When Is $1 Million NOT $1 Million?
Updated: Dec 26, 2019
When it’s an estimate for site-built construction. Then it’s actually $1.3 million.
It’s true. With site-built construction, you’re likely to spend $300,000 more ($1.3 million) than the $1 million estimate by the time the project is completed.
Why? 85% of owners report that their construction projects exceeded budget. And studies put the average cost overrun as high as 30%! This produces a number of dynamics, none of which is good:
Reduced ROI. Owners and developers project their expected returns based on revenue and costs. When costs are higher than projections, ROI suffers. Relatedly, cost overruns are often associated with schedule delays. That means revenue shortfalls which further hurt ROI.
Sandbagging. Padding budgets and schedules in anticipation of cost overruns and delays ultimately ends up underdelivering on projects and shortchanging investors.
Risk. Construction managers whose projects routinely exceed budget or miss deadlines can suffer real harm to their reputations.
Conflict. Continually fighting over budget and schedules is not only painful, but these battles can unfortunately end in expensive litigation.
Fortunately, MODLOGIQ’s Smart Off-Site Construction delivers true Cost Certainty. So you can be absolutely confident your $1 million estimate actually ends up being $1 million in final cost.
How does MODLOGIQ do it?
Collaboration Partners. We’ve built a network of proven modular experts over our 30+ years in the industry – architects, engineers, and construction companies that know how to develop and erect permittable, buildable modular projects.
Pre-Construction Best Practices. Our industry-leading pre-construction best practices help avoid the predictable causes of change orders as well as uncover “hidden” issues that lead to budget problems.
Building Information Modeling (BIM) for Modular. Whether working with designers and architects experienced in designing for modular construction or helping those new to modular, our use of BIM codifies design, materials, schedules, staging, roles and more, assuring total financial and operational visibility for true budget lock-in.
Build Together. On MODLOGIQ’s plant floor, we assemble modules and major systems – MEP, HVAC, fire sprinklers, etc. – exactly as they’ll be installed on site. This ensures precise fit and finish and no ugly surprises at installation. This is dramatically different than assembly-line modular methods where the first time that components come together is at the site. When connections don’t fit or modules don’t match, it leads to expensive remediation and costly delays.
Off-Site Construction Advantages. Building under controlled, indoor conditions avoids spoilage of materials and costly delays due to weather, labor availability issues, or materials delivery problems.