Managing the Development of Building Projects for Better Results

First published in 1981, updated for web presentation, Dec. 2000

Introduction | Principal Parties | Project Plan | Improving Performance
Project Life Cycle | Bar Chart Schedule | Manpower Loading Data
Information Explosion | Final Cost | Design Stages | Cost Effectiveness
Choices | Construction Costing | Value Management | Design Review
Cost of Building Ownership | Practice and Value Management | Summary

Life Cycle Cost of Building Ownership

Figure 7 shows the total overall cost of ownership of a typical office building over a forty year life cycle. It is interesting to note that the initial costs are only one half of the total cost. For buildings that are more labor intensive in their operations, such as airports and hospitals, the capital cost fraction may be less than 10%. Conversely, for buildings such as museums and churches, the proportion is much higher.

Figure 7: Cost of Ownership

Consequently, focus only on initial cost without regard to the present value of future maintenance and operating costs is often a serious shortcoming in the programming, planning and design of facilities.

Stages of a Value Management Design Review  Stages of a Value Management Design Review

Home | Issacons | PM Glossary | Papers & Books | Max's Musings
Guest Articles | Contact Info | Search My Site | Site Map | Top of Page