This estimate is an approximate cost obtained by using an estimated price for each unit of groos floor area. This method of estimating facilities costs is frequently used in building and residential home construction.
The main reason for the popularity of the ﬂoor area method is its simplicity.There are few rules to remember and the cost per square metre is well understood by property developers.A proposed building is measured at each ﬂoor level (between inside faces of external walls);no deductions are made for internal walls,stairs or lift zones.Previous similar building costs are used by dividing the construction cost by the internal ﬂoor area.Adjustments can be made for location and inﬂation; but speciﬁcation adjustments are much more difﬁcult to estimate.Subjective judgements are made for size,shape,number of storeys,services,ground conditions and standard of ﬁnishes.A separate assessment should be made for external works,demolitions, incoming services and drainage which can be signiﬁcantly different for similar buildings.
There are many buildings where the unit of accommodation method is impracticable;such as warehouse projects or open-plan ofﬁces.In these cases the superﬁcial floor area method is found to be reliable with an accuracy of 10% to 15%.This method also works well with certain external works contracts such as concrete paving or macadam surfacing.
Sometimes contractors are asked to quote for building work using sketch drawing sand a square metre price.It is unlikely that a contractor would risk signing a contract on this basis.First a clear scope of works would be needed together with a site survey and soil investigation report.The price must accurately reﬂect the amount and speciﬁcation of works.