Pros and Cons of Phasing Your Project
Lots of potential clients tell us they want to work out a master plan now, then phase in their projects over the upcoming years. We have helped some of them develop master plans, and can help you with this as well. But, is it a good idea?
Phasing does NOT save money. It will always cost you more in total than doing the project all at once. We have a myth-busting section below, but still wanted to get that out there right away. So, unless you are phasing for one of these four reasons, we recommend planning and building your whole project at once. Of course each situation is different, so you may have another compelling reason to phase that we haven’t listed here.
Four Good Reasons to Phase
- Safety. Your home needs work to protect your family or the building itself. But you don’t have enough time or money (or both) to develop a thorough project that addresses your “wants.”
- Future phases may never be built. You just can’t stand living in your house the way it is, but you’re not sure you’ll live there for long (or you think you may change your mind about future phases, etc.). In this case, concentrate on fixing the worst problems now and leave the future up in the air.
- Shortage of Funds. You have limited access to cash and credit, but are expecting another significant source of money in the future (ability to borrow, inheritance, sale of a company, sale of another property, vesting of stock options, compounded savings over a short period of years, etc.). You can complete the initial project now and use the new money for future phases. Or if you can live with your house for the moment, start planning the project now and build it later in one phase when you have all the resources available.
- You really can’t move out of your home for some reason, for example physical disability or family situation. You will not incur the costs of moving out completely, but will still have to move your belongings around the house. And although you will not have to find another place to stay, what you save in rent may not offset the additional costs of phasing. In this case, you may be forced to spend a little extra. If you find that you can move out, we recommend you do that and build the project in one phase.
Myths about Phasing
Myth: It’s a good idea to get a minor permit now and start the project, then apply for the more complicated permits while we’re under construction.
- This may work in some cases, particularly if the initial project and the more complicated one aren’t really related. But…
- Some building departments make you stop work on a project if you submit for another permit.
- Your planning may not be complete if you rush into a project, which could mean you start building something that you’ll have to end up taking apart. Or,
- Your more complicated permit might not be approved, and you’d be halfway through a project that must be changed completely.
Myth: Phasing will mean less impact on my life. I’d rather just do a little bit at a time… it will be more manageable.
- Stretching the project out over a few years means you’ll have to keep dealing with construction indefinitely instead of getting it all over at once.
- After the first phase, some people aren’t mentally ready to come back for more construction any time soon.
- You will have less time to live in the improved house. Why not improve it all now, and enjoy it for longer?
Myth: If I phase, I won’t have to move out. That will save me money and hassle.
- Living in a house during construction is no picnic. While some of our clients have done it in the past, many of them wish they hadn’t. You will have unexpected inconveniences like no heat, no plumbing, etc. for a period of time. And remember – you’re living in a loud and dusty construction site.
- Living in your house during construction has a cost. It creates work for the contractors. They have to try to keep you and your family safe (both from intruders and from the dangers / mess of construction) by building temporary walls and exits. They also have to clean up more and some contractors tell me they estimate extra project management time because people who live in the house will take up half-an-hour of the superintendent’s time every day asking about the work in progress.
Myth: Phasing will cost me less.
Truth: Phasing will cost you more. Both in construction costs and soft costs. Here’s why:
Construction Cost will be Higher if you Phase
These days construction is not as cheap as it was when we found it to “bottom out” near the end of 2009… but it’s still much less expensive than it was during the housing boom. Good contractors are now available to not only return your calls, but to start construction soon and charge you a very reasonable price. What you could get done now for a certain price is likely to cost more in the future.
When phasing construction, reduced economies of scale and redundant costs will always make the project more expensive than if it is constructed in a single phase. Basically, larger projects have more economy of scale than a bunch of smaller projects. For example:
- Some areas may be completed, cleaned up, then re-opened in a subsequent phase.
- The contractor and subcontractors must set up and take down multiple times.
- Contractors like to find ways to keep their workers busy whenever they can. On a bigger project there will be more opportunities to keep everyone busy with useful work. On a few smaller projects workers will be waiting around with nothing to do more often.
- Material costs will be higher since some materials purchased for phase 1 may be damaged or replaced in phase 2; and inflation may mean that materials purchased in phase 2 are likely to be more expensive.
Soft Costs will be Higher if you Phase
- Architectural and Engineering fees will always be higher when phasing construction because of redundant work. Each submittal to the building department, planning department, and contractor must be complete in its own right. Therefore the cost of creating multiple versions, checking them for quality, and distributing them will always be higher.
- Building permit fees will be higher because most building departments charge fixed fees for parts of the permit cost, and you’ll have to pay those for each project.
- The longer schedule and possible repetition of construction trades and processes may require extra site visits by the design team during the construction phase.
Soft Costs could be even Higher than that
If you change your mind during the process, it would require the design team to re-work portions of the drawings, calculations, and specifications that may have been partially or fully completed. Of course this will result in additional fees. Owners have changed their minds in the past about:
What is in and out of each phase. Whether to phase after all, or request that work already in progress by the design team be consolidated into a single set of documentation. Their phasing strategy. This can lead to massive changes of the construction documents.
How to Phase?
If phasing still seems like the best option after considering all of the above, Klopf Architecture will help you plan for your phased project.
In the past we have created overall plans for entire properties. We’ve developed them into master plans while helping our clients choose which portions of the work to do first.
The master plan usually includes a somewhat developed design of the entire project so that all major conflicts and many minor ones can be eliminated. That means the architect must develop more than just a site plan and floor plans. We have created building sections and exterior elevations, and even chosen certain materials in the master planning phase. Often much of this work is then set aside after the client is satisfied with the master plan.
When permitting the work in phases, we typically complete a full set of permit documentation that only pertains to phase one. Then for future phases we will create additional complete sets for each subsequent phase.