The issue of projected construction cost

By Umberto Guarracino

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    • #4274
      Umberto GuarracinoUmberto Guarracino
      Participant

      I would like to get some input from fellow colleagues.  I feel that I may have lost a couple of opportunites to engage potential Clients of residential projects, due to the fact that I have been away from the residential practice for a long time, and am not aware of current construction cost.

      I may be paranoid, but I feel that potential Clients may want to trick architects either by giving them very high budgets, or very low budgets to test their knowledge and reaction.  Last December 2016, I had a one-on-one meeting with a woman I had met a few weeks earlier at a networking meeting – during our chat over coffee she expressed that she and her husband were thinking of building a brand-new home and were looking to find a site, and then out of the blue she came out asking “Do you think we can build a 2,000 sq.ft. house for $600,000.00?” – she had previously expressed they didn’t want to do anything too complex or “fancy” (her own words) – Now I know that is not an exorbitant cost for new construction in Massachusetts, but it is somewhat generous especially if someone wants to do something very basic, and I replied “I am sure you can”  – in the following months I have followed up with emails, but never heard from her again…and now after a few months I am wondering, if she on purpose shot out a high budget, in her view, expecting to hear from me something like “You certainly can for that money, but we can certainly look at other options to see if you can do something better and less expensive than $600,000.00” – I have been wondering all along if she thought that I would base my design fees (which I don’t, but I didn’t tell her, as I thought this kind of discussion would be premature) as a percentage of construction cost and therefore, instead of being honest with her, I would accept a higher budget to drive higher fees…..am I paranoid? Did I give her the right answer?…or as I have been thinking I messed up a potential opportunity?

      The second instance is only from only a few days ago, on Saturday, March 11, I met a young couple who were referred to me by another acquaintance met at a networking group.  They have a 1,600 sq.ft. ranch with a finished basement.  They would like to add an entire second floor and wondering what they can do to preserve some if not all of the cathedral ceiling of their living room which extends for almost half of the house.  As we started to talk and I introduced to them the concept of the LLC and the fact that, if engaged for the final design, my fees are not based on a percentage of the construction cost, I eased them into sharing with me their idea of a budget for their project, which they expressed to be between $150,000 and 200,000.  During the course of the meeting I acknowledeged their budget limits, we wrapped up and I offered to send them the letter of agreement for the LCC (I had got the idea they liked the idea of starting with a LCC) – she replied they would get back to me on Monday.  Well on Monday, instead of getting an email asking me to proceed with the draft of the LCC agreement, as I was sure I would get, I got an email telling me that she and her husband had realized they needed to figure out more things and more specifics about the scope of the project before proceeding.  There was a polite exchange of two or three emails, with me offering to help along the way as they were evaluating their project, since one of my primary goals is “to educate my potential clients” as I expressed to them.  Now I am wondering if they on purpose had established a very low budget to test my knowledge: $150.000 and $200,000 for a 2nd floor 1,600 sq. ft. addition may not be adequate, especially considering that there may be substantial structural modifications (I have been thinking about this today).  So they may have thought “How can you educate us, if we know already that to build our project our budget is not sufficient, and you didn’t say a thing? – Come to think of it, a project like theirs, may require more of a $250,000 to $300,000 budget.  Once again am I being paranoid? Did I give them the right answer?…or as I have been thinking I messed up a potential opportunity?

      Thanks,

      Umberto

    • #4275

      Umberto, stop worrying about what people might be thinking about you and just do what you feel is best.

      These kinds of thoughts, second-guessing your responses, only serve to undermine your confidence.

      Based on what you wrote, it is unlikely that clients are “testing” your knowledge.

      You’ve forgotten more about architecture than they will ever know.

      What is more likely, is that they didn’t move ahead because they don’t understand exactly what you are giving them, or how valuable it is.

      Keep on moving forward and after every setback (and success) ask yourself: What can I learn from this?

      So what can you learn from this? – Enoch

    • #4276
      Umberto GuarracinoUmberto Guarracino
      Participant

      Thanks Enoch,

      do you think that regardless of what I think they may think, I should send a follow-up mailing to the potential clients I met on March 11, sending them a report to help them with their soul searching, another report and a couple of chocolate bars?

      Since they mentioned they need to figure out a few things and be more specific about the scope of their project I was wondering if the the report: How to prepare for your Design Project, and the idea of the design brief could be helpful to them, alongwith a report about the fact that competitive bidding may be advantageous in the end, as it implies more detailed drawings and control.

      What do you think? A good idea to send this stuff along?

      Thanks,

      Umberto

    • #5291
      AvatarDavid Businelli
      Participant

      This is so typical of residential “clients”. They seem to think that one can glean that magic construction number from thin air. You gave them correct answers – they were probably just beginning that long process of thinking, then deciding, to go down the design and construction road. You were being of service – and that is a very good thing. They might very well contact you when the time is right.

       

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