If you are the project manager of a commercial property renovation, it is vital that you learn how to budget appropriately as soon as possible. There is less pressure when renovating your own residence as there are fewer stakeholders, meaning that you will need to take on the added expectations when budgeting for a commercial property. Use this short guide to ensure the project goes smoothly and within budget.
Gain a Top-Down Perspective
It is useful to look at the costs of the project from a distant perspective in the early stages. Getting bogged down in the details too soon can distract you from how to properly allocate funds. Instead, take a broad overview and roughly estimate the costs for each segment. There will be plenty of time later to fine-tune your approximations and create more accurate margins.
Gather Quotes from Tradespeople
Reach out to various relevant tradespeople and ask for quotes regarding the project. Let them know the nature of your renovation and what you expect so they can accurately respond with their quotes. The more you gather, the more discerning you can be about balancing quality with value. If possible, talk to other renovation project managers to find out who they recommend and why. Allow them to point you in the direction of trusted professionals who can join your project and make it a success.
Acquire Funds
Renovating any building requires money, but in many cases, renovating a commercial property costs more than a residential one. This is largely due to the fact that commercial properties tend to be bigger. To find funds for your project, search for commercial private lenders to help you out. It is much easier to allocate resources and break down your project when you actually have the money available. The sooner you can secure this, the better.
Start Detailed Planning
Once you have a top-down view of the costs and have acquired the necessary funds, it is time to break down each broad segment and allocate individual budgets. Bring in the relevant stakeholders and contractors for their input so you avoid under-budgeting. It is safer to expect to spend more rather than find yourself running out of money at a crucial point during the renovation. You will alleviate some of the pressure by also budgeting for more time. This allows the renovation enough space to finish without rushing or cutting corners.
Save When You Can and Spend When You Must
Part of budgeting well for a large project such as a commercial renovation is to know when saving or spending is most appropriate. In some cases, the value doesn’t increase alongside the cost. However, there will be instances where spending a little more is worth it for the overall success of the project.
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Unlike renovating a residential property, commercial renovations require more varied resources. Aside from the extra funding you need to complete the project, commercial renovations demand more approvals from different authorities and stakeholders. As the project or finance manager of the renovation, it is your job to spend appropriately so that the renovation is a success.
