How Much Does It Cost To Build An Apartment Complex

How much does it take to construct a multi-family dwelling? It’s a simple question, but there are many variables that affect how much it costs to create an apartment complex. The reason for this might be found in the issue of proportion.

Apartment buildings can range in size from a small, two-story quad to a massive, multi-building complex with hundreds of units. Now that 2020 is behind us, a number of building projects that had been dragged down by stay-at-home orders and related concerns are nearing completion, and a number of additional projects are finally taking off, leading to anticipated apartment deliveries of 400,000 units by the end of 2021.

Budgeting for a Multifamily Housing Development

Apartment complex construction cost estimates benefit from careful consideration of the types of fixtures and fittings that will be installed. Is it a basic apartment building aimed at thrifty renters, or a high-end luxury complex in the heart of the city?

Though most apartment complexes won’t cost more than $100 million to construct, ultra-luxury flats can cost as much as $237 million for a single penthouse. For luxury apartment buildings, however, the bulk of the budget will go into the acquisition of land and buildings as well as marketing, promotion, and sales activities to reduce the likelihood of vacancies.

Except in exceptional cases like these, the majority of building projects for apartment complexes will only need medium- to low-quality materials, depending on the expected turnover and damage from residents. There might be a contrast between the apartment units and common areas, with residential-quality materials utilised there.

If you’re calculating the expenses of developing an apartment complex, it’s crucial that you pay close attention to the project’s general requirements to avoid underestimating your profit margin or overestimating your offer, respectively.

Cost-Efficient Ways to Build Apartment Complexes

Efficient Liftoff from a Multifamily Residence

Takeoffs for apartment buildings can be simplified to a degree because many units have common characteristics such as layout, finish, and even floor plan. If you have a count of a certain sort of apartment in the building, you may run your takeoff on a single unit and then multiply the results by the total number of flats in the complex that have that layout. Repeat this process as necessary until you’ve accounted for all of the apartment layouts, and then use the resulting data to rapidly get an estimate for each unit.

Make sure you include the cost of these supplies and the time needed to install them if your estimate includes work outside of the units. Running power to each apartment on a different floor may require a different amount of heavy cable to move the power to the floor and then distribute it to each apartment on that floor, even though all of the apartments for a floor plan may take the same amount of electrical wire of a particular gauge. If you don’t factor in the cost of this infrastructure into your projections, a potentially lucrative project might soon become a drain on your finances.

Remember that if you’re working on multiples of the same floor plan, you’ll save time and money on labour. Your crew’s efficiency will increase as they gain familiarity with the floor plan and its components, allowing them to finish subsequent units more rapidly than the initial ones. On days when you can’t get to the site, keep your workers busy by having them construct assemblies that will save time once you do get there, such as prewiring an electrical assembly to speed up installation. Maintaining productivity on the job site and making the most of your time there is made possible by this method.

Cost-Effective Materials Estimation

You may save money by purchasing in bulk and taking advantage of larger cases since apartment complexes require more of the same items, such as 100 of the same kitchen sink, 5,000 outlets, or 200 gallons of paint. Because of the higher profits they’re making from you and the more discounts they may provide, your relationships with your suppliers may improve as a result.

For larger projects, such apartment complexes, you have a few of choices for estimating your material prices. You have the option of sticking with your tried-and-true supply chain for the multi-unit housing project, or exploring the possibility of collaborating with new suppliers who may be able to offer you better overall pricing on the larger amounts you’ll require. Each method has its advantages and disadvantages, and you’ll need to weigh those against the total cost to arrive at an accurate estimate.

Your current suppliers may not be able to provide you with the same volume-based discounts that larger suppliers can, meaning you may be leaving money on the table if you stick with them. If you’ve built a strong connection with your supplier and they want to maintain your business as your firm grows into multi-unit housing, they’re more likely to go the extra mile for you if there’s ever an issue with the materials you’ve bought.

Estimating the Price of Constructing an Apartment Complex

Larger construction projects, however, frequently come down to more than just who offers the lowest proposal. The firm hiring you will want assurances that you can complete the task to their specifications and within the agreed upon time limit, especially if such performance is a condition of the contract. Even though your bid is lower than the competition, you could not get the job if you can’t show that you can accomplish the required outputs at the required quality level.

To increase the likelihood that an owner or general contractor will accept your estimate, you’ll need to demonstrate that your business can handle a job that’s larger than anything it’s worked on before.

Apartment complexes often have a mix of business and residential space, so you’ll need to demonstrate that you can successfully handle these transitions. In an apartment building, residential-style construction methods are used for individual units, whereas commercial infrastructures like elevators, commercial finishes, heavier-duty hardware, and similar features can be found in common areas.