Construction Loans > Commercial Financing and Understanding the Hard Costs of a Commercial Construction Project

Commercial Financing and Understanding the Hard Costs of a Commercial Construction Project

Hard Costs Are the Brick and Mortar Expenses

The total cost of a commercial construction project includes the land cost, the hard costs, the soft costs, and the contingency reserve, which should be about 5% of hard and soft costs.

But what does the term "hard costs" mean? Included in hard costs are all of the costs for the visible improvements, line items like grading, excavation, concrete, framing, electrical, carpentry, roofing, and landscaping . Another way to describe hard costs are the "brick and mortar" expenses.

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