Cost per Square Foot of Commercial Construction by Region

by Dean Dalvit on August 6, 2009

We get this question all the time: How much does it cost to build a commercial building? There is no quick answer and without more information about the project and its location, is essentially akin to asking how many angels can dance on the head of a pin. However, there is some guidance provided we know where you are located and what kind of building you are looking to build. Local economy is a very important factor in construction cost as well as the type of construction you intend to build.

We subscribe to RSMeans’, researchers of construction cost data nationwide, and have come across some important current data on the cost of commercial construction for four different commercial project types as a function of their location. Note, that not all types of construction cost the same per square foot, and even more importantly, the cost of construction per square foot varies significantly with location.

Below are four different types of commercial construction and the varying cost per square foot to expect for each in different regions.  All graph images are courtesy of RSMeans Construction Cost Data. Data source: Reed Construction Data – RSMeans/Charts: Reed Construction Data – CanaData

One Story Office Building

As you can see from the range of cost per square foot, location alone can represent as much as 70% of the cost driver for a single story office building. The median for this type of construction is between $160 and $170 per square foot. Not surprisingly, New York tops the charts for most expensive city to build in for all of these building types.

Convenience Store

Convenience stores are generally less expensive to construct than the other building types because of their simpler nature.  The median cost for this commercial building type hovers around $100 per square foot.Fast Food

Because of the new trends in fast food being more boutique and less assembly line, the cost for a typical fast food restaurant is on the rise. Expenses for kitchen equipment also drive this building type to a median of near $200 per square foot, the most expensive of the four building types in this discussion.

Day Care

It is increasingly important to understand the cost drivers for any commercial project and how building type, construction type and location can all be huge variables that will drive your cost per square foot. These are always a part of the initial programming discussions and the Architect will play a huge role in helping to define the ranges of cost to expect for the project.

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{ 190 comments… read them below or add one }

Dean Dalvit August 25, 2015 at 1:46 pm

From Jim: Thanks. We are in Cincinnati, Ohio. Our tastes are upper mid class without any flimflam attached. We would like a dining room with seating for approximately and a grill room with bar and seating for 30. I hope this helps.

Reply: Jim, With a full kitchen and dining area, with a level of finish that you described in Cincinnati, You should budget between $140 and $190 per square foot for your project. So at 4500 sq.ft., that would be a median conceptual budget cost of approximately $750k, with as much as $100k on either side of that, depending on a great number of details. This cost would be separate from land costs, finance costs, FF&E costs or any site improvement costs (parking lots, landscaping, etc.). I hope that helps – we would be happy to discuss your project with you in more detail – As I mentioned, our Director of Architecture, Bill Foster, is an expert in golf resort facilities and we would love to work with you on the Architecture and Engineering for your project. Please let us know if you are interested in discussing that further, what your next steps look like, and how we can help. Thanks!

Dean Dalvit August 25, 2015 at 1:01 pm

Hello Jim,
Thank you for reaching out with your comment. Before we can offer much input on your construction cost, we would need to know where you are located as project location has a significant influence on construction costs. I will reach out directly to you via email so we can continue the discussion along with our Director of Architecture, Bill Foster. Bill is an expert in golf resorts, facilities and clubhouse design, and we would love to speak with you in more detail about this project. Thanks!

Jim August 25, 2015 at 8:28 am

Looking to build a golf clubhouse with finished basement locker roooms. Approximate total square footage will be 4500. Attached covered deck approximately 20×50.
Kitchen will be included.

Dean Dalvit August 17, 2015 at 5:28 pm

Jin,
I’m happy to help – but I will need to know where your project is located first. Construction costs can be very sensitive to geographic location. Please post the location of your project, and any other details that may be relevant, and we will do our best to help provide you the information you need. Thanks!

jin August 17, 2015 at 1:20 pm

Hi my name is Jin.
I want to find out around how much cost for Martial Art studio.
Approximately 6000sqf building.
Please give me some information .

Dean Dalvit July 6, 2015 at 8:08 am

Ken,
Thanks for your question. We have a considerable amount of expertise in this project type in several markets, including Southeast Texas. The trick to answering your question is determining how much, if any, of the existing space is re-useable for the bakery. For example, if it was previously a deli or coffee shop or some other similar use, there will be substantial advantages in terms of utilities and systems, existing bathrooms, etc.. If it was previously an office or retail space, will any of the finishes be retained (flooring, ceiling grid, etc.). And if it is a core-and shell space, how much finish was provided in terms of heating, cooling, electrical, slab, bathrooms, etc.. Typically, initial conceptual budgets for what we would call a “cold dark shell” (raw unfinished, unheated space), would be between $40 and $60 per square foot for finishes – towards the higher end of that for up-scale as you’ve described. These numbers do not include FF&E, which is typically substantial in these types of operations. This would be the ovens, refrigeration and any other kitchen equipment or dining area furnishings you are planning on. A quick kitchen design and restaurant layout would enable a kitchen equipment supplier to provide you with very accurate costs to anticipate.

We have an office in Texas and would be happy to work with you on the space planning, design and engineering necessary for the project. Please let me know and I can arrange for Don Eckols, our Regional Director to reach out separately and you can take the next steps. Thanks Ken and we look forward to hearing back from you!

Ken July 4, 2015 at 9:35 am

Hello Dean,

I am working with a client in Houston that would like to do a up-scale bakery project approx. 6,000 sf to be finished out in an existing lease space in Houston. My client is asking me for the cost of the Architect/Engineering services along with the cost for construction. I’m from Brazil and I’m not sure about the cost from this Region, so can you help me out with this.

Dean Dalvit June 22, 2015 at 4:50 pm

Nessreen,
Thank you for your inquiry. Our regional director in our Texas office, Don Eckols, can follow up with you directly on your questions. We have a great deal of experience with projects like this in Texas and would be happy to help you with your project. Don will reach out to you directly, within the next few days. Thanks!

Nessreen June 22, 2015 at 3:38 pm

Thanks for the useful article. i have a fastfood restaurant project in texas , the client estimated $80k re-design, remodeling of location, and furniture
$100k for the equipment
$20k for the kitchen remodelling
$50k for the signage and screens.
i am not from texas so i don’t really know about the prices :D i looked in different sites on the internet but it was useless.
i have some questions concerning the building .
In Texas ,how much does it cost and which is more sustainable and reduces the cost : building using wood or concrete or steel ? and which of those is suitable for the $80k estimated by the client ?

Dean Dalvit June 10, 2015 at 6:22 am

It’s my pleasure Ray. Best of luck stepping forward and we look forward to hearing from you once you’re ready to discuss Architecture and Engineering design.

Ray June 9, 2015 at 9:14 pm

Thanks Dean:

I am now able to complete my initial financial stage of study. Your information was extremely helpful in that I was able to eliminate possible overlaps. I will be able to take another step. My thanks. I will be touch as the project progresses.

Ray

Dean Dalvit June 9, 2015 at 5:15 pm

Good questions Ray! This data is based on an “average” level of finish, which would include tenant finishes, but not tenant FF&E, as those are by the tenant. RSMeans takes data from all sorts of sources, and they build up the construction cost from labor and materials indexed unit costs with a regional multiplier for local costs. So, this is not an exact science by any stretch and the result is that it simply creates a data point (one of many) to establish a starting budget. Other data points would be to study recently constructed buildings of similar type in the area, contractor’s opinions of probable costs and anything else that would help to validate a starting budget. Then of course, that budget would define the program (size of building, number of floors, overall concept for construction type and level of finish) that we would then design to. Then, the iterative process of design and validation at each step so that the end result of the design does not result in any surprises.

We would love to work with you Ray, so just let me know when you are ready to take the next steps and we can discuss further. Thanks!

Ray June 9, 2015 at 4:37 pm

Hi Dean:

Thank you for the information. It is extremely helpful. I reviewed your Article but I wasn’t certain as to what it covered. I referred to the RS Means site and still needed some clarity. RS Means has direct plus overhead/supervision and architectural/engineering totaling $160, so with regional adjustment around $200. Are tenant improvements and parking included in the $200 number?

i am at a very early stage and trying to measure preliminary feasibility. Environmental theme is critical to create a difference that will show in rents and operating costs. Anyhow, as the project moves forward, I will contact you regarding consultants. Thank you.

Ray .

Dean Dalvit June 9, 2015 at 9:49 am

Ray,

Thank you for your inquiry. I’ve actually written an article on multi-story office building construction costs that is more relevant to your project. It is here: http://evstudio.com/construction-cost-per-square-foot-for-office-buildings/

From that chart, you will see that LA is nearing $200 per square foot for up to four stories of office. That boils down to a $40M project in round approximate numbers. Level of finish, both for the interior and the exterior, as well as technology and systems can play a large role in that. The assumption here is a Class A Office Building – especially with a LEED Silver designation.

EVstudio has a team of Office Building Experts who have designed a number of buildings across the country, many of which are LEED certified. We do have a Los Angeles affiliate if you would like to discuss Architectural Design and Engineering for your project in more depth. We would love to assist you on your project and help you take the next steps. Please let us know if you are interested in that and we can contact you privately to set up a free initial consultation. Thanks!

Ray June 6, 2015 at 2:02 pm

Trying to estimate the direct construction cost of a 200,000 square foot, 4 story commercial building in Los Angeles. Target is LEED Silver Certification. Thank you.

Dean Dalvit May 30, 2015 at 4:27 am

Liam,
I’m not sure what you are asking. Are you talking about all new electrical in an existing building renovation? Rough-In only or Finished? Any idea about use/occupancy? This data isn’t fine grained enough to extrapolate to any specific discipline, however, RSmeans does provide discipline specific information. I suggest you check out RSMeans.com if you’re bidding individual trades. Best of luck!

Liam May 29, 2015 at 7:04 pm

How much does it cost to install electric per sq ft in a existing commercial building?

Kelly May 6, 2015 at 5:14 pm

Thanks Dean! I figured that amount from researching your site – we are looking at a few properties and talking with the city and trying to get a business plan going…we would definitely like your help and I will get you more specific info as soon as we settle on a property. Many thanks, and I would love to see what your Designer did in Colorado!

Dean Dalvit May 5, 2015 at 5:52 pm

Kelly,
Thanks for your inquiry. Without much more information than that, I would advise you to start with a budget of at least $200 per square foot for the kind of atmosphere you would typically see in a distillery. This would not include the equipment for the distillation or bottling process, or any of the other Furnishings, Fixtures or Equipment (FF&E). To get a better handle on the construction costs, closer cost estimates could occur after a full programming of the project, and a line item qualified budget after a Schematic Design. Our Interior Designer has recently completed a distillery in Colorado that is incredibly successful. If you would like to discuss how we can assist you in the design, let us know and we would love to help. Thanks!

Kelly May 5, 2015 at 5:39 pm

Hi Dean,
Great site! I am trying to price out the build for a distillery and tasting room in southern Oregon – I’ll need a small pro kitchen and distillery around 5,000 sq ft. Would also like to consider solar/wind at the start. I have no idea where to start researching this..any advice would be appreciated!

Dean Dalvit April 2, 2015 at 10:22 am

Aretha,
That’s great that the zoning grants you that use by right – that’s a big battle you don’t need to deal with. So, the building will still need to undergo a change of use, assuming the upper two floors were not previously apartments. This would require the existing building to undergo any necessary changes to comply with the current building code for all of the proposed space. This includes Accessibility guidelines, egress, stairs and circulation, fire ratings between uses, etc.. In many cases, it can require some significant changes to the building while in others, the building may have already been designed for these requirements. It just depends on what you have to start with. The areas you describe are relatively small, so the requirements may be easier to meet. Do you have existing plans of the building? An existing building assessment would be the first place to start in determining what you would need to do to take the next steps. Just let us know if you would like us to help you with that. Thanks!

aretha April 2, 2015 at 7:06 am

Thank you for your quick response. The building is existing and is already zoned for mixed use which is what we wanted. The bottom floor will be used for office space while the additional 2 floors will be converted to apartments. Floors 2 and 3 are about 1100 sq ft while the 1st floor is about 900 usable sq ft.

Dean Dalvit April 2, 2015 at 6:40 am

Aretha,
Thanks for your question. If this is an existing building that you are looking at, then none of these numbers in this chart are going to be appropriate for your project as they are new construction numbers.

It sounds as if you are looking at doing a mixed-use project. The very first thing that you would need to do is confirm with the local planning and zoning department that your proposed uses are allowed. If they are not, then you would have to go through a rezoning process and the renovation would also require a change of use for the building. Chances are good that the building did not originally have both uses anyway, so you will likely have to go through a change of use in any event. This means taking every aspect of the existing building and bringing it up to code for the proposed uses – there is no “grandfather clause” in the IBC for buildings in a change of use. Only once we understand the impact of all of those parameters can we realistically start to outline preliminary budget expectations.

So, as you might imagine, these projects can get complicated very quickly. However, they are doable and we have done a number of change of use projects in the past. We would be happy to help you through this process if you would like. Just let us know and we can contact you separately and initiate a simple letter of engagement to help you with this project. Thanks!

Aretha April 1, 2015 at 6:17 pm

Hello Dean,
I am seeking to purchase a mixed use space in Atlanta. The property is a shell and my business partner and I would like to keep the bottom floor for commercial use but would like to develop apartments on the second and third floors. What are the steps we need to take to make this happen? I know after the purchase there is a need to design the space and attain permits for the reno. Do you know what the price per square foot is in Atlanta. I read above where you stated the prices are about the same as they were in the information you provided from 2009 but you also stated you were going to do a bit more research to see if those prices changed at all. Please advise.

Dean Dalvit March 4, 2015 at 6:12 pm

JJF,
Thanks for your inquiry. For what you’ve described, in your area, I would plan for an initial budget of somewhere between $90 and $120 per square foot, depending of course on your level of amenity and finish (mainly for the lobby and office space, assuming the actual pet day care area is largely warehouse finishes). Then, once you have a workable plan, that can be tightened up. EVstudio designs projects all over the country, so just let us know if you need any help taking the next steps. Thanks and best of luck with your project!

JJF March 3, 2015 at 9:07 am

Hello Dean,
Great site, very informative. I’m considering a pet daycare project which would require approx 5,000 sq/ft, say 50 x 100
I’m thinking a steel warehouse/industrial type building with about 1000 sq/ft of lobby and office space. Any idea what my construction costs would be? im in CT so insulation and a roof that handle the the snow load would be required. thanks, JJF

Dean Dalvit February 27, 2015 at 7:15 am

Peter,
We have designed breweries in other markets like Denver, and based on the index pricing, I would start with a ballpark expectation of $80-$100 per square foot for your location on Cape Cod. This would be for a minimal level of finish and of course would not include any FF&E costs. Let us know if you are in need of any assistance in the design or engineering of your project and we would be happy to help. Thanks!

Peter February 25, 2015 at 10:47 am

Dean,

I am trying to price out what it would cost to do a 100×50 building with 20 foot celling on Cape Cod. The space would be used for a brewery – so basically we just need a big wide open space for the equipment and the basic plumbing, electrical hook-ups for the brew system. The interior would be finished with just the basics to pass code and with surfaces that can easily be cleaned. We were hoping to do a shingled facade to give it a nicer exterior.

Not sure if you can help with this this!

Thanks,
Pete

Dean Dalvit February 7, 2015 at 4:44 pm

Marc,
That’s a tricky one because of the change in use. Assuming that mixed use with residential is allowed by the local zoning code, the new use could require a great number of changes to the existing building from fire rated assemblies to accessibility requirements and possibly even type of building construction. We have done quite a bit of adaptive re-use for older buildings as well as changes of occupancy. They can be complicated, but they are doable if the conditions allow. The first step would be a thorough assessment of the existing building along with a zoning study. Once all of the factors involved are fully understood, then you can put construction numbers to the project based on what would be required. This is a service that we provide, so if you would like to pursue those steps, let us know and we would he happy to help.

Marc February 7, 2015 at 1:16 pm

Not sure if anyone can answer this question but I have a friend that owns a office building two stories in downtown Detroit he only uses the bottom half of it and the upper half which is all empty no walls approximately 4000 sf he wants to put apartments up there maybe four or five do you know the approximate cost from framing walls to finish thanks for the help in advance

Dean Dalvit February 6, 2015 at 2:17 pm

Glen,
Thanks for your question. For a core and shell building in the Chicago area, I would budget approximately $80-$95/sq.ft., so you would be looking at the mid $3M ballpark. I’m assuming the shell does have basic MEP systems and does not require any unusually large spans for the structural grid. Also, I’m assuming an empty building, so your racking systems, or anything else in the building would be a separate FFE cost. We’ve done quite a bit of warehouse and storage work and would be happy to help with your project if you are in need of a design team – Just let us know. I hope that helps – good luck!

Dean Dalvit February 6, 2015 at 1:52 pm

Ed,
Thanks for your comment. You are correct – the data set in this post is from 2009, and based on the previous years’ numbers. Interestingly though, we are finding that the construction cost data from that timeframe is surprisingly consistent with today’s numbers. The reason being is that the shakeup in the construction industry due to the recession caused both falling, then rising trends. Across the board, in many industries, by 2013, we caught back up to about the same point as we were before the crash and have stabilized since then. I intend to research last year’s data in more detail in order to update the post, but in the meantime, the numbers are still holding reasonably valid.

So, with that said, the 5,000 sq.ft. building, assuming it is an office use (different uses have widely different construction costs), would be just around $900k for the building in your location. I’m unclear what you mean by the 2,000 sq.ft. of parking – is this just surface parking or is there a structure there? For surface parking, the site improvements will depend on a variety of factors from required curb and gutter, drainage facilities, landscaping and surfacing. For the purposes of a raw ballpark, assuming the grading and excavation is already complete, you might start with about $15/sq.ft., or around $30k for your parking lot. That would, of course, need to be validated against a real plan that meets all of the city’s regulations. At that point, a line item budget would be more appropriate.

EVstudio does have a California affiliate and we would be happy to discuss your project with you if you are in need of a licensed architectural design team to get you the necessary construction documents for permitting and construction. After programming, we would also be able to tighten the entire budget up as well. Just let us know and we are happy to help.

glenn February 6, 2015 at 1:43 pm

Hi Dean, great site I am trying to help out an old timer to figure out what an enclosed dry rack storage building shell 100×400 would run 50 miles outside of Chicago I’m on the other side of the country and have no idea

ed markley February 6, 2015 at 11:50 am

Dean,

It appears that your article was written in 2009 and that is what your construction numbers are based on. Am I correct
In thinking that? If yes, what would be the current cost of construction on a per sq. ft. Bases for the above described buildings in the Los Angeles area ?

I would like to build a new single story 5,000 sq ft commercial building on Ventura Blvd in Sherman Oaks, CA. That 5,000 feet does not include the 2,000 sq ft parking lot directly behind the building. What would be the approximate additional cost of that 2000 foot parking area ?

Thanks much for your all your help

Ed

Dean Dalvit January 7, 2015 at 8:10 am

Thanks JR for your question,

While the RSMeans data doesn’t conveniently package remodel data (likely because of so many unknowns), there are some rules of thumb. The big questions are what is the desired outcome of the remodeled space and what is the condition of the existing space? Are HVAC and electrical systems in good shape or do they need replacement? How is the exterior skin of the building, windows and doors? Is the core building structure and floors in good shape? Assuming you’re working with a good core and shell building and simply doing TI for the space, and it’s simply a renovation of a supermarket (no change of use or occupancy), then you’re really only looking at finish costs, which, for a large open space like that, assuming you’re not going boutique, may only be $15-$25 per square foot.

Often times, these older buildings are being re-purposed for a new use. For example, we recently renovated a supermarket to become office space. In that scenario, the costs go up due to level and quantity of finishes and the need for interior walls and MEP systems. In that case, the cost was closer to $40-$60 per square foot. And if the building itself has structural or MEP issues, you could easily wind up approaching a new construction cost per square foot of $100 or more.

I hope that helps. EVstudio has a depth of expertise in renovations of larger commercial space and retail tenant finish. We would be happy to discuss your project with you in more detail. Just let me know and I can reach out to you separately by email. Thanks!

JR January 7, 2015 at 3:22 am

Hello Dean,
Any thoughts on a cost per square foot to REMODEL an existing 10,000 sq ft supermarket in northern NJ? I am at the initial stages and am looking for a general range.
Thanks

tailer November 3, 2014 at 1:21 pm

Yes near Los Angeles thank you Brian. And thank you Dean you have been a big help!! My project is on it’s way!

Dean Dalvit November 3, 2014 at 12:39 pm

Ah – thanks Brian, I can see that is definitely a possibility. Two possible Ontario, CA locations. In that case, I’d use the numbers for LA and budget a minimum of $152/Sq.Ft.. Hope that helps!

Brian November 3, 2014 at 11:40 am

Dean, I believe Tailer may be referring to Ontario, California, near Los Angeles.

Dean Dalvit November 3, 2014 at 8:38 am

Thanks Tailer,
While we don’t have RSMeans data for Canada, it is reasonable to infer from nearby US cities that an initial budget projection could be between $150 and $170 per square foot. That would apply to your 11,000 Sq.Ft. of finished space but would not include Land costs, Finance or Soft costs, or furnishings fixtures and equipment for operations. I hope that helps – best of luck with your project!

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