Apartment construction costs.

Multi-Family and Apartment Investing
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Apartment construction costs.

Jeff CantrellPro Member
Rental Property Investor · Jackson, TN · Member since 2018 · 45 posts · 17 votes

Those who’ve built apartment complexes, I’m interested in what the cost per unit ended up being including land development. I know there are 1000 variables that effect cost and that many will have different answers based on market and unit sizes. I’d like to here your “deep dive” on what you have personal experience with.

I’m thinking about 32-64 doors on a single lot.

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Jerry Mason
Member since 2019 · 3 posts · 7 votes
7y

Rates on what I’m presently working on, and it has been consistent for the last 5 years in DFW, is $1.00 per sq ft of livable space. 

Current project is 38 mil, all in. About 350,000 sq ft, 3 story, no elevators, 267 units, garden style, 6 buildings (club, office and amenities area is 1/3 of the lower floor of the first building), onsite detention pond of 1/2 acre, 8 acre site, 1 decel lane added. 

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  • Greg Dickerson
    Developer · Charlottesville, VA · Member since 2018 · 4k+ posts · 4k+ votes
    7y

    @Jeff Cantrell there is no way to answer this without way more detail but a building with 30-60 units mixed between 2 and 3 bedrooms can run $100k - $300k and up. Best thing to do is speak with some contractors in your area that build this type of product. They can tell you what their costs are averaging recently.

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  • Jeff CantrellPro Member
    OP
    Rental Property Investor · Jackson, TN · Member since 2018 · 45 posts · 17 votes
    7y

    @Greg Dickerson

    I’d be glad to get into more detail and would love to keep the conversation going.

    My main interest is where the cost per door ended up those who’ve built them.

    Are you saying 100-300k per door to build? I was thinking way less than that, but I may be way off base.

    And I totally realize this is a much deeper conversation than my basic question.

    Would love to hear someone’s “deal deep dive” on this.

    Thank you for the response.

    0Reply
  • Tim Johnson
    Lender · Grand Rapids, MI · Member since 2018 · 703 posts · 446 votes
    7y

    I have been a part of a couple of things and price range was crazy swings.

    Seen 65k a door up to 250K a door.  Need to figure out land costs, development costs and then construction costs.  A range can't be used on this type of deal.

    1Reply
  • Charley C.
    North of Houston · Member since 2018 · 350 posts · 181 votes
    7y

    @Jeff Cantrell  Not including the land and the Civil. 15,000 sf, all 750 sf 1 bedrooms 1-story higher end. Hard cost ran about 1.7 mill with me working there for free as the GC. Its still garden style construction but the finishes were higher end (like little custom town homes with no garages) . If I were to hire a GC or work as the GC for someone doing the same, I would of charged (or payed) about $130 a foot. More if I had to build it far from my home.

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  • Jeff CantrellPro Member
    OP
    Rental Property Investor · Jackson, TN · Member since 2018 · 45 posts · 17 votes
    7y

    @Charley C. Good info. Your numbers at 15000’ and 750’ per unit means 20 doors and at 1.7m that’s about $85k per door, so around $113/sq’. What did you spend on lot development and how big is the lot? And do you have any additional amenities like pool or park on site?

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  • Jerry Mason
    Member since 2019 · 3 posts · 7 votes
    7y

    I am a superintendent in Dallas and have built new apartments for over 35 years. Right now apartments are averaging between $120,000 and $165,000 a door in DFW. This includes land, all utilities, permitting, bonds, architect, engineers, construction and such for a class A property. 

    I did a project in Houston a few years ago for $52,000 a door. It was a section 8, low income property. No landscape other than planted grass, no amenity area, no storm utilities (the property sheet drained to a ditch), no appliances, super low end fixtures, no perimeter fence, 8’ ceilings, all siding, no masonry facade and the city gave the property to the developer and waived impact fees. That is the cheapest property I personally have ever seen built. 

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  • Charley C.
    North of Houston · Member since 2018 · 350 posts · 181 votes
    7y

    @Jeff Cantrell No pool,  no office, no amenities, just really nice apartments instead. Keep in mind, these are like Townhouses so may be my example is not the one you need to use as a primary example. If I had a group of equity partners, my model would not be the one you would want to copy.  

    I bought 5 acres and spent a fortune on the development (350-400k by the tome I am done) but at least its mostly all done, I can just show up once a year and build more. I planned it for 3 phases of construction. 3 year project. with each phase, the cost seems to go up. Doing it this way to manage soft cost.

    I know a lot of people in the apartment business and hearing what he says, I can tell you that @Jerry Mason has a more reliable sample of what you might want to figure on spending. He is echoing what I heard from others with first hand knowledge. 

    and before you say 113/ft (you are saying that not me), I said hard cost you still have to add soft cost,  a GC and his superintendents are not going to work for free. On second thought, you might want to say more than 130/ft 

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  • Jeff CantrellPro Member
    OP
    Rental Property Investor · Jackson, TN · Member since 2018 · 45 posts · 17 votes
    7y

    What are your rent rates on these properties?

    All things are relative so I’m curious. In my area, 750’ apartments (nice ones) go around $800-900/month, so $150/‘ to build would be out of the question, but construction costs are lower here too. Last house I built was 3100’ and ended up around $64/‘ not including property developement, with me as the GC after it was in the dry. (Long story). Retail is around $120’ right now for new construction for mid level homes in my area.

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  • Charley C.
    North of Houston · Member since 2018 · 350 posts · 181 votes
    7y

    Mine? its  limited market, hard to find renters but when i do, I got them for a while, : close to $1100 for 750 sf but again, these units or not typical; like they are separated by thick sound walls and no one living on top. Then the finish is like a million dollar custom home. I am glad I only built 20, got them all 100% leased but if I built too many more, I am not so sure I would be 100% occupied. What I did worked but its not a deep market to say the least. 

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  • Jerry Mason
    Member since 2019 · 3 posts · 7 votes
    7y

    Rates on what I’m presently working on, and it has been consistent for the last 5 years in DFW, is $1.00 per sq ft of livable space. 

    Current project is 38 mil, all in. About 350,000 sq ft, 3 story, no elevators, 267 units, garden style, 6 buildings (club, office and amenities area is 1/3 of the lower floor of the first building), onsite detention pond of 1/2 acre, 8 acre site, 1 decel lane added. 

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