By: Luka Dickson

Feasibility studies are a report commissioned at the beginning of a construction development project to ensure that the project is monetarily and logistically feasible. Its primary purpose is to provide stakeholders with a comprehensive understanding of the potential challenges and opportunities associated with the project to make informed decisions about whether to proceed. Developers get in contact with a construction cost consultant such as a quantity surveyor to find out if their ambitions are capable and match the reality of what is physically accomplishable. With recent economic challenges requiring builders to take on more risk and leading to a slew of bankruptcies, it is more important than ever for developers and builders to commission a feasibility study before any money starts being brought into the project. It is much better to find off at the start than halfway through the project that something is not achievable.

What can make a project infeasible?

There is a growing list of reasons why a project can become infeasible, some common reasons include budgetary issues, unrealistic deadlines & scheduling issues, council regulations and policies, legal requirements on zoning laws, and unsatisfactory ROI. More recently difficulty obtaining labour, materials and skyrocketing material costs have led to increases in project budgets, slimming in profit margins and significant project delays. Often there must be a certain ROI margin built into projects to account for potential setbacks and budget blowouts, therefore when that margin is slim or non-existent prior to the project beginning, it may not be worth taking the risk for many builders and developers.

What does a construction cost consultant include in a feasibility study?

A feasibility study typically includes an assessment of various factors that could impact the project’s success or failure, such as financial, legal, regulatory, technical, and environmental considerations. For example, it may involve evaluating the current market demand for the project, analysing the competition and market trends that could affect the project’s success, and conducting a cost analysis to determine the construction expenses. A construction cost consultant will go into meticulous detail to account for all components of the project. These components include materials, labour, selling and acquisition expenses and potential profit. It could also entail conducting legal and regulatory analysis, assessing any permits or zoning requirements needed for the project, and evaluating environmental impact and potential risks associated with the project.

It is important to note that feasibility studies do have their limitations. While they are an essential project foundation to help developers and builders establish the feasibility of their projects, a construction cost consultant is not a fortune teller. They are unable to predict the future and all unexpected market forces that may come into play during the building process.

Finding alternative solutions

In a scenario that finds any minor elements of the project infeasible, a construction cost consultant can help developers provide alternate solutions to help the continuation of the project. It is important that the alternative pathways maintain the same quality and avoid ‘corner cutting’. Remedial solutions can vary depending on the context of the issue, sometimes an extensive project overhaul may be required to be able to achieve an acceptable ROI and build in a margin of safety for profitability. Feasibility studies are a fantastic way early in the project timeline to reveal any potential holes in the budget or compromising areas for the project.

The benefits of hiring a veteran construction cost consultant

Having an experienced construction cost consultant and cost estimator on your project is essential. Given the recent materials market turbulence, hiring someone that has a strong understanding of conditions, local laws, and updated policies – can provide a practical advantage to ensuring your project is profitable.

Does your project require a construction cost consultant?

At Accent Estimating, we provide detailed and reliable budget estimating services for construction projects. Our team of building cost consultants and quantity surveyors will speed up your development process and ensure a fair deal for all parties. We ensure that your budget is optimised, and the project is feasible by providing reliable cost estimates.

If you would like to find out more about our estimating services available in Sydney, Melbourne, Perth and Brisbane, call us at 0413 953 869 or fill out the contact form on our website.