opinion of probable cost

cost estimate vs opinion of probable cost

An opinion of probable cost is not an interchangeable term or the same thing as an estimation of cost.  This terminology may be a term used by architects in the preliminary or concept stages of a project. Do not make the mistake of assuming an opinion of probable cost is the same as a cost estimate.  An opinion of probable cost is simply an architect’s professional opinion based on experience and available knowledge.  Traditionally, architects have helped their clients with building budget estimates of what their building project would cost.

a professional’s opinion of probable cost

Unlike quantity surveyors, architects aren’t tertiary trained in preparing building cost estimates.  There’s been many successful court precedents across multiple jurisdictions against architectural practices who have supplied clients with inaccurate estimates.  Recently, the language for this activity has evolved to opinion of probable cost and estimates are no longer calculated.  The conspiracy theorist might suggest this evolution is about avoiding legal liability.  A cost estimate labels a building with a price while an opinion is likely to change depending on which author’s.  The difference between the two is that an opinion is a more honest, modest statement of what the project “could” cost.

opinion of probable cost definition

The legal definition of ‘opinion of probable cost’ means a level one cost estimate to facilitate budgetary and feasibility determinations.  The opinion is based on historical information with adjustments made for project specific conditions.  Irrespective of language (ie opinion or estimate) neither should not be confused with a formal bid, quote or tender submission.  An opinion is a mechanism to formulate a project’s scope or work, determine a building budget and develop a project.  The opinion includes a project matrix, including: budget items, options for reducing/increasing scope, regional pricing economic environment and contingency.

preliminaries and contingencies

Incidental costs (described as preliminaries or ‘softcosts’ in some markets) are all the expenses a client will incur that are not directly attributed to the builder working on the job.  These include: insurance costs, planning and building fees, professional design services, testing and verification costs, as well as furniture and equipment costs.  Without the preliminaries included in the overall budget, a real understanding of what the project will cost cannot be adequately established.

In the early feasibility stages of a project, a contingency sum or budget should always be allowed for unforeseen circumstance.  No matter how much planning goes into any construction endeavor, there is always the potential for latent conditions  Each project should be developed with a contingency in mind to ensure unforeseen issues don’t halt the project.

key difference between an estimate vs opinion

So what’s is the difference between an estimate and an opinion of probable cost? The estimate is based on costs per area (ie $/sq ft or $/sqm), number of rooms/seats, etc. Project information required for an estimates at this level shall include a general functional description, schematic layout, geographic location, size expressed as building area, numbers of people, seats and intended use.  The estimate is part of the whole picture that is needed to fully understand the financial implications for the client.

professional feasability services

Threadgold Architecture + Construction can work with clients through the estimating process and provide the client with an opinion of probable cost. The process starts with the architectural brief and development of the afore mentioned basic budget information.  Our practice utilizes a systematic process, where the different parts of the building are broken down into their constituent systems for evaluation.  The process differs from a system where one would count each and every nail, screw, and all other elements.  The practice’s approach also works extremely well with an established team of consultants who provide pricing information on their specific scope.