Cost reduction strategies

What do you do when your project is over budget and the contractor wants to cheapen your design to bring costs down? There can be many answers.

Invariably, the architect and the builder engage in a process to reign in costs, sometimes euphemistically described as “value engineering.” Though the goal of reducing the total construction cost can be achieved in many ways, unfortunately it is often done by downgrading materials, or by providing knock-off substitutes for more expensive (and higher quality) products.

Doing this involves plastic laminates in lieu of solid surfacing, hollow core doors vs. solid doors, or cast aluminum instead of brass hardware. In most cases, the short-term advantage of this type of budget management is at the expense of long-term client satisfaction when the lesser products fail to live up to the homeowner’s expectations. For this reason, the quality reduction approach should not be the first choice.

Fortunately, there are a number of alternative methods to creatively lower costs without sacrificing good design or quality. One of the most obvious ways is to reduce the total square footage of the project. Clients may initially contend they need a house with five bathrooms and a four-car garage, but careful observation of their lifestyle may reveal otherwise. Considering the typically high cost associated with furnishing bathrooms, a closer inspection of the original design may reveal, for example, that the owner could do without an extra private guest bathroom in order to get back in budget. Similarly the kitchen, a high cost-per-square-foot area, might be decreased in size without sacrificing the client’s program.

Another approach is to reduce the number of single purpose spaces by designing multiuse rooms. A home office that can double as a study or a library will go a long way to reducing the house’s total cost without necessarily compromising desired functions. Showing your clients how elements in a room can be hidden, screened off or stored away will help them visualize the possibilities. It is my experience that homeowners often are open to alternative solutions when provided with creative, space-saving design concepts.

Alternatively, consider if the project can utilize phased construction to allow for stand-alone components to be completed at a later date. A separate guest cottage, swimming pool, hot tub or tennis court should be included in the initial design, but built when more funds are available. In this same vein, selected interior spaces initially can be left unfinished, providing the mechanical, plumbing and electrical infrastructure is incorporated in the base work. Wine cellars, workshops, game rooms and package sauna units all lend themselves to future build-out.

When square footage reductions are not an option, design solutions that simplify the floor plan or the details should be entertained. One larger room with strategically placed furniture or changes in flooring materials to delineate differing activities might function as well (or better) than many small rooms with separate walls and cased openings. Furthermore, determine if the reflected ceiling plan for some rooms could be streamlined. Simplifying wood moulding profiles throughout the house is another way to control costs while maintaining some level of decorative ornamentation.

When deciding how best to reduce costs to get back in line with the established budget, there are many possible approaches. Cheapening finishes and building products can lead to customer dissatisfaction that adversely affects future referrals. Budget management solutions that maintain size and superficial appearances at the expense of long-term quality or good design may not be the best solution for the client, or for the architect and builder’s reputations.

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