FFE as Price per Square Foot?

[Jon Crosby]

Greetings Everyone! I'm working on a 'side project' related to an STR investment calculator. After getting some great feedback, I realized I did not have FFE (Furniture, Fixtures and Equipment) built into the acquisition cost. I would like to use some type of base metric to start with using either # of bedrooms or square feet to estimate FFE costs for any given property.

I'm completely aware that each property is different and going to bring it's own FFE dynamic to the cost, but does anyone know of or have a good starting point to work from that might work based on # of bedrooms or total square feet?  

Thank you in advance for any guidance you might be able to offer!

Cheers!

~Jon

[Paul Sandhu]

@Jon Crosby

I have furnished 22 STR's with 82 beds. 95% of the furnishings I buy at estate auctions. A good rule of thumb is that a major appliance (fridge, stove, washer/dryer) can be bought for $125. A bed, frame, dresser and night stand should be under $200. A living room or dining room should not cost more than $200 to furnish. You'll also need sheets, utensils, towels, etc.

So there here is your formula:

FFE = [($500 + R x $200) x 1.10] x P

$500 is your 4 appliances.

R is your total rooms you are furnishing.

$200 is the cost per room.

1.10 is a 10% adjustment factor for purchasing small things.

P is a premium factor for items, e.g. luxury sheets, pillow top mattress, etc.  P is between 1.0 and 1.5.