Project Cost Analysis
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This chapter starts with a summary overview of a wide range of computer aided cost estimation software systems available, ranging in sophistication from simple spreadsheet calculation software to integrated systems involving design and price negotiation over the Internet. It then discusses Davis Langdon's study “Costing Green: A Comprehensive Cost Database and Budgeting Methodology” which concluded that for many of the sustainable projects seeking LEED® certification there was little or no impact on the general budget. It is shown that to arrive at an accurate estimate of the total project cost (TPC), all hard and soft costs must be included to reflect the building being complete and useable as intended. For clarification, a sample project cost breakdown is given that shows the main elements to be considered when preparing a budget estimate for a project. Moreover, the necessary steps required to be taken to develop a budget for a project are outlined, in addition to sample budgets to clarify these steps. The concepts of project buyout and bid shopping are presented and explained as well as general and supplemental conditions. Contingency types and allowances are also clearly defined, as are cost management procedures and objectives and cost planning.