Commercial buildings are utilized in various sectors such as education, health, and retail. Depending on usage and factors like location, these costs can vary greatly. The area’s zoning and geography also play significant roles, as materials tend to be more expensive in earthquake-prone regions. Controlling these costs allows owners to finish their projects within budget and enables contractors to protect their profit margins.
This article discusses the average construction costs per square foot, derived from Cumming’s US Construction Per Square Foot Data. These numbers are rough averages subject to a wide range of varying factors and fluctuations.
The median construction cost ranges from $350 per square foot for small installations, with prices in areas like New York reaching up to $450 per square foot. Location significantly influences construction costs, varying by state and affecting up to 70% of the overall costs. For example, New York is one of the most expensive cities to build in, with climate considerations like snow volumes also driving up costs. Local jurisdictions have different construction permits, further affecting the prices.
In cities like New York, Washington, Boston, Philadelphia, and Raleigh Durham, the average construction cost estimates per square foot are as follows: single-story commercial buildings cost $301 to $361 per square foot, mid-rise office buildings range from $599 to $719, and high-rise buildings are the most expensive, ranging from $688 to $827 per square foot. Other structures, such as neighborhood strip centers, shopping malls, and hotels, also vary in cost depending on the location.
In cities such as Las Vegas, Seattle, Honolulu, Portland, Sacramento, and San Diego, single-story commercial buildings cost between $313 and $378 per square foot. Mid-rise buildings range from $481 to $607, and high-rise buildings cost between $557 and $730 per square foot. Neighborhood strip centers and shopping malls have varying costs, as do three-star and five-star hotels. School construction in Honolulu is notably more expensive. Due to climate differences, building costs in the Midwest vary. For example, single-story commercial buildings cost between $237 and $298 per square foot, mid-rise buildings range from $454 to $556, and high-rise buildings are priced between $554 and $689 per square foot. Hotel facilities, neighborhood strip centers, and schools have varying costs depending on location.
In cities like Dallas, Orlando, Atlanta, and Miami, single-story commercial buildings range from $238 to $286 per square foot. Mid-rise buildings range from $474 to $569, and high-rise buildings cost between $545 and $654 per square foot. Neighborhood strip malls, shopping malls, and hotels also vary in cost depending on the location. For instance, single-story office buildings average $313 per square foot, mid-rise office buildings cost around $562, and high-rise buildings average $660 per square foot. Costs for other building types like hospitality, warehouses, healthcare facilities, schools, universities, retail, parking structures, and public facilities also vary based on usage and location.
Several factors contribute to the pricing of commercial projects. The cost of foundations accounts for 11.3% of the total construction costs, labor costs range from 20% to 40%, and materials specified by the design team account for 17.3% to 25%. Region, finishes, fixtures, design fees, major systems/utilities, permits, and land costs also significantly impact the overall budget.
Other important costs include hard costs (employee benefits, landscaping, LEED certification), soft costs (taxes, legal fees, insurance), long-term costs (maintenance, daily expenses, energy), and financing costs (loans). Construction costs vary from project to project, influenced by location, building type, and other specific factors. Understanding these variables can help in better estimating and managing the overall costs of commercial construction projects.
