The cost per square foot of retail space is a common calculation used in commercial real estate and construction. If the retail space is not built, the calculation is a useful benchmark for estimating construction costs. If the retail space is already built, you can use the figure to break down your construction costs. You can calculate the cost per square foot of retail space if you know some basic information about the cost or estimated cost of construction and the total square footage of the retail space.
- Skill level:
- Moderately Easy
Determine the total square footage of the retail space. This is normally calculated by multiplying the length of the space by the width. As an example, assume the total square footage of the retail space is 2,500 square feet.
Determine the total cost of building the retail space. If the space is already built, this figure is your actual cost of building the space. If the space is not built, this figure is an estimate of the total building cost and includes all materials (nails, wood, flooring, etc.) and labour. For this example, assume the total cost to build the retail space was £65,000.
Divide the total cost figure from Step 2 by the total square footage figure from Step 1. Continuing the same example: £65,000 / 2,500 = £26. This figure represents the cost per square foot of the retail space.
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