If you are an owner, or part owner, of an apartment complex currently being built, it’s likely that you’ll run into unexpected costs. They can stem from multiple factors: cost overruns in either materials or labor, unexpected revamps to construction plans and even weather-related delays that hike labor costs.
It’s to your advantage, of course, to minimize these unexpected costs. But what’s the best way to do it, given that some of the triggering factors are unexpected as well? Here are four strategies.
1. Know the Code, Check the Code
All new buildings must meet the building codes in their jurisdiction, whether Federal government, state or municipality. Code covers a wide spectrum of building requirements. We cannot emphasize enough how much compliance with the code can eliminate unexpected delays. Finding out that your building needs a particular kind of hurricane-impact window and doors, after standard doors and windows have been ordered, for example, can add thousands of dollars and possibly several weeks to the construction project.
You also need to be aware of the complexity and multiplicity of code. Be sure you find out what municipality regulates the code in your area. If the complex extended over a parcel of property, make sure the code is uniform over all of it.
Code also changes frequently. If you own or invest in multiple properties, code that was standard last year will not necessarily be the same this year.
The most frequent code changes are either to safety features (those hurricane-impact doors and windows) or to energy efficiency. But all codes need to be met, including those that mandate the size of the foundations, the height of the buildings, the width of the pipes and so on.
Bottom line: building codes are complex, cover multiple aspects of a construction project and change frequently. Keep on top of the codes in your area.
2. Plan for the Unexpected
Even with the best planning in the world, construction of a housing project can still end up costing more if there is a truly unexpected event that halts construction.
Given the care and controls in place during most apartment complex construction, one of the only truly unexpected delays concerns the weather. Heavy winds, significant snow and rain can stop exterior construction dead in it tracks. Winds and snow have the potential to knock out power as well, which can stop even interior construction from going forward.
All delays in the timeline have a potential to cost more.
One solution is to have a back-up generator always on call for the project. Back-up electricity ensures that the construction crews can keep working if the power goes out for weather or any other reason.
3. Design and Plan Prudently
Another way to plan for unexpected costs is to make sure your architectural plans and designs are developed with an eye to prudent cost minimization and efficiency.
It will save costs, for example, to have plumbing facilities stacked both floor to floor and unit to unit. In other words, bathrooms and kitchens in all floors will be in the same place, so the appropriate water and other pipes are clustered in one area of the building. It’s also wise to construct them back to back, so that the bath/shower that’s on the left outer wall of Apartment A will be separated by only a wall from the bath/shower in Apartment B. They share water and other pipes, too.
Another prudent design plan is to be specific about the interior detail. More than one construction project has been held up by a sudden request for top-of-the-line lighting fixtures or tile throughout the house, when the blueprint indicated only a standard fixture or floor.
Top-of-the-line material can have a significant variation in installation complexity. The more detail you have, the less you’ll be surprised by either a cost addition or a cost overrun in labor.
4. Implement Transparent Communication
Project managers can be extraordinarily helpful in defining the scope of a building project. However, there are multiple groups on a construction site at any given time. As much as possible, the construction crews, builders, designers and skilled trades need to be consulted on the needs and requirements of specific plans.
Encourage the project’s product manager to share detailed and specific plans to gain the input of these groups. Many construction delays occur when the rubber hits the proverbial road. The skilled trades might be expected to put in porcelain, for example, quicker than they are able. If the forepeople give reasoned input, delays can be avoided.
The project managers should also prepare reports on the availability of materials and expected receipt dates. The more specificity and transparency you have in your estimates, the better off you’ll be.
Finally, obtain progress reports often. That way, delays can be optimally managed.
Unexpected costs can raise the overall expense of a new apartment complex. While upward costs frequently accompany construction projects, the four strategies here provide methods to minimize surprises.
This article was written exclusively for Rentometer by Megan Wild. Megan Wild is a real estate and home improvement blogger who writes about easy ways that you can fix up rentals or your home. When she’s not sanding her next project, she’s found walking her dog, Tucker.
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