Comprehensive analysis
We have adapted details from Turner & Townsend’s Global Occupier Fit-Out Cost report 2023 and adjusted the cost to the current year to obtain our index.
The index draws on the knowledge base of real estate construction insights from around the world and data related to key Shell real estate locations have been extracted and analysed.
The cost values in this report is presented in US Dollars to enable an insightful comparison between locations. It must be noted that not all cities commonly adhere to the specifications contained within the cost model, however, a similar product representing the same level of quality was priced to allow for a consistent output and locations comparability. Upon receipt of the fully priced cost model, each city was compared to Turner & Townsend global benchmarking to confirm alignment within an acceptable tolerance. All costs were then converted into United States Dollars.
Figure 7:
The Global Occupier Fit-Out Cost - Spotlight Locations
Message from Chong Fong Yee
“Global Cost Index provides vital, data-driven insights into fit out costs, empowering Shell RE community to navigate market trends, mitigate the effects of inflation, and ensure projects align with industry best practices. By leveraging this index, Shell RE community can enhance strategic planning, optimize resource allocation, and drive greater efficiency. The result is stronger decision-making, improved project outcomes, and sustained competitive advantage, positioning Shell RE community to thrive in a rapidly evolving industry.”
Chong Fong Yee Central PMO, Cost Benchmarking Lead
Insight
Location insights and data
Insight
Location insights and data
The index draws on the knowledge base of real estate construction insights from around the world and data related to key Shell real estate locations have been extracted and analysed.
This index adjusted based on the cost data from the global occupier fit-out cost is meant to provide a picture of total project costs including the major cost components of construction costs across different markets in the spotlight locations.
The cost values in this report have been converted to US Dollars to enable an insightful comparison which gives typical project costs in each country. It should also be noted that a change in the exchange rate makes a significant difference: if a particular currency is strong compared to the base currency, the cost of construction looks expensive. It is not a reliable indicator of relative costs and efficiency of construction between countries.
It also arms Shell real estate professionals with some indicative high-level costs for a standard workplace when having the conversations with their business partners during the annual OP exercise, or when discussing fit-out opportunities further along in the pipeline.
The cost per sqm provided should not be used as a base for detailed costing. The costs per sqm are also not meant to scaled up or down parametrically, since functional space planning, building services, and IT & AV costs provisions will differ significantly when applied to larger or smaller floor areas.
Actual costs are dependent on building design, inclusions, exclusions, and site conditions. Cost comparisons between locations are subject to different interpretations, building methods, and standards for costing, measurement, and construction. Costs may vary substantially between regions within countries.
Turner & Townsend recommends in the first instance to seek the advice of a local Turner & Townsend representative or our real estate PMO team for consultation on cost estimates.
Message from Rynell Lai
“A global comparison of real estate projects highlights the key factors influencing construction costs and underscores the importance of leveraging market data and insights during initial project discussions to achieve more accurate cost estimates”
Rynell Lai Central PMO, Cost Estimating Lead
Insight
Terms and reference
The project specifications used in the adjusted cost details shown in the “The occupier index” section are primarily built around the test fit of approximately 4,700m2. Please refer to the Global occupier fit-out report for the definition of the specifications.
It was utilised to estimate construction costs for a CAT A and B fit-out. The detailed inclusions and exclusions can be found in the following sections. 1 m2 = 10.7639 ft2
The costs contained within this report are:
- Construction cost only, inclusive of AV, structured cabling and security.
- Based on a CAT A and CAT B fit-out with the existing building at shell and core.
- Reflective of a single test fit and specification level split between high, medium and low (Refer to Appendix 1 for each specification level).
The cost excludes:
- Furniture, fittings and equipment (FF&E); loose furniture works such as desks, chairs, lockers, breakout furniture, white goods and equipment not built within the joinery (millwork)
- Internal planting
- MEP works related to generator sets, major trading offices or data centres
- IT networking, such as racks
- Specialist security requirements, such as speed gates
- Software and/or apps for IT, AV and security.
- Consultancy fees, such as project and cost management, and design related services
- Move and move management costs
- Landlord lobbies or receptions
- Vertical transportation
- Structural modifications
- Reinstatement costs
- All taxes.
