Posted on 6th September 2022

What Are the Invisible Costs of Managing a Building Project?

Building Project Costs

Building projects aren’t always smooth sailing and there are often times when unforeseen circumstances take over. From bad weather to supply issues, bumps in the road are bound to happen. In truth, most contractors anticipate that up to 30% of their projects are subject to delays, adding cost and frustrations to many builds.

As well as unplanned events, building projects commonly run over budget and it’s not all down to delays. There are hidden costs to managing a building project but if you know when and where to expect them, you can factor these into your planning and budgeting.

 

Someone to manage the project

The first hidden cost for many building projects is simply appointing a manager or management company to look after the project. While many feel they have the ability to self-manage the project, without the proper experience this can be an error.

Even if a project manager has been budgeted for or appointed, there are still hidden costs associated with this element of a building operation. Choosing the right building manager is essential as those who aren’t sufficient in this role can see costs spiralling. The main reason is a lack of communication between the project owner or designer and the person or company managing the build. 

A construction project manager needs team management skills to create effective collaboration among team members and coordinate contractors. Putting a project manager in place without this core skill increases the likelihood of failure.

A good project manager must be able to:

  • Manage multiple projects
  • Lead
  • Negotiate
  • Solve problems and delegate
  • Communicate and present ideas or instructions.

 

Hygiene and welfare installation

On site, it is a minimum requirement to provide basic hygiene and welfare facilities for contractors working there. It would be unreasonable to expect people working there to be unable to go to the toilet or have access to water to clean their hands, particularly for those dusty and dirty roles.

When planning a construction site project managers must consider the types of jobs required on-site. If some contractors will be near hazardous or muddy materials, showering facilities are required to allow them to wash off. How far away and how many people will be using the washing and welfare facilities is another consideration that can sometimes be lost.

Typical hygiene and welfare facility must-haves on a site include:

  • Toilets
  • Washing facilities
  • Drinking water
  • Changing rooms and lockers
  • Rest facilities and heating for them

 

These necessities may vary due to the length of the construction project but as a rule of thumb, it’s important to budget for the installation and removal of these facilities on a building project.

 

Security and property protection

Vacant properties need protection against vandals or squatters, this is also true of building projects – particularly those close to completion. Security becomes another hidden cost and headache whenever there are significant delays to a building project.

From bad or extreme weather to delays and budgeting problems, there are many reasons for construction delays. Building project managers must assess and review the state of the construction site they are responsible for.

If a site is due to be left vacant for an extended period, defences must be shored up to prevent entry from unauthorised people. This means getting a handle on the points of entry to the site by securing them with security doors and screens or fencing off the site entirely. If your site is in a populated area, security cameras or even patrols may be necessary to prevent others from moving in.

 

Lost time through delays

Perhaps the most frustrating hidden cost of managing a building project is all of the lost time. The more a project keeps chugging along, the sooner it will be completed and the less expensive it becomes.

But accidents happen, which result in lost time through workers being unavailable as they recover from injury while the site’s safety procedures need to be brought up to speed. Sometimes it’s the tools themselves that break, shutting down construction for days or weeks depending on the availability of alternatives.

There are also hidden costs to factor in when the project owner changes their mind or wants to alter the design. Time has already been spent drafting the original plans but more hours and funds will need to be allocated to deal with the amendments.

Of course, this is perfectly okay for someone to change their mind but it must be stressed to them that it comes at an additional cost. There may also be errors in the designs that aren’t highlighted until the project is underway, requiring those involved to go back to the drawing board.

 

How to deal with construction time delays

Consider adding a time buffer to the end of your project to help account for some of the potential delays along the process. The longer the project, the more likely delays are going to play a part. Giving yourself a buffer and budgeting accordingly can help keep a project from grinding to a halt when it’s so close to completion.

 

Preparing the land and excavation

It’s easy to overlook the earth and groundwork that are needed to complete a building project. Creating a budget for building materials, contractors and services can be easy but it’s not uncommon for land preparation and excavation to be forgotten.

These are essential works that many building projects rely on, especially as they lay the groundwork and allow for the foundations to be in place. Some construction management companies may not be fully transparent about their costing, so ensure that you get an itinerary of what you are agreeing to before signing a contract.

This ensures that you can account for groundwork ahead of time, rather than scrambling for funds as it wasn’t part of the original agreement with the construction management company.

 

Avoiding invisible building costs

It’s not always easy to foresee where hidden costs may spring up on a building project. All any project manager can do is try to build in enough time to compensate for delays and to be as responsible with the budget as possible. No one has a crystal ball when it comes to unexpected delays but factoring in these hidden costs can help your building project to stay within budget.