Companies that are growing quickly often invest in expanding their warehouse to keep up with increasing demand. However, stakeholders must understand warehouse construction costs to find a return on that investment. Knowing each detail down to the dollar will go a long way toward mitigating the risk of going over budget.
Start With Price Per Square Foot
One of the easiest ways to understand the cost of your warehouse construction project is to calculate the price per square foot. It’s a standard formula for commercial projects and can also be applied to job-costing warehouses. Look at similar projects in the area to get a ballpark figure; remember that this is more of an estimate or baseline than anything else and shouldn’t be considered a final cost.
As the warehouse project develops, there will be upfront costs during the planning and pre-construction phases.
Insurance: Warehouses not only hold inventory but also require your other best assets – employees – to run smoothly. The right insurance won’t be cheap but will protect your property and company.
Permits: These are a requirement for your warehouse to function, and the cost varies depending on the location, industry, and size of the building. The bigger and more complex the structure, the higher the permit fees.
Utilities: HVAC and electric costs can be astronomical for warehouses depending on the size and scope of the finished building. For companies that are working to build sustainable practices, this cost could be a significant factor in the overall warehouse design plan.
Labor: The more square feet the warehouse has, the more labor it will take to keep things running smoothly. Economic factors can also cause this number to inflate as businesses adjust wage offerings to compete in tight markets with significant labor gaps.
Keeping Construction Costs Down
Working with an experienced team of commercial construction professionals will ensure that you’re getting a return on your investment without cost overruns. Any contractor that gives you an instant quote based solely on size and location is probably a contractor you should stay far away from.
Instead, your contracting team should perform in-person cost estimations considering those many factors. They’ll know the current numbers regarding labor costs, materials, and equipment rental fees, among other costs, and give you a more accurate picture of the final price tag. Cookie-cutter estimates or online calculator tools can’t account for those nuances.
Ultimately, warehouses and the capacity and efficiency they offer become a valuable asset to the company that owns them. Customers are increasingly looking for their products quickly and efficiently, and the quality of warehouses can make or break that expectation.
Efficiency, of course, starts with the overall design of the warehouse. Taking advantage of your commercial contractor’s design-build skills can give you a more comprehensive view of the entire project, from the architectural design to the construction. This will put accountability on one point of contact who can streamline communication and get the project done according to schedule.
Work With Us
Warehouses are not all created equal, and that’s important to remember when estimating construction costs. Warehouse construction projects need to be completed quickly, and the construction contractor you work with needs to be thinking steps ahead.
At G. S. & S. Construction, your project coordinator will work with you from the beginning of the construction process until the end. We’re focused on timeliness and collaboration, but we also know that price is key to success. Get in touch to turn your warehouse construction vision into reality.