- Project plans
- Project activities
- Legislation and standards
- Industry context
Last edited 09 Aug 2018
The term ‘estimate’ is a very broad one that refers to any activity that attempts to quantify something. In the construction industry, it is typically used in relation to the approximate costs associated with a construction project, used, for example to assess the viability or affordability of the project or aspects of it.
An estimate is an attempt to predict the likely expenditures associated with a project as accurately as possible. The degree of detail and the accuracy of estimates will typically increase as the project progresses, more decisions have been made, and more information it available, however, their true accuracy only becomes apparent once the project is complete and the actual costs incurred.
- Benchmarking, which is a process by which other similar projects are used as comparisons.
- Breaking down an overall estimated construction cost into percentages for different elements, based on the experience of the cost consultant.
- Measuring defined quantities from drawings.
Initial cost estimates might include wider project costs that the client might incur, such as; fees, equipment costs, furniture, the cost of moving staff, contracts outside of the main works, and so on. Later in the project, estimates are likely to focus on the construction cost of the project. It is important to be clear therefore what costs are being included in estimates, and estimates might be accompanied by a schedule of the assumptions that have been made.
Estimates will generally include contingencies, which are downside risk estimates that make allowance for unknown risks associated with a project. At the preliminary business plan stage, estimates might include a 15% contingency, but this may then be reduced as the project progresses and risks pass.
 Find out more
 Related articles on Designing Buildings Wiki
- Base cost estimate.
- Building works estimate.
- Cash flow projection.
- Common mistakes in bill of quantities.
- Cost overruns.
- Cost plan
- Elemental method.
- Extra over (EO).
- Initial cost appraisal.
- Irrelevant cost.
- Post tender estimate.
- Pre-tender estimate.
- Spon's Price Book.
- Tender pricing document.
Featured articles and news
Our duty to prevent harm and protect each other.
A quality perspective.
If buildings were people, they would be just starting to walk on two legs.
Air filtration and clean air standards.
The Dukes of Normandy and the second world war.
Conserving structures in historic designed landscapes.
Online platform to showcase acoustic solutions.
The drivers of value and how it is measured.
Do you know your Ionic from your Doric?
Construction output has been stronger than anticipated.
But blame is directed at the construction industry.