Buildings for Every Budget
Welcome to Construction Physics, a newsletter about the forces shaping the construction industry.
This newsletter is, among other things, about ways to make building construction more efficient. If we want to do that, though, it’s useful to know where we’re starting from. How much does it actually cost to put up a building? How does type of building affect cost? Let’s take a look at the construction costs for a few common (and a few not so common) building types, and see what we find.
Construction costs are, unfortunately, highly variable across both time and location. They depend on things like the local labor environment, current material prices, the skill of the contractor, the frequency the owner changes their mind, etc. The values below should be assumed to be from a not-particularly expensive area of the US, but even they should be assumed to have wide confidence intervals attached. Unless noted otherwise, the costs below are given in terms of dollars per square foot .
Hoop House - $2.50 per square foot (plus labor)
Starting at the bottom, a hoop house is roughly the flimsiest thing that could still be called a building. It’s nothing more than a sheet of plastic pulled over top of bent steel fence posts, with a door on the end. Hoop houses act like greenhouses - the plastic over top serves to extend the growing season for any plants inside. The plastic sheeting construction means hoop houses will only last around 3-10 years.
Family sized camping tent - $3-4 per square foot
Next we move into fabric structures fit for human habitation. A typical tent is a factory-produced item made from polyester fabric, and supported by steel, fiberglass, or aluminum poles. Buy it from a store like LL Bean or REI and you’ll get a one-year warranty on it.
Storage Shed - $10-15 per square foot
A prefab storage shed, the sort you can buy at any home improvement store. This particular one I’ve linked is fairly nice. Waterproof, resin panels with a 10 year limited warranty, and made in the USA in their Illinois factory.
Quonset hut - $10-13 per square foot (plus labor)
Moving into slightly more permanent structures, we have the Quonset hut. These are cylindrical structures made from corrugated, galvanized steel. They were originally designed in the 40s for the military, as buildings that could be shipped anywhere in the world and quickly assembled without skilled labor. They’re perhaps the least expensive “permanent” structure you can build - many surplus units sold after WWII are still standing today.
This cost is for just the plain building. Any sort of services, finishes, or site prep will cost you extra.
Yurt - $17 per square foot (plus labor)
Scale up your family sized tent, add some heavier structural framing to support the larger space, and you have a yurt. Yurts are generally made from wood framing with a fabric cover (this one uses polyester). Yurts are often designed to be portable, but can also be built as permanent structure.
This price includes the basic yurt kit, without any sort of site prep or interior buildout.
Metal Building - $16-20 per square foot
Now we’re venturing into actually popular construction types. Metal buildings consist of custom fabricated steel frames and light gauge purlins, with walls and roof made from light steel deck. The metal building market is enormous - it’s the default construction type for warehouses, maintenance facilities, industrial spaces, low-end retail - anything that needs a few thousand square feet of space for cheap. Despite their low-cost, metal buildings are extremely durable, and are easily repurposed.
The price above will generally be enough to get you an erected, insulated metal building on a concrete slab, but without any sort of services (electricity, plumbing, etc.).
Manufactured home - $40-50 per square foot
AKA mobile homes, these are single family homes built in a factory and delivered to the site in large, pre-built sections. A manufactured home is distinguished by being built on a permanent steel chassis in accordance with the HUD code, which allows it (theoretically) to remain portable.
As we discussed previously, manufactured homes are built using wood frame construction, similar to site-built. They achieve their low costs largely by minimizing material use, using inexpensive finishes, and operating on low margins that they make up elsewhere.
Parking garage - $60-70 per square foot
A parking garage will generally be made out of precast concrete panels fabricated in a purpose-built manufacturing facility. They’re designed solely for car storage, so they have almost no bells and whistles - no HVAC, no plumbing, no interior finishes, and so on. The above price will get you a completed building, but a “completed” parking garage remains a fairly basic building.
Single family home - $100-150 per square foot
Your typical single family home, the sort we have millions and millions of in the US. These will generally be site built, made out of light-framed wood on top of a concrete slab. The above price is more or less “all in” - slab, services, etc.
Office - $200-250 per square foot
A typical low to mid-rise office building. These are typically framed with steel beams supporting a composite concrete deck, and provide wide, uninterrupted spaces to accommodate a variety of possible tenants and office layouts. The above is the all-in cost.
Hospital - $400-500 per square foot
Hospitals will be large, complex structures, generally built out of either steel or concrete. They generally have extremely specific requirements for things like air handling, vibration, earthquake design, water purity, and so on, and this is reflected in the building cost. The above is the all-in cost.
New York City Library - $900-2100 per square foot
New York libraries don’t have particularly stringent design requirements, but they do have an incredibly inefficient project management process, which causes projects to get drawn out as they jump through various levels of approval. This, layered on top of some of the highest construction costs in the nation, results in huge budgets for even simple buildings.
Labor expense is a major driver of building costs, and this is doubly true if that labor is highly paid white-collar administrators and project managers.
Antarctic Base (Brazilian designed and Chinese built) - $2200 per square foot
An Antarctic base checks almost every “expensive construction” box there is:
Highly specific design requirements - Designing a building to withstand extremely cold weather is difficult enough that Alaska makes you take a special test to be a licensed structural engineer. On top of this, there’s lab-specific requirements as well.
Difficult construction environment - Many places with extremely cold weather simply do all their construction in the warmer months to avoid the difficulties of cold-weather construction . Construction in the Antarctic doesn’t have this luxury.
Involved logistics - All construction materials, equipment, and labor need to be brought in from overseas, and construction takes place in an environment without any support services (electricity, running water, nearby home depot where you can pick up any tools you forgot).
The above price is what Brazil is paying for their new Antarctic base, which was designed by a Brazilian architect and will be built by a Chinese company.
Titan I Missile Complex - $30,000 per square foot
Built during the Cold War, the Titan I complexes were products of nearly unlimited defense budgets. These were sprawling installations built 40 feet underground, with 50,000 square feet of occupiable space and the capability to support 150 personnel. A Titan I complex had 3 missile silos, and was designed to survive a nuclear strike
This price is based on inflation-adjusted 1960s dollars - the actual cost to build one today would likely be much higher.
International Space Station - $100,000,000 per square foot
Push your expense dials to 11, and you get the difficulty of building in space. A space station can’t stop at providing electricity or plumbing - it needs to provide all the services a building provides, PLUS the services surrounding buildings provide (water, power), PLUS the ones the earth itself provides (breathable air, protection from radiation, etc.). And leaving a gravity well is mind-bogglingly expensive - just lifting the mass of the international space station into orbit costs nearly 10 billion dollars.
The above cost is circa 2010, and is based on dividing the habitable volume by 9 feet (typical ceiling height).
Looking at the costs laid out like this, we can see a few patterns at work:
Cost tracks weight
First, cost roughly tracks building system weight. The cheapest systems (fabric structures, metal buildings, Quonset huts) are made from a light, thin, cladding, with just enough structure to hold it up. The heavier you go, the more expensive your building gets.
Parking garages might seem to be an outlier, as they’re a heavy concrete structure on the less expensive end of the spectrum. But they don’t look quite as inexpensive when you consider that they’re basically just a structural frame, without many services or finishes.
Cost tracks functionality
Cost also closely tracks how much functionality your building has. The inexpensive buildings are little more than an unadorned structural shell. The more you add on things like electrical, HVAC, and interior finishes, the more expensive your building gets. The most expensive buildings tend to have a lot of highly specialized equipment and services in them.
Cost tracks disparity between internal and external environments
The bigger the difference between the interior and the exterior of a building, the higher the cost. Inexpensive fabric and sheet steel structures offer very basic protection from the environment, and the interior of a parking garage is totally exposed to the outside air. On the other end of the spectrum, the expensive buildings (hospitals, missile complexes, Antarctic outposts) must maintain a large differential between the inside and outside environment, whether it’s air 100 degrees warmer than outside, or protection from a 100 psi nuclear blast. The more the building needs to resist entropy, the more expensive it is.
There’s also some patterns that didn’t show up as clearly as I expected them to:
Cost does track transportation costs, but not amazingly straightforwardly. The low-end items on the list (hoop houses, tents, even metal buildings) can be profitably fabricated overseas, whereas a wood or concrete framed building will be built using regional materials.
There doesn't seem to be a big step in costs when you move from factory produced goods to site-built buildings. The line between the two actually gets somewhat blurry.
Consider for instance the metal building and the prefab storage shed. These do roughly the same job, just at a different scale. They’re both simple enclosures that keep the elements out (though of course you can add functionality to a metal building). Though we’d consider the metal building “site built” and the storage shed “prefab”, the actual assembly process looks pretty similar between them. Factory-produced components (resin panels for the shed, steel sections and corrugated deck for the metal building) get shipped to the jobsite and assembled using simple hand-tools.
And despite being “site-built”, their costs per square foot are actually pretty close. The metal building does cost a bit more per square foot, but it also requires a lot more effort - site preparation, pouring a concrete slab, permitting, labor to erect, etc.
Circling back to the beginning, maybe the question to ask then is what makes dollars per unit area a reasonable cost measure?
For one, buildings aren’t 2D, but 3D - as they get larger, they should use proportionally less material to enclose their volume . A 5x5 shed that’s 10 feet tall will have 225 square feet of surface to enclose 25 square feet of space, or 9 square feet per square foot. Make it a 50x50 metal building, and it’ll have 4500 square feet of surface to enclose 2500 square feet of space, or 1.8 square feet per square foot. (Couched this way, the metal building doesn’t look so cheap all of a sudden).
And cost per unit area implies that there aren’t savings to be had as a project gets larger. But why should this be true? In general things have a fixed cost component and a variable cost component, and all else being equal we should expect a building that’s double the size to be less than double the cost, as the same fixed cost gets spread over a larger area. So it’s curious that buildings are priced as if this isn’t true.
 - This style of pricing is fairly universal, the other countries generally use “per square meter”
 - This is actually a popular use for prefabricated construction, as a prefab building can be put up extremely quickly.
 - This will be less true of residential construction, which will generally be partitioned into similarly sized rooms regardless of how big the building itself gets. But it will be true of other construction types.
Sense - Appliance that hooks up to your fuse box and sends a report to your phone of where your electricity use is. In general I think there’s a lot of potential value to unlock in technology that gives you more visibility, and more granular control over your building environment.
Gas Stove Health Risks - Cooking with natural gas is apparently associated with a variety of poor health outcomes, including asthma. Indoor air quality is another area where it’d be helpful to have a lot more information - I’ve love something that sensed CO, CO2, humidity, mold, and other pollutants all in a single device, but as far as I’m aware nothing like that exists.
Future of Homebuilding Podcast - Six episode podcast on the future of homebuilding. There’s a lot of familiar criticisms (“why can’t we build homes the way we build cars?”), but it’s an interesting snapshot of the prefab startup ecosystem circa 2017.