Cost to build New Apartment Complex?

Question

So, I have been looking at buying this old hotel on 1.06 acres, which has not been used for 30 years, and turning it into apartments. But, the remodel numbers are coming in at 900k for 12,445.0 sq ft of remodeled space.  The old hotel is all on one level. It has been suggested it may be Cheaper to build new apartments.  What would be the most efficient way to find the cost to build new apartments in eastern Montana? Is there a sq ft number that would give me a good idea to start off with? Any advice would be deeply appreciated, Even other ideas of what to do with the property.  We will most likely purchase it for 30k give or take.

Keith Miller · Answer

Good question! I'd start by calling general contractors and builders and ask them for a rough idea of cost per sq ft. You will need a local contractor to be able to tell you that. I can tell you that in Missoula, the costs of building are around $170-230 per sq ft, if you have a cost conscious builder. But that doesn't include any of the significant costs that go into building new apartments, including permits, architects, civil engineers, surveys, etc. I can't give you very specific ideas about what to do with the site, or what other options you have, without additional details. But I can tell you that it would be a 2-4 year-long process to redevelop the site, and you should incorporate demolition costs if you plan on scraping it. A ballpark guess for that would be between $50-100K.

Jonathan Carpenter · Answer

Your remodel cost looks pretty reasonable honestly, if I'm doing my math right. Keith is right on pricing out here in Western Montana. I haven't gotten a bid for less than $250/sqft recently.

Sounds like a cool project though. I'd love to find something like that out here! I love restoring older buildings!