A Pre-Construction report is a comprehensive assessment of a construction project, usually prior to commencement. It’s an essential step in the planning process that helps identify the construction cost, potential issues and risks that ensure a successful development. In this article, we’ll explore what a preconstruction report is and how it contributes to the development.
What is a Pre-Construction Report?
A Pre-Construction Report is a detailed assessment of a construction project that is conducted before any building work begins. This report is then relied upon by the funder to facilitate the Valuation report and to allow the funder to make an informed decision on whether to fund the project to minimize the risk.
This report is based on a detailed measurement of the building plans, as well as an supporting documentation. The measurement is trade based and is different to the estimate used in a council cost report or cost plan. A trade based estimate looks into each individual trade in more depth providing a more accurate representation of the cost of construction.
A Pre-Construction report takes into consideration a variety of factors which are then documented into the report.
What information does it include?
A preconstruction report includes information from a variety of sources and a detailed trade based estimate. The report aims to provide a comprehensive overview of the costs associated with the project, identify and make comment on all relevant documentation and identify any associated risks.
Why does a Funder require a Quantity Surveyor Report?
Banks and Financiers require a Quantity Surveyor report to establish the construction cost and risk factors of a project and to allow them to determine whether the project is viable for funding. The funder relies upon a qualified third party Quantity Surveyor generally that is officially on their QS Panel to provide an independent report which verifies the cost of construction, confirms the time frame and identify any risks that may be of consequence to the funder in accordance with the funders brief.
Essentially, a Quantity Surveyor Report is there to ensure that the funder is not entering into a risky project. The funder is looking for any potential issues that may arise during the construction process to determine if there will be any costly delays or set backs.
Once the project funding is approved, the funder will continue to rely upon the Quantity Surveyor to assess the value of works completed against the trade based estimate within the preconstruction report generally on a monthly basis to report on progress, expenditure, time, authorities, quality of work and any issues that have come to light so it is important to have this preconstruction report as a baseline.
Who should prepare a Pre-Construction Report?
A Pre-Construction report for funding purposes should be prepared by a registered Quantity Surveyor. Most banks will require you to use a firm that is on their approved panel, as they have verified that their reports cover all their requirements.
QPC & C is on the panels of all the major banks in Australia and the panels of a large number of second tier lenders. QPC & C have also worked with many private funders.