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About AECOM

At AECOM, we believe infrastructure creates opportunity for everyone.

Commercial office tower cost model

AECOM's Andrew Thompson, Head of Offices, Corporate Solutions & Residential End Markets takes a closer look at some of the key cost drivers for commercial office towers and concludes with a cost model for a typical commercial office tower in the Middle East region.

The biggest cost drivers for towers, and those influenced the most by design, remain the structure, facades (and their interface) and the MEP services. As tower design evolves the prevailing trends such as increased structural grids, floor-to-ceiling heights and location of cores impact the design response.

Structure

Structural systems for tall buildings are driven by a combination of architectural, economical and site factors. Building form and height is clearly critical, as are the net-to-gross areas. The nature of the site itself will also have an impact.

With land values in major EMEA cities rising, developers are exploring more challenging sites (infills, tunnels or old industrial land) that may require a more complex structural solution.

Structural framing solutions will continue to depend on the building’s intended use. In the residential sector, tall buildings are usually concrete framed with flat slabs. This reduces the structural zone and allows floor-to-floor heights to be minimised, providing a more economical design for this sector. In contrast, commercial tall buildings deploy either a composite (steel and concrete), concrete or steel frame. Steel frames allow longer spans than traditional reinforced concrete, giving developers more flexibility in the use of space and enabling column-free floor plates to be provided, however steel framed buildings still remain less economical than concrete frame buildings in the Middle East.

With the increased appetite for taller buildings and larger floor plates, braced tubes or bracing on the perimeter are increasingly common. How this is incorporated into the design and its interface with the facade is a key cost driver. Exposing structure and making it an architectural feature can give the design some edge but can be more expensive.

Increasing floor-to-ceiling height, without increasing the overall storey heights can be achieved by reducing the structural and services zone within the ceiling. However, this, in combination with the larger spans, will add weight to a steel frame.

Another important design trend is the preference for offset cores. They appeal to developers and architects looking for a greater flexibility, adaptability and efficiency of floor space.

But they pose a greater challenge to structural engineers, as an offset core generates higher torsional forces, which could result in the need for expensive outrigger systems deployed to resist the torsion.

Sustainability will be a continuing and growing influence on structural engineers, driven by legislation and central government targets. Developers will need to consider alternative construction techniques and new material technologies in response. Modular systems and off-site fabrication will become more prevalent. Recycled aggregates and high-strength materials will also become more frequently used.

Cladding

One of the first studies on a tower scheme is to create a successful facade and define the performance limits. The glazing ratio of the façade will define the look of the building making it look transparent, opaque, solid or light. It’s important for the team to ask the question: how do you make the correct architectural decision but balance the requirements for amount of daylight into the building, direct sun exposure, and reduce energy use. There are a number of different options:

Natural ventilated facades: Double-skin facades have been developed to reduce the heat loads on glass envelopes, with blinds in the cavity. These vary from those with wider cavity to allow for maintenance; principally these work well but are expensive and take up floor space. Slimmer systems are available, typically with a cavity of 150mm but the cavity still needs to be maintained through opening vents, which can be disruptive to tenants.

Closed cavity facades: A system that uses compressed dry air to be pumped into the sealed cavity between the two skins, the cavity can only be reached by removing one of the glazing skins. As the blinds in the cavity cannot be accessed once manufactured, blind drive motors are fixed outside the cavity and have a driveshaft penetrating the cavity, connecting them to the blinds.

External solar shading: Fixed solar shading on the outside of the tower is an alternative solution to minimize the heat load for MEP services. The overall cladding zone incorporating the shading is wider but if the perimeter structure or bracing is exposed this can create the zone for solar shading. While there are additional costs for the solar shading elements the base cladding system behind can be a simplified and maximise on the economies of scale.

High performance double-glazed units: A fully glazed solution using unitised double-glazed units remains a possible solution. It requires enhanced G and U values achieved through high-performance coatings or by increasing the amount of solid cladding on the building. A full-height clear glazed solution will give the benefit of increased daylight but does place additional requirements on the MEP design due to the additional heat loads and sustainability requirements. In any solution the buildability requirements of the facade should be considered from the earliest design concept.

Services

The specification levels, interfaces and distribution are important considerations for the services design. The services strategy should be carefully considered at the outset, as changes later on are difficult to incorporate.

Off-set cores are a major enabler of innovation in services design, allowing options for where plant is located. Individual on-floor plant solutions house principal air handling kit at each level — the loss of space on these floors needs to be balanced with the advantage gained from freeing up wider areas at either the midpoint or at the top of the building.

Towers developed in financial districts have retained the traditional MEP design allowances to meet the requirements of tenants with higher cooling loads, resilience in services and future flexibility.

Exposed services are becoming popular with tenants, particularly those in the technology or media sectors. This is mainly an aesthetic decision and depending on the layout and specification can in fact cost more than a conventional approach.

The unique nature of towers brings with it some challenges for service design. Logistics need to be carefully thought out, and the services programme needs to reflect the time it takes to move people and materials around. Due to the height of tall buildings, the question of hydraulics and pipe pressures are critical in design terms. Towers need a greater number of pipe risers, with increased pumping requirements and basement distribution. More pipe gauges are needed and the cost of fittings, valves and so on, is higher. Hot water services need to be treated locally, and often hydraulic breaks are required. Developers may also need to evaluate whether PRVs or heat exchangers are more economic.

Electrical installation

Decisions taken around plantroom location will be critical here. Generally, HV distribution systems are the same as in other commercial offices. But levels of standby generation need to be fully explored. For commercial office towers, 100 per cent standby generation is often provided; the location is a balance between the use of roof space, which is increasingly valuable for other uses, and location within the basement and building with the acoustic and flue requirements taking up net floor area.

Lifts

Careful analysis of traffic is required to ensure lift design is fit for purpose. That said towers lead the innovations and features such as destination hall controls, first seen in high-rise buildings, are now common in all. However, lift costs for towers are often two to three times that of standard building cost. Designers will need to strike a balance — performance vs. occupational density requirements, ease of use and the space taken up by lifts and service core in the overall design. The combination of increased occupational densities and the drive to maximise efficiency in space taken by lifts can lead to a solution with sky lobbies and transfer floors to manage user flows.

Procurement and construction challenges

The construction of towers brings a different set of challenges compared to a lower rise building. Towers are specialised major projects and there are really only a few contractors who have the skilled staff and expertise to deliver them successfully. The more towers under construction in a city, the busier the main contractors will be. Simple demand and supply will result in higher pricing levels. When assessing the risk of delivering a tower, investors and developers need to include how it is viewed by the market. They need good, well-coordinated information to sell the schemes positively to the market.

The chosen procurement route needs to reflect all of this. Two-stage design and build or construction management contracts are generally more popular in Europe than single-stage agreements which in turn are more common in the Middle East.

Contractors still favour lump-sum deals, but the correct sharing of risks between contractor and developer is essential in the current market. To deliver maximum value to the tall building client it can be beneficial to engage with trades and the main contractor’s advice can be sought and inputted into the design process at an early stage. This allows the contractor’s expertise to be designed in, and waste and inefficiencies to be designed out early, when most value can be created.

Construction

Continuous innovation is important to stay ahead in construction — and tall buildings are seen as the test bed of the construction industry, with innovations trickling down to regular construction projects once proven on tall buildings.

The current swathe of innovations are across many specialist trades, but all are aimed at reducing the critical path of the construction period including: high strength concrete allowing slimmer columns, beams and slabs, quicker curing and striking, hence quicker frame cycle times; high-strength steel allowing slimmer double or triple-storey members and quicker erecting; advancements in jump lifts enabling the early use of lifts in lieu of hoists within weather-protected lift shafts by building temporary crash decks and lift motor rooms; advancements in unitised cladding installation methods, speeding up the weatherproofing of the tower.

Modularisation, or off-site manufacture and assembly, is a very exciting area of construction innovation, potentially offering real productivity benefits to the tall building, if the current glass ceiling of 30 storeys can be broken. The well designed tall building form tends to be inherently modular with simplicity, repetition, standardisation and economies of scale designed in. Modular construction is already viable in most regions and is even the preferred form of building in some market sectors, but generally remains uncommon in MENA. The key benefits to using modular construction for a tall building include: speed of erection, commissioning and handover; quality, as the product is built in a controlled environment yielding higher productivity and quality; safety, as less time is needed on site and working at height; sustainability, due to better thermal and acoustic performance along with reduced waste; innovation, in the form of increased prototyping, and factory testing of new technology effectively de-risks the on-site use of the new tech.

These are all very desirable benefits when building a tall building, but there are key construction challenges to be overcome: planning the logistics route of modular units from factory to site, adhering to articulated lorry standard sizes and avoiding low bridges; tower crane selection will need upsizing in both load and reach capacity; site layout needs to allow clear material handling areas to lift the modules directly off the back of the vehicles, necessitating the use of just-in-time deliveries and an out-of-town consolidation centre to ensure exact timing of each module delivery, minimising congestion of city centre roads around the tall building and maximising hook-time efficiency. There is also the risk that the modular industry is small and predominantly based in central Europe and Asia with very limited supply in EMEA.

This makes procurement and performance risky.

The tall building principal contractor will be nervous about having such a strong dependence on a single source determining the success or failure of their high-profile tall building project.

Utilities

The requirements and size of incoming supplies for a new commercial tower need planning and implementing at an early stage of its development and it is advisable to engage with the statutory utilities at the earliest opportunity.

Of particular importance is early engagement with local power networks, the incumbent electrical distribution network operator. Electrical connections in cities have to be planned well in advance as it is common for the point of connection for a power supply to be a fair distance away from the point of use. To install cabling through the streets of busy cities requires planning in advance and can be very expensive to deliver.

Due to their size some typical commercial office tower developments can be connected in excess of 30,000 volts. This has an effect on the overall connection arrangement and cost with the transformer provisions are much larger within the buildings itself and the capital cost is significantly higher also.

###Cost model

There is a wide range of cost for commercial office towers, when measured on a AED/m2 basis over the gross floor area. Shell and core prices can range greatly.

This range is primarily influenced by the architectural response to a site and its interface with the required structural solution, followed by overall specification levels and then height.

The following cost model summarises the shell core cost of a notional premium grade high-rise office tower in a major city in the Middle East. It has a gross floor area of 100,000m2 over 50 floors above ground and five basement levels. It has an overall net-to-gross ratio of 70 per cent and a wall-to-floor ratio of 0.50.

The model reflects a summarised elemental cost breakdown obtained from a competitive tender through a traditional single stage fixed-price, lump-sum arrangement. The cost model includes for all main contractor preliminaries and risk allowance to complete the building to a shell and core status with front-of-house (FoH) and back-of-house (BoH) areas finished to a high standard. Demolition, enabling works, external works, external services, category A fit out, tenant enhancements, professional fees and VAT are all excluded.

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