtaining
technical sanction.
The whole project is sub-divided into different items of work or activities. The
quantity for each item is then calculated separately from the drawings as accurately
as possible. The procedure is known as "taking out of quantities".
The quantities for each item may be estimated and shown in the pattern which is
called "Bill of quantities."
The unit, in which each item of the wok is to be calculated, should be according to
the prevailing practice as followed in various departments of the country.
 METHODS OF DETAILED ESTIMATE

 The dimensions, length, breadth and height or depth are to be

taken out from the working drawings (plan, elevation and
section).
 Junctions of walls, corners and the meeting points of walls
require special attention.
 For symmetrical footings, which is the usual case, earthwork in
excavation in foundations, foundation concrete, brickwork in
foundation and plinth, and brickwork in superstructure may be
estimated by either of the two methods:
(1) LONG WALL & SHORT WALL METHOD
(2) CENTER LINE METHOD
LONG WALL & SHORT
WALL METHOD (or)
SEPARATE WALL
METHOD
• The walls running in one direction are termed as "long walls” and the walls running
in the transverse direction, as "Short walls.
• Lengths of long walls are measured or found "Out-to out" and those of short walls
as "In-to-in".
• Different quantities are calculated by multiplying the length by the breadth and the
height of the wall.

LONG WALL & SHORT WALL METHOD

• Long wall length out-to-out
= Center to center length + half breadth on one Side + half breadth on other
side.
= Center to center length + one breadth
• Short wall length in-to-in
= Center to Center length - one breadth.
 CENTER LINE METHOD

 In this method, total length of center lines of walls, long and short, has to be found
out.
 In this method, the length will remain the same for excavation in foundations, for
concrete in foundations, for all footings, and for superstructure (with slight
difference when there are cross walls or number of junctions).
 This method is quicker but requires special attention and considerations at the
junctions, meeting points of partition or cross walls.
 For rectangular, circular polygonal (hexagonal, octagonal etc.,) buildings having no
inter or cross walls, this method is quite simple.
 For buildings having cross or partition walls, for every junction, half breadth of the
respective item or footing is to be deducted from the total center length.
 Thus in the case of a building with one partition wall or cross wall having two
junctions, deduct one breadth of the respective item of work from the total center
length.
 CENTER LINE METHOD
 In this method, total length of center lines of walls, long and short, has to be found
out.
 In this method, the length will remain the same for excavation in foundations, for
concrete in foundations, for all footings, and for superstructure (with slight
difference when there are cross walls or number of junctions).
 This method is quicker but requires special attention and considerations at the
junctions, meeting points of partition or cross walls.
 For rectangular, circular polygonal (hexagonal, octagonal etc.,) buildings having no
inter or cross walls, this method is quite simple.
 For buildings having cross or partition walls, for every junction, half breadth of the
respective item or footing is to be deducted from the total center length.
 Thus in the case of a building with one partition wall or cross wall having two
junctions, deduct one breadth of the respective item of work from the total center
length.
 Problem-1
Estimate in detail the quantities of following
items of work for a given plan and section as
shown in Fig.1 using Centre line method and
Long wall & short wall method.
 Concrete in foundation
 Brickwork in 1st step in foundation
 First class brickwork in super structures
Center Line method:
Total Length of Center Line
= 5.3+5.3+4.3+4.3 = 19.2 m
width of foundation = 0.9 m Total
quantity of concrete in foundation
=19.2x0.9x0.3 cu.m = 5.184 cu.m.