Building Economics: Appraisal and control of building design cost and efficiency

520 Pages·1996·72.63 MB·English

by  Ivor H. Seeley BSc (Est Man)

Macmillan Building and Surveying Series
Series Editor: lvor H. Seeley
Emeritus Professor, The Nottingham Trent University
Advanced Building Measurement, second edition lvor H. Seeley
Advanced Valuation Diane Butler and David Richmond
Applied Valuation Diane Butler
Asset Valuation Michael Rayner
Building Economics, fourth edition lvor H. Seeley
Building Maintenance, second edition lvor H. Seeley
Building Maintenance Technology Lee How Son and George C. S. Yuen
Building Procurement Alan E. Turner
Building Project Appraisal Keith Hutchinson
Building Quantities Explained, fourth edition lvor H. Seeley
Building Surveys, Reports and Dilapidations lvor H. Seeley
Building Technology, fifth edition lvor H. Seeley
Civil Engineering Contract Administration and Control, second edition
lvor H. Seeley
Civil Engineering Quantities, fifth edition lvor H. Seeley
Commercial Lease Renewals Philip Freedman and Eric F. Shapiro
Computers and Quantity Surveyors Adrian Smith
Conflicts in Construction-Avoiding, Managing, Resolving Jeff Whitfield
Constructability in Building and Engineering Projects Alan Griffith and
Tony Sidwell
Construction Contract Claims Reg Thomas
Construction Law Michael F. James
Contract Planning and Contractual Procedures, third edition B. Cooke
Contract Planning Case Studies B. Cooke
Cost Estimation of Structures in Commercial Buildings Surinder Singh
Design-Build Explained David E. L. Janssens
Development Site Evaluation N. P. Taylor
Environmental Management in Construction Alan Griffith
Environmental Science in Building, third edition R. McMullan
European Construction-Procedures and Techniques B. Cooke and
G. Walker
Facilities Management-An Explanation J. Alan Park
Greener Buildings-Environmental Impact of Property Stuart Johnson
Housing Associations Helen Cope
Housing Management: Changing Practice Christine Davies (Editor)
Information and Technology Applications in Commercial Property
Rosemary Feenan and Tim Dixon (Editors)
Introduction to Building Services, second edition Christopher A. Howard
and Eric C. Curd
Introduction to Valuation, third edition David Richmond
Marketing and Property People Owen Bevan
Principles of Property Investment and Pricing, second edition
W. D. Fraser
Project Management and Control D. W. J. Day
Property Finance David Isaac
Property Valuation Techniques David Isaac and Terry Steley
Public Works Engineering lvor H. Seeley
Quality Assurance in Building Alan Griffith
Quantity Surveying Practice lvor H. Seeley
Recreation Planning and Development Neil Ravenscroft
Resource Management for Construction M. R. Canter
Small Building Works Management Alan Griffith
(continued overlean
Structural Detailing, second edition P. Newton
Sub-Contracting under the JCT Standard Forms of Building Contract
Jennie Price
Urban Land Economics and Public Policy, fifth edition P. N. Balchin,
J. L. Kieve and G. H. Bull
Urban Renewal-Theory and Practice Chris Couch
1980 JCT Standard Form of Building Contract, second edition
R. F. Fellows
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BUILDING ECONOMICS
Appraisal and control of building design cost and efficiency
IVOR H. SEELEY
BSc (Est Man), MA, PhD, FRICS,
CEng, FICE, FCIOB, FCIH
Chartered Quantity Surveyor
Emeritus Professor of The Nottingham Trent University
Fourth Edition
MACMILlAN
©I. H. Seeley 1972, 1976, 1983, 1996
All rights reserved. No reproduction, copy or transmission of this
publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or transmitted
save with written permission or in accordance with the provisions of the
Copyright Act 1956 (as amended), or under the terms of any licence ,
permitting limited copying issued by the Copyright Licensing Agency, 90
Tottenham Court Road, London W1P 9HE.
Any person who does any unauthorised act in relation to this publication
may be liable to criminal prosecution and civil claims for damages.
First edition 1972
Reprinted three times
Second edition 1976
Reprinted four times
Third edition 1983
Reprinted seven times
Fourth edition 1996
Published by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG216XS
and London
Companies and representatives
throughout the world
ISBN 978-0-333-63835-4 ISBN 978-l-349-13757-2 (eBook)
DOI 10.1007/978-1-349-13757-2
A catalogue record for this book is available from the British Library
10 9 8 7 6 5 4 3 2 1
05 04 03 02 01 00 99 98 97 96
CONTENTS
Preface to Fourth Edition ix
Acknowledgements xi
List of Figures xiii
List of Tables XV
1 The Concept of Cost Control 1
Introduction; historical development of cost control processes; European context; need for cost
control; main aims of cost control; cost, price and value; the importance of building; building output
and costs; tendering arrangements; building procurement; public procurement in the European
Community; comparison of cost planning and approximate estimating; cost control terminology;
BCIS; BMI; CEEC; other sources of European information; cost implications of dimensional
co-ordination; introduction to value management/engineering; computer aids to cost planning;
expert systems; examiners' reports.
2 Cost Implications of Design Variables and Quality Assurance 31
Plan shape; size of building; perimeter/floor area ratios; circulation space; storey heights; total
height of buildings; grouping of buildings; relative costs of flats and houses; implications of
variations in the number of storeys of buildings; column spacings; floor spans; floor loadings;
cost estimation of structures of commercial buildings; design cost criteria; constructability; quality
assurance.
3 Functional Requirements and Cost Implications of Constructional Methods 56
Low and high rise buildings; substructures; structural components; walling; roofing; flooring;
doors and windows; finishings; service installations; automation; fire protection; external works.
4 Influence of Site and Market Conditions and Economics of Prefabrication,
Industrialised and System Building 90
Effect of site conditions on building costs; use of plant; site productivity; market considerations;
cost implications of prefabrication and standardisation; industrialised/system building methods;
industrialised and system built housing; problems with industrialised/system building; economics of
industrialised/system building; the future in industrialised/system building and their main defects;
refurbishment of tower blocks; CLASP.
5 Economics of Residential Development 113
Background to public housing provision; later housing developments in the UK; use of land for
housing purposes; assessment of housing need; some financial aspects of housing provision;
dwelling types; housing requirements of occupants; patterns of development to meet varying
density requirements; economics of housing layouts; some overseas developments; car parking
provision; rehabilitation and modernisation of older dwellings; latest trends in housing.
v
vi Contents
6 Approximate Estimating 154
Purpose and form of approximate estimating techniques; unit method; cube method; superficial or
floor area method; storey-enclosure method; approximate quantities; elemental cost analyses;
comparative estimates; interpolation method.
7 Cost Planning Theories and Techniques 174
Plan of work; cost control procedure; information required by architect and building client; role of
the quantity surveyor during the design stage; cost planning techniques; building industry code;
Cl/SfB classification system; cost planning of mechanical and electrical services; cost control
during execution of contract; cost control by the contractor.
8 Cost Modelling 202
Introduction; accuracy; historical development of cost modelling; BCIS on-line approximate
estimating package; Bucknall Austin building cost model; Davis Langdon and Everest cost model;
purposes of cost modelling; approaches to cost modelling; types of model; risk analysis/Monte
Carlo simulation; statistical models and regression analysis; other cost modelling applications;
simulated modelling; network cost modelling systems; expert systems; conclusions.
9 Cost Analyses, Indices and Data 211
Cost analyses; standard form of cost analysis; cost limits; building cost/price indices; application
and use of cost analyses; cost data; cost research.
10 Practical Application of Cost Control Techniques 248
Worked examples 1, 2 and 3 covering the preparation of a preliminary estimate, first cost plan,
and cost checks and cost reconciliation during the design process; conclusions; cost control of
engineering services.
11 Value Management 277
General principles; value management definitions; reasons for the client comm1ss10ning VM
studies; alternative approaches: the charette; 40 hour management workshop/study; one-two day
workshop/study; other alternatives; VM strategy; comparison of VM and cost management; VM
techniques- functional analysis; FAST diagrams; criteria scoring/alternative analysis matrix; VM
case studies: Computer Centre, Northern England; Bank Processing Centre, Northern England;
conclusions.
12 Valuation Processes 296
The concept of value and investment; methods of valuation; valuation tables; rental value;
premiums; service charges.
13 Life Cycle Costing 308
Concept of life cycle costing; volume and impact of building maintenance work; value for money;
practical problems which affect life cycle costing; life cycle costing terminology; the technology of
maintenance; types of maintenance; current and future payments; maintenance and running costs;
occupancy costs; the lives of buildings and components; life cycle cost plans; practical life cycle
costing examples; energy conservation; prediction errors; effect of taxation and insurance; main
tenance cost records and data; greener buildings; facilities management; intelligent buildings.
14 Land Use and Value Determinants 380
Changing land use requirements; land use planning; land values; factors influencing development;
encumbrances and easements; matters determining land use and value; land and building values.
Contents vii
15 Economics of Building Development 403
Nature of property; the essence of development; development properties; budgeting for public
and private development; land acquisition procedures and problems; financial considerations;
sources of development finance; project finance; developer's budget; feasibility study; choice
between building lease or purchase.
16 Environmental Economics and the Construction Industry 434
Environmental management; concept of environmental economics; public and private investment;
structure of the construction industry; variations in workload on the construction industry;
relationship of output of construction industry to available resources; effect of government action
on the construction industry; European Union proposals for growth and competitiveness; urban
renewal and town centre redevelopment; new and expanding towns; building conservation and
urban regeneration; cost benefit analysis; private finance projects.
Appendix 1: Amount of £1 table 476
Appendix 2: Present value of £1 table 478
Appendix 3: Amount of £1 per annum table 480
Appendix 4: Annual sinking fund table 482
Appendix 5: Present value of £1 per annum or years' purchase table 484
Appendix 6: Metric conversion table 486
Appendix 7: Life cycle cost plan 488
References 493
Index 499
PREFACE TO FOURTH EDITION
The fourth edition has been comprehensively Quantity Surveyor, published in 1991, em
rewritten, updated and extended to cover the phasised the need to provide more accurate and
latest developments and techniques in this rapidly robust forecasts of construction costs and prices
expanding, changing and vital area of activity. and particularly the development of the tech
Cost management has become the most im niques of early cost advice, construction cost and
portant single facet of the work undertaken by the market forecasting and cost control, including the
quantity surveyor, with the primary objective of use of cost modelling and the application of latest
controlling construction costs and obtaining value computer technology. Seen in this context, cost
for money, set against perceived performance forecasting is a truly professional service, re
expectations. It is imperative to secure projects quiring the exercise of a high level of expert
that satisfy the client's requirements with regard discretion and judgement in conditions of con
to cost, time, function and quality. There has siderable uncertainty over client requirements,
developed a pressing need to refine the tools of design and future cost and price movements in the
cost prediction and control, and for the quantity industry and in the economy generally. It is hoped
surveyor to possess a wide knowledge of the that the revised text will assist the reader in
factors influencing construction costs and other undertaking these activities and having regard to
related development aspects; this book seeks to the desirability of incorporating future costs in
address this need. comparative analyses.
Hence the scope of the book has been enlarged Two new chapters have been added: one on
substantially to take account of the widening and 'Value Management' and an introductory chapter
more sophisticated cost management and control on cost modelling, as these areas have assumed
service required by the discerning client. It is much greater importance and the quantity sur
believed that the new edition will meet the needs veyor needs to be familiar with their main charac
of the practising surveyor and student more effec teristics, uses and applications.
tively, by providing the breadth of knowledge In addition, the text has been widened sig
needed to make informed judgements on the nificantly to incorporate many new aspects in
many diverse matters coming within the remit of cluding the European context, expert systems,
this subject. The book should be of value to quality assurance, buildability, cost implications
students on quantity surveying degree, higher of automation and fire protection, latest housing
diploma, BTEC and NVQ courses, be of con developments in the UK and overseas with their
siderable use to practising quantity surveyors as cost consequences, cost control by the contractor,
a handy means of reference, while architects, extension of cost planning of M&E services, en
building surveyors, property managers and con largement of life cycle costing, occupancy costs,
tractors may find much of interest within its facilities management, energy conservation,
pages. greener buildings, intelligent buildings, land and
The RICS Report Quantity Surveying 2000 building values, property characteristics, sources
( QS 2000) - The Future Role of the Chartered of development finance, project finance, en-
ix
X Preface to Fourth Edition
vironmental management, environmental impact rates and prices contained in the text, which are
assessment, urban regeneration, building con mainly those operative in 1992 to 1994. Hence
servation and private finance projects. these should be taken as indicative and are used
The number of case studies and supporting primarily to illustrate the principles and tech
tables and diagrams has also been increased niques involved. In practice current local rates
considerably to assist in bringing the subject to and prices should be used wherever possible.
life and to make the text more easily readable.
Unfortunately, fluctuating building and land Nottingham IVOR H SEELEY
prices and interest rates will continue to affect the Autumn 1994