The document provides information on construction cost engineering in the Philippines, including: - Types of construction costs such as preliminary estimates, government project costs of 30,000-35,000 PHP per sqm, and residential building costs ranging from 5,000-15,000 PHP per sqm depending on the province. - Non-residential building costs nationally average 8,788-16,211 PHP per sqm depending on the type of building, and also vary by province from 5,000-28,000 PHP per sqm. - International construction cost data from Arcadis finds residential and commercial costs in the Philippines to be much higher, ranging from 36,813-92,080 PHP per

1. INTRODUCTION
TO
CONSTRUCTION
COST
ENGINEERING
CE 423

2. TABLE OF CONTENTS
What is
construction
cost?
What are the
types of
construction
cost?
What are the
basis in
estimating the
cost of projects?
01 02 03
Government projects
Residential projects
Non-residential projects

3. INTRODUCTIO
N
CONSTRUCTION COST ENGINEERING
• expenses incurred by a contractor for labor,
material, equipment, financing, services, utilities,
etc., plus overheads and contractor's profit.
• The costs such as the purchase of land,
architectural design, consultant and engineer's fee
are not part of construction costs.

4. TYPES OF
CONSTRUCTION
COST
I.

5. Also called an abstract cost estimate or approximate cost
estimate or budget estimate.
● This estimate is generally prepared in initial stages to know the
approximate cost of the project.You can organize your ideas
clearly.
● By this estimate, the competent sanctioning authority can
decide the financial position and policy for the administration
section.
● Preliminary estimates are prepared with reference to the cost of
similar type projects in a practical manner. In this estimate, the
approximate cost of each important item of work is displayed
individually to know the necessity and utility of each item of
work.
● cost of lands, cost of roads, electrification, water supply costs,
cost of each building, etc.
A. PRELIMINARY COST ESTIMATE

6. 1. Cost per sq.m. of Government Infrastructure
Projects in the Philippines :
In determining preliminary
estimates for Government
Infrastructure Projects in the
Philippines for the purpose of
budget allocation in the
National Expenditures
Program (NEP), there is a
guidelines by the DBM –
DPWH Joint Circular No. 1
dated October 20, 2016.
30,000 to 35,000 per sq.meter –
parametric construction cost of
government buildings.
40,000 to 50,000 per sq. meter – if
the land/lot is reclaimed as “soft soil”
and those near fault lines.
Note: Said ballpark figures are
already inclusive of the overhead,
contingencies and miscellaneous
expenses, as well as the contractor's
profit and value added tax.

7. 2. Cost per sq.m. of Residential Buildings in the
Philippines:
a. Single family home - national
average cost of building was ₱9,949
per square meter in 2019 and
₱9,475 per square meter in 2018,
which was a 5% increase from the
previous year.
b. Quadruplex or duplex house -
decreased from ₱10,126 in 2018 to
₱9,553 in 2019.
Based from Philippines
Statistics Authority
(PSA) survey.
c. Apartments – decreased from
₱8743 (2018) to ₱8577 (2019).
d. Condominiums - decreased from
₱18776 (2018) to ₱15094 (2019).
e. Other residences - decreased
from ₱9210 (2018) to ₱7583(2019).

9. 2. Cost per sq.m. of Residential Buildings in the
Philippines:
a. . The cost range is ₱5,000 to ₱15,000 per m2.
b. The cheapest places to build a residence are Lanao Del Norte, Compostela Valley,
Camigiun, Zamboanga Del Norte and North Cotabato at ₱5,000 per m2.
c. These are followed by Sarangani and Maguindanao (excluding Cotabato City) at
₱6,000 per m2.
d. Nine provinces of the Philippines, namely Negros Oriental, Davao Del Norte, Dinagat
Islands, Surigao Del Norte, Isabela City, Bukidnon, Aurora, Agusan Del Norte and
Leyte are priced at ₱7,000 per m2 for new home construction.
e. The province of Guimaras, Misamis Occidental, Occidental Mindoro, Bulacan,
Romblon, Apayao, Ifugao, Marindique, Agusan Del Sur, Third District and Bohol come
in at an average price of ₱8,000 per m2 for a newly built residence.
Provincial/Regional Average Costs for New Residences

10. 2. Cost per sq.m. of Residential Buildings in the
Philippines:
f. Fifteen provinces, Davao Occidental, Misamis Oriental, Cavite, Northern Samar, Davao
Oriental, Abra, South Cotabato, Cagayan, Zamboanga Sibugay, Lanao Del Sur, Oriental
Mindoro, Southern Leyte, Ilocos Sur, Batangas, Tarlac and Biliran have a residential
building cost rate of ₱9,000 per m2.
g. Seventeen provinces in the Philippines, Siquijor, Kalinga, La Union, Sultan Kudarat,
Ilocos Norte, Zamboanga Del Sur, Cotabato City, Zambales, Sorsogon, Camarines Sur,
Negros Occidental, Catanduanes, Nueva Ecija, Eastern Samar, Quirino, Nueva Vizcaya,
Western Samar and Pangasinan have a building cost per square meter of ₱10,000.
h. Then twenty provinces in the country fall under this category. It will cost you 11,000
pesos per m2 to build a new residence in the province of Capiz, Iloilo, Isabela, Rizal,
Bataan, Antique, Cebu, Aklan and Pampanga.
Provincial/Regional Average Costs for New Residences

11. 2. Cost per sq.m. of Residential Buildings in the
Philippines:
i. Three provinces, First District, Quezon and Albay are priced at 12,000 pesos per m2 for
new residential buildings.
j. Building a new home in Laguna, Camarines Norte, Benguet, Palawan and Second
District will cost you 13,000 pesos per square meter. The most expensive place to build a
new home is Batanes at 15,000 pesos per square meter, followed by Davao Del Sur,
Masbate and Fourth District at ₱14,000 per m2.
Provincial/Regional Average Costs for New Residences

13. 3. Cost per sq.m. of Non - Residential Buildings in
the Philippines:
Table: National average cost
2018 2019 Percentage
(Increase
or
decrease)
Commercial
property
₱8,788 /sq. meter ₱10,626 /sq. meter 20.9 %
Industrial property ₱6,530 /sq. meter ₱7,084 per m2 8.5%
Institutional
buildings
₱13,970 per m2 ₱16,211 per m2 13.82%
Agricultural
facilities
₱4,845 per m2 ₱4,421 per m2 -8.7%

14. Additions in the non-residential category realized an increase in
construction costs, with the superficial floor area building rates rising
from ₱9,359 to ₱10,795 per m2 in 2018 and 2019 respectively.

15. 3. Cost per sq.m. of Non - Residential Buildings in
the Philippines:
Provincial/Regional
Average Costs for
New Non-
Residential
Buildings

16. 3. Cost per sq.m. of Non - Residential Buildings in
the Philippines:
Provincial/Regional Average Costs for New Non-
Residential Buildings
• The average building cost per square meter for non-residential buildings in each of the
81 provinces in the Philippines. The cost range is ₱5,000 to ₱28,000 per m2.
a. Abra and Bulacan at ₱5,000 per m2 (cheapest)
b. Camarines Norte, North Cotabato, Apayao and Lanao Del Norte at ₱6,000 per m2.
c. Six provinces of the Philippines, namely Leyte, Zamboaga Del Sur, Occidental
Mindoro, Isabela, Dinagat Islands, Third District and Bohol are priced at ₱7,000 per
m2 for new non-residential construction.
d. The province of Western Samar, Agusan Del Sur, Guimaras, Bukidnon, Zambales,
Palawan, Surigao Del Norte, South Cotabato, Southern Leyte, La Union, Nueva Ecija
and Oriental Mindoro come in at an average price of ₱8,000 per m2 for a newly built
commercial, industrial or institutional facility.

17. 3. Cost per sq.m. of Non - Residential Buildings in
the Philippines:
Provincial/Regional Average Costs for New Non-
Residential Buildings
• The average building cost per square meter for non-residential buildings in each of the
81 provinces in the Philippines. The cost range is ₱5,000 to ₱28,000 per m2.
e. Ten provinces, Cavite, Pampanga, Catanduanes, Masbate, Laguna, Sorsogon,
Marinduque, Camarines Sur, Ilocos Norte and Nueva Vizcaya have a non-residential
building cost rate of ₱9,000 per m2.
f. Eight provinces in the Philippines, Davao Del Sur, Rizal, Davao Del Norte, Bataan,
Lanao Del Sur, Cagayan, Siquijor, Misamis Occidental and Misamis Oriental have a
building cost per square metre of ₱10,000.
g. If anything above ₱10,000 per m2 is considered expensive, then thirty seven provinces
in the country fall under this category. It will cost you 11,000 pesos per m2 to build a new
shopping mall, factory, higher learning institution or commercial farm in the province of
Batangas, Negros Occidental, Zamboanga Sibugay, Cebu and Albay.

18. 3. Cost per sq.m. of Non - Residential Buildings in
the Philippines:
Provincial/Regional Average Costs for New Non-
Residential Buildings
h. Eleven provinces, Sultan Kudarat, Ilocos Sur, Benguet, Kalinga, Romblon, Capiz,
Batanes, Agusan Del Norte, Antique, Isabela City, Northern Samar and Zamboanga Del
Norte are priced at 12,000 pesos per m2 for new industrial/commercial buildings.
i. Building a new facility in Iloilo, Aurora, Negros Oriental, Tarlac, First District and
Quezon will cost you 13,000 pesos per square metre. In the region of Pangasinan,
Cotabato City, Second District and Fourth District, commercial and industrial
developments cost around ₱14,000 pesos per square metre.
j. The most expensive place to build a new facility is Maguindanao (excluding Cotabato
City) at 28,000 pesos per square metre, followed by Quirino at ₱21,000 per m2, Davao
Oriental at ₱19,000 per m2 and Eastern Samar at ₱17,000 per m2.
k. Other expensive regions are Aklan, Sarangani and Ifugao at ₱16,000 per m2, Biliran,
Camiguin and Davao Occidental at ₱15,000 per m2.

19. DO YOU NEED A GRAPH?

20. Building Costs in Philippines – International
Construction Market Surveys
Arcadis Construction Cost Survey
Arcadis is a global consultancy firm founded in 1888 and based in Netherlands, specializing
in the design of projects and solutions for architecture, engineering, urban/town planning,
sustainable development, environmental engineering, transport, water and utilities.
350 branches around the world, spread across 40 countries and 28,000 employees in 70+
countries, including Europe, Middle East, Asia Pacific, North and South America.

21. ARCADIS
Arcadis PSA Rates
Average high-rise
apartments
₱39,790 to ₱46,650 per m2 ₱8743 to ₱8577 per m2
High end high-rise
apartments
₱53,526 to ₱92,080 per m2 ₱18,776 to ₱15,094 per m2
Average standard
terraced houses
₱36,813 to ₱43,581 per m2 ₱9,553 per m2
A look at the Philippines building costs per square meter by
Arcadis Inc show that they are extremely higher than PSA rates.

22. ARCADIS – Construction Costs Philippines Arcadis –
Residential Commercial Industrial
(1)

23. ARCADIS – Construction Costs Philippines Arcadis
– Residential Commercial Industrial
(2)

24. Why is there a discrepancy between Arcadis and
PSA building rates?
Well, it’s not a complicated matter. Engineering/construction management consultancies build up
rates from their own in-house cost data obtained from past and current projects. Building costs are
based on tender prices, and since these consultancies specialize in high value projects, the rates
are going to be skewed in that direction. On the other hand, PSA rates are based on building plans
approved by local authorities and their valuations thereof will represent a wider sample of
building costs in the Philippines.

25. 4. Regional Costs of Building in the Philippines –
17 Main Regions
Regional Average Costs for New Residences
The table shows the average building cost per square meter for residential buildings in
each of the 17 cultural/geographical provinces of the Philippines. The cost range is
₱7,000 to ₱13,000 per m2.
a. The cheapest regions to build a residence are the National Capital Region (NCR) at
₱7,000 per m2, followed by Cordillera Administrative Region (CAR), Ilocos Region,
Cagayan Valley and Central Luzon at ₱8,000 per m2.
b. The region of Calabarzon comes in at 9,000 per m2. Seven provinces of the
Philippines, namely MIMAROPA, Bicol, Western Visayas, Central Visayas, Eastern
Visayas, Zamboanga Peninsula, Northern Mindanao are priced at ₱10,000 per m2 for
new home construction.
c. The province of Davao Region and SOCCSKSARGEN come in at an average price of
₱11,000 per m2 for a newly built residence.

26. 4. Regional Costs of Building in the Philippines –
17 Main Regions
Regional Average Costs for New Residences
d. The most expensive region to build a home is the ARMM, with a residential building
cost rate of ₱13,000 per m2, followed by Caraga at ₱12,000 per m2.

27. 4. Regional Costs of Building in the Philippines –
17 Main Regions
Regional Average Costs for New Non-Residential
Buildings
The table shows the average building cost per square meter for non-residential buildings
in each of the 17 cultural/geographical regions in the Philippines. The cost range is
₱7,000 to ₱16,000 per m2.
a. The cheapest regions to build a commercial, institutional, industrial or agricultural
building are Bicol at ₱7,000 per m2, followed by Eastern Visayas, Calabarzon and
MIMAROPA at ₱8,000 per m2.
b. Four provinces of the Philippines, namely Zamboanga Pensinsula, Central Luzon,
SOCCSKSARGEN and Central Visayas are priced at ₱10,000 per m2 for new non-
residential construction.
c. The province of CAR comes in at an average price of ₱11,000 per m2 for a newly built
commercial, industrial or institutional facility.

28. 4. Regional Costs of Building in the Philippines –
17 Main Regions
Regional Average Costs for New Non-Residential
Buildings
d. Davao Region, Western Visayas and Cagayan Valley have a non-residential building
cost rate of ₱12,000 per m2.
e. The most expensive region to build a new facility is the NCR at 16,000 pesos per
square metre, followed by Caraga at ₱14,000 per m2, ILocos and Northern Mindanao at
₱13,000 per m2.

29. 4. Regional Costs of Building in the Philippines –
17 Main Regions
Regional Average Costs for New Non-Residential
Buildings

30. Estimating
Formats:
The estimating formats will adopt the DPWH Department Orders:
DPWH Department Order 137 series of 2017 – Cost Estimation Manual for Low Rise
Buildings
DPWH Department Order 28 series of 2019 – Cost Estimation Manual for High Rise
Buildings
DPWH Department Order 143 series of 2017 – Revised Standard Pay Item List for
Infrastructure Projects
DPWH Department Order 39 series of 2020 – Revised Construction Safety Guidelines
DPWH Department Order 197 series of 2016 – Revised Guidelines in the Preparation of
Approved Budget for the Contract.

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