# - Determining a Budget by Establishing a Value for the Project

4m 13s

In this ARE 5.0 Programming and Analysis Exam Prep course you will learn about the topics covered in the ARE 5.0 PA exam division. A complete and comprehensive curriculum, this course will touch on each of the NCARB objectives for the ARE 5.0 Programming and Analysis Exam.

Instructor Mike Newman will discuss issues related to programming, site analysis, and zoning & code requirements.

When you are done with this course, you will have a thorough understanding of the content covered in the ARE 5.0 Programming and Analysis Exam including project type analysis, the establishment of qualitative and quantitative project requirements, evaluation of project site and context, and assessment of economic issues.

Hi, my name is Russell Buchanan. I'm an architect in Dallas. Today we're going to be looking at a 5,000 square foot residence in Crested Butte, Colorado. For this project that we're looking at today, it's a residential project and an important consideration when you're looking at this type of project is establishing for the owner what a realistic budget is and what a realistic schedule is. Let's talk about the budget first. As far as an architect is concerned, we are not cost estimators. What we can do though is we can generally assign a value of a project on a per square foot basis.

So on this particular project, the zoning allows for a residence to be up to 5,000 square feet. So now we have the square footage goal and we need to establish a budget so we're going to take that 5,000 square feet and we are going to multiply it by a cost per square foot. Now what is a realistic cost per square foot for construction?

Is it \$100 a square foot? Is it \$200 a square foot? \$300, \$400, \$500? It's a number and over time we've become fairly familiar with what costs are and we can generally see a project and assign a value to it just based on our experience and our knowledge. On this particular project, we have 5,000 square foot limit on our construction and we've assigned a value of between \$300 and \$400 per square foot for the cost of construction.

Our budget is \$300 to \$400 times 5,000 square feet. That's just a very very quick and pretty realistic way of establishing a value for the owner. It gives us a goal to work towards.

When we move through the project, we will continue to verify that that budget is still in alignment with our original goal. We'll make recommendations to the owner if it's getting a little out of control or if we're looking good. But that's a process that we are familiar with and that we want to work with the owner on. We don't like trying to convince the owner to spend more money. What we prefer to do is establish a realistic budget and work within our means.

The second part of this has to do with a schedule. The architect has a lot of control over his own schedule, meaning the schedule to design and document the project. We have virtually no control over how long that project is gonna take to bid or how long it will take to build. So that is solely the responsibility of the general contractor. The general contractor, when he gets our drawings and is bidding on it, that's when he'll become extremely familiar with the materials and method of construction that will be required and he will generally establish a schedule for construction.

It's not unrealistic at all for a house to take a year to build. If this were a spec house in a small development, it might only take 90 days but this is a custom house in a rural or a remote area so it's going to take this general contractor about a year maybe more to build this project. Those are the components that we work within.

What our responsibilities are initially dealing with budgets and ultimately the general contractor takes control of the budget during construction. And clearly the contractor has control of the schedule during construction. So those are the components that we look for when we're working with both the owner and the general contractor to fulfill our obligations.

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From the course:
ARE 5.0 Programming & Analysis Exam Prep

Duration: 19h 56m

Author: Mike Newman