The Differences Between Ground Up Construction & Renovation

GROUND UP CONSTRUCTION AND RENOVATION

The Differences Between Ground Up Construction & Renovation

The Differences Between Ground Up Construction & Renovation 2240 1260 Majid Riahi

Long-term success in commercial ground up construction depends on a range of important choices, especially for the most profit-driven of commercial construction companies (as all good ones are). Some of these choices may appear small and relatively insignificant; others will be big and—in all honesty—so significant as to be intimidating. Few choices, however, are as large,  as important or as worry-inducing as the choice between ground up construction and renovation. It’s a major decision, one that could make or break a property investment. That’s why we’re here to guide you through the ups and downs of both options.

Ground Up Construction and Renovation – What’s the Difference?

It’s pretty simple. Whereas one—renovation—involves reworking, redesigning and remodeling an existing property, the other—ground up construction—instead involves creating an all-new property from scratch. That means potentially knocking down an existing property, laying all-new foundations, handling the brickwork, erecting scaffolding as well as a million-and-one other jobs, big and small. It’s the whole shebang, and even with the much-needed help of building contractors it’s a lot of work. So why would anyone be interested in it?

Ground Up Construction Advantages

While you’ll always be restricted to some extent by safety laws, local building standards and other buildings regulations, ground up construction offers dramatically more freedom than renovation. Budget permitting, ground up construction lets you construct a property exactly how you envision it. If you’re looking to build a property for a specific purpose, particularly a niche one, this can save you from a myriad of future expenses as well as make your property stand out to those niche buyers (who are likely willing to pay above market average).

For an example of how ground up construction can save you money as a Landlord, look to the potential cost of tenant improvement allowances. This is a pre-arranged sum you will need to provide to your tenant (typically for a business location) in order to cover the cost of renovation and of making the property suitable for their needs or the needs of their business. By building a property from the ground up with a certain set of needs in mind, you can mitigate those tenant improvement costs and get business owners flocking to your property!

Finally, ground up construction gives you the ability to outfit your property with the latest cost-saving, energy-efficient innovations. Often, these are too much of a hassle to implement in renovations, yet they stand to increase the price and attractiveness of even a basic property.

Renovation Advantages 

Of course, renovating an existing property comes with its share of advantages too. For one, it’s significantly less intensive in terms of labor, cost and time. With an existing property, most—if not all—of the essential components will already be in place: from the foundation to the electrics, it’s all there and ready to go.

Additionally, the reduced cost and risk of renovations mean that it’s far easier to get funding from property development financiers. The more ambitious a commercial construction project is, the greater the risk of failure. With a renovation project, especially one with thorough planning behind it, there’s little risk (relatively speaking) in the eyes of lenders, and so they’ll be far more willing to lend you the cash you need.

Ground Up Construction Disadvantages

Bureaucracy can be a pain, but it’s a fact of life, and in construction it exists primarily for our safety. Unfortunately for you, if you opt for a ground up construction project, it also means that you’ll need to acquire discrete permits for each facet of the construction process. Building, paving, landscaping, electrical, plumbing and more. You’ll need to acquire a permit for all of these before you can go ahead with construction. This can lead weeks, possibly months of tedious waiting and may seriously extend the timeline of your commercial construction project. And if you’re looking to demolish an existing property before you go ahead with a new-build? Well, you’ll need to acquire a demolition permit too.

Luckily, like all good commercial construction companies, we’re happy to handle the acquisition of all necessary permits. All you need to do is sit back and relax, safe in the knowledge that Substrata has things covered. 

Renovation Disadvantages 

It may be quicker and cheaper, but renovating an existing property isn’t always a sunny walk in the park; if you aren’t careful, thunderclouds can start forming overhead shockingly quickly. Existing properties, particularly if they’re old, can be hiding an array of unexpected surprises (and not the nice kind). Lead, asbestos, termites, mold and more could be waiting behind any given wall or in any ceiling cavity. If you encounter any of these when taking to your property with hammers and picks, prepare to face significant costs and lengthy project delays.

With renovations, you’re also constrained by the limits of the property’s existing structure. You may be able to knock down walls, rewire and re-plumb (at cost), but you can never match the creative freedom and flexibility that comes with ground up construction.

Conclusion 

This isn’t what you’ll want to hear, but when it comes to the choice between renovation and ground up construction, there is no single right answer; there is only what’s right for you. You’ll need to weigh up your circumstances, financial situation, available time and your ability to accommodate for unforeseen circumstances (very important).

Ground up constructions require much more time, effort and dedication (your building contractors will be your best friends by the end of it), but they’re also an order of magnitude more flexible and potentially more lucrative to boot. Renovations, on the other hand, are more restrictive, but they’re also generally quicker and cheaper (barring any serious unexpected setbacks).

If you’re unsure which is right for you, get in touch! We’ll be happy to speak with you about your specific needs.

18 Comments
  • I appreciated it when you shared that it is important to weigh the differences between ground-up construction and renovation when it comes to changing the appearance of your commercial building. It is important to consult with a reliable contractor who is more knowledgeable in the area. I would like to think if a business owner wants to improve the look of his premise, he should consider working with a reliable commercial contractor.

  • My friend wants to get an office for his business. It makes sense that he might want to get an office that he can renovate! That way, he can change it to fit his needs.

  • Eli Richardson June 8, 2021 at 6:35 am

    It’s great that you talked about construction renovation and how it comes with cost-effective benefits. Recently, one of my uncles mentioned he’s interested in investing in a real estate project. My uncle said he’d need to renovate a few properties, so I think this article could interest him. Thanks for the advice on properties and their renovation and ground-up services.

  • I totally agree when you said that ground-up construction would really create the structure that the owner envisions. For those business owners with funds, it would be perfect to consider this type of commercial construction. It would reflect their brand and their company well if the structure is made depending on their style.

  • Great tip about assessing the replumbing issues and costs. My wife wants us to renovate the bathrooms and I don’t know how to do any of the plumbing. I’ll have to hire a contractor who has good online reviews.

  • Kristofer Van Wagner June 28, 2021 at 4:45 pm

    You made an excellent point that one of the advantages of building on an existing lot is that it is less intensive in terms of labor work and therefore, will be less costly. My brother mentioned that he is looking to have his dream house built and he has been scouring for available lots. I will advise him to look for lots that a readily available so that he does not need to spend extra money having the lot cleared.

  • Excellent writing! We can take away a lot of important information from this article. Keep sharing great posts.

  • Thanks for the tip to get permits before moving on with construction. I never even thought about getting a permit. I’ll see what I can do about getting the right ones now before I even meet with any construction workers.

  • Katherine Brown July 24, 2021 at 4:36 am

    Thanks, what an informative post! Everything we need to know are found in this article. We hope you keep posting quality articles.

  • I thought it was interesting when you explained that permits are required to demolish an existing property. It seems like demolition could be a risky project for people that aren’t experienced. If you need to destroy something, you should probably contact a demolition contractor.

  • I can see how a business could really benefit from getting the right kind of renovation for their building in order to have the space they need. Getting some help from a professional could allow them to be more effective with fewer problems. It was interesting to learn about how it can be easy to get money for renovations because there isn’t as much risk.

  • Thanks for pointing out that the contractors will be our best friends when we need a project done that requires much more time and effort. With that in mind, I can imagine how important it is to choose a good contractor to build slipform barrier walls. They have to really know the process to prevent any issues or mistakes in constructing those structures for their clients.

  • Kristofer Van Wagner August 5, 2021 at 2:13 pm

    It is wonderful that this post shared that when looking for commercial remodeling contractors, it is important that we ensure that they are experienced and qualified. My sister mentioned that she would like to have her office renovated. I will definitely help her look for a contractor who is aware of the regulations and requirements to get the renovation work done.

  • My cousin has been thinking about getting a construction company to work on her home in order to make it look better. She would really like to have the work done by a professional to make sure that it has higher quality. I liked what you said about how when the home is built from the ground up with a new foundation it can save them from future expenses.

  • LEED Access Doors and Panels August 19, 2021 at 4:57 am

    Ground-up construction refers to the process of putting up a new structure on a lot where no building exists. You are building from scratch. New foundations, new walls, new footings. On the other hand, a renovation refers to the modification of an existing structure. Thank you for giving us a direct and straight to the point answer! It greatly helped in clearing our confusion.

  • I like that you mentioned that renovation costs less and takes less time than ground-up construction. My wife is wanting to revamp her storefront and was thinking about tearing it down and starting over. I think I will tell her that renovations mean that her store will be open again sooner and will cost less.

  • It’s good to know that you need a permit to demolish. My husband is wanting to look into demolishing the pool in our backyard in a couple of weeks, but he was wondering if he would be able to do it on his own if he didn’t have a permit. We’ll have to look into hiring a professional demolition service to help us.

  • I can understand how a business could really benefit from getting the right kind of demolition in order to be safer. Making sure that they can work with a professional could allow them to be more effective with fewer problems. It was interesting to learn about how they could build it from the ground up which can save them a lot of money.