How to build a big or small shopping center?

Making budget for shopping center can be quite complicated task as it involves various things. A small change in any one of the factors can affect the overall cost of the construction. Basically, the cost of construction of shopping mall depends on the following five factors

(1) Land Cost & other exterior features – The cost of land plays a crucial role in the construction of the shopping center. Many a times, people don't pay much attention to it but this is the main factor which can either increase or decrease the overall cost of construction to a great extent. Location is the main deciding factor in the land cost. Constructing a shopping center in the city is way more expensive than the rural areas.

(2) Design & Development Cost – Whether it will be a small project or large, it will need an architecture approval. Therefore, one will need to hire a professional architecture firm who can design the layout of the building. An architect not only handles the designing phase but manages many other functions as well such as permits, paperwork, and other requirements by the local agencies. Overall, they have to make sure that everything should be as per the regulations. Different areas have their different regulations, for example, California is having quite strict rules as compared to other areas. Therefore, an architect has to look after all these things and thus they have to do a lot of work.
Architects are the one who can tell the initial and final budget of the project after all this estimation. This step contributes to around 17 percent to the total cost of the project which is not that much as per the work involved in this task.

(3) Building Material Cost – This cost will vary as per building designs and size. Greater the size of the building, more the material will be used and thus more will be the cost. Another thing that contributes to the building cost is the material used in the finishing of the building. Generally, shopping centers have vanilla shells which include all the common services that are required. Sometimes, people find that turn-key spaces are also beneficial but they are quite expensive than vanilla shells.

(4) Labor Cost – The labor cost involved in the construction of the building may vary depending on the type of labor involved i.e. unionized or non-union labor. All the expense related to contractors and sub contractors come under the labor cost. It contributes to 38 percent to the total cost of the project.

(5) Machinery Cost – It is quite obvious that to construct a shopping center, it will involve machinery as well and that's why heavy machinery is bought on rent. This machinery contributes to around 5 percent to the total cost of construction of the building.

It is recommended to have an estimated idea of budget before starting the project so that it will be easier to manage afterwards. Lowest bid is said to be the bad representation of final cost. Therefore, it is important to understand properly all the factors for a proper cost estimation.

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