There are many expenses associated with commercial construction. But how much does it cost to rebrand and renovate a commercial building?
For starters, commercial construction and buildings can be separated as lodging, retail, office, industrial and amusement. There are of course costs of ownership and costs to rent commercial buildings. When it’s time to renovate commercial space, that can be driven by the building owner hoping to attract or retain tenants – it is important to keep up with the times, as well as prevent buildings from falling apart.
When it comes to rebranding commercial space, that is typically driven by the tenant. It is the tenants’ brand which covers the commercial building – their signage, colors and overall image. The tenants, especially in retail, want to keep a modern image and attract customers that way. This requires rebranding from time to time – changing out the overall look, feel, textures and signage of a commercial space. Commercial building general renovation can be desired for rebranding purposes or just need of upkeep. For these reasons renovation can be driven either by the owner or tenant. However even when renovation is for the tenant (such as for rebranding), costs may be shared with the commercial building owner. Especially when a tenant is looking to move into a space, buildout renovation costs are negotiated with (and some are covered by) the owner.
Commercial construction costs are usually measured in cost per square foot. Materials, location, type of building and local economy all add up and contribute. It becomes necessary to plan in advance for all projected costs – and to do so with the necessary parties. For example the construction manager is in a position to keep track of costs throughout a commercial building rebrand and renovation project.
The building location is very important to the project and can consume the majority of project cost. For example construction projects in New York or San Francisco can cost more per square foot than rural areas or other cities. But it’s not just the population that controls location costs – weather treatment needs impact cost as well. Areas which are more tornado- or earthquake-prone require additional construction materials and techniques – as do heavy snow areas. Local building codes also change per area – and building permits are required, yet different, for specific locations – and these can impact construction costs.
Another cost to look at in commercial construction is insurance. For example, steel or concrete are used more these days in comparison to wood construction because of lower insurance costs. Architecture can also change insurance costs – for example with roofing design styles. Architectural style and construction repeatability also factor into cost breakdowns. Convenience stores are simple buildings and can cost less than other structures. Fast food restaurants used to be similar, however these days fast food restaurant buildouts are meant to give a grander, more multi-sensory brand experience for customers than in previous years – which in turn requires more construction activities and equates to higher costs.
Other factors which impact costs in commercial construction are sustainability and modular elements. Modular building elements are increasing in construction popularity – in part because of environmental issues. Pre-fabricated, modular building elements are easier to construct (and quicker), with less disruption of the construction environment. Of course additional sustainability environmental construction requests increased costs to implement.
Labor can of course raise costs in any industry – especially in building cost breakdowns. Labor is important in America as increasingly more Americans choose to get college degrees for office jobs instead of traditional trades. So the construction labor demand continues to grow.
These commercial construction cost breakdown factors comprising codes and regulations, location, materials, weather, architectural style, labor, modular and sustainability elements all contribute to industry and demand in rebranding and renovating commercial buildings.
Want more? Read about Buildrite’s renovation services.