How lucrative is it to own an apartment complex?
Feb 22, 2021 · A twelve unit apartment complex Utilizing mid-range materials, a regular foundation with full basement, efficient doors and windows, all appliances, and "turnkey" finishing would run at an average of $64,575 to $86,100 per unit …
How much can you make owning an apartment complex?
Dec 11, 2021 · What Is the Average Cost to Build an Apartment Complex? As of 2020, the average cost to build an apartment building in the United States was around $22 million, but that figure varies widely depending on location, type of building, construction costs, number of apartment units, square feet per apartment, and more.
What is the average lifespan of an apartment complex building?
The national average, according to Fixr.com, is about $64,500 to over $86,000 per unit. This price range has the following specifications: A unit 861-square feet with a footprint of 24’x35’ (the size of an average apartment) Use of mid-range materials An apartment with a normal foundation and a …
How much does it cost to build a small apartment?
Dec 29, 2016 · Considering the cost of an entire building complex, the figures could range from $856,800 to $4,032,000, with $2,318,400 being the average figure. This does not include land acquisition costs.
What factors are considered when determining the cost of commercial apartments?
When it comes to determining the cost of commercial apartments, many factors must be taken into consideration, including building practices, the cost of labor, the cost of land, and to some extent, the cost of the materials.
What is a change order in real estate?
A ‘change order’ refers to when something is chosen that is outside the contract.
How much does it cost to build an apartment?
Average apartment building construction costs in the United States range from $4.5 million to $50 million. Project costs vary most dramatically based on the size of the completed project .
What are the factors that contribute to the cost of an apartment complex?
The major factors contributing to the budget are the costs of land, contractor’s fees, architect’s fees, and materials costs.
What are soft costs?
Soft Costs. Soft costs are less obvious expenditures that are just as important if you want a habitable building. These include things like architectural fees, legal fees, and permit and development fees. Projects encounter additional soft costs if there are rezoning issues or community opposition to the development.
What is waste in the form of square footage that does not produce income?
When projecting the cost, remember that waste in the form of square footage that does not produce income is an inevitable result of building multifamily housing. This is particularly important when evaluating cost per square foot rather than per unit. Hallways, lobbies, elevators, mail areas, gyms, and staff space all factor into the cost of a building—but they do not generate rent revenue. These spaces typically account for 10 to 15 percent of the project’s cost.
What is a contractor?
The contractor manages the day-to-day needs of the project, hires and coordinates subcontractors, sources materials, and obtains the necessary permits. The project contractor acts as the owner’s feet on the ground and as an advisor to recommend ways to stay on budget and on deadline.
Do construction materials need a budget?
Even in the best of times, construction materials require a healthy budget. The increased cost of materials is far from a new phenomenon and has been a watch point for those in the industry for several years. However, the last six months put it on the general public’s radar and created a tipping point in the industry.
How much does it cost to build an apartment?
So, how much does it cost to build an apartment? The national average, according to Fixr.com, is about $64,500 to over $86,000 per unit. This price range has the following specifications:
How to save money in the future?
Some of the tips that will help you save money in the future include: Install low-flow toilets, faucets, and shower heads to cut down on your water bill. Opt for a programmable thermostat to reduce your apartment’s heating bill. Install energy-saving bulbs to reduce your electrical bill.
What happens if you don't have a debt?
Here are some scenarios: If you don’t have a debt, your personal income will be the remaining amount after you pay the operational expenses. Of course, the money going in is from the rents of your tenants. If you have a mortgage, you can only calculate your returns after you’ve paid it.
Can building an apartment hurt you?
Building an apartment can be a painstaking project. It can hurt your schedule and your wallet. However, there’s no way a few incon veniences will stop you. Especially if you’re determined to make your dream multi-family housing unit a reality.
How many square feet are in an apartment?
According to the U.S. Energy Information Administration, the standard size of an apartment unit is 861 square feet with a footprint of 24 feet by 35 feet (24×35).
What does it mean to go green?
But nowadays, the idea of going green means getting an Energy Star rating for the buildings comprised of eco-friendly materials. In other words, both government and private authorities are keen on granting tax rebates for homeowners whose properties are accredited with Energy Star or LEED rating.
Is owning an apartment complex profitable?
Investing in an apartment complex is one of the most time-tested ways to build wealth. In fact, multifamily investing has an incredible array of benefits, including cash flow, the ability to finance properties with a limited amount of money down, and incredible tax benefits (just to name a few).
How much does it cost to build a complex?
A twelve unit apartment complex Utilizing mid-range materials, a regular foundation with full basement, efficient doors and windows, all appliances, and “turnkey” finishing would run at an average of $64,575 to $86,100 per unit to complete, not including acquisition of land.
How much do apartment building owners make?
In our portfolio, we average around $100 to $150 profit per unit per month, depending upon what market the asset is located, and how much debt is on the asset. For example, a twenty-unit property should deliver around $2,000 per month in positive cash flow.
How much does it cost to build an apartment complex Australia?
An average high-rise apartment building costs about $US2,850 ($3,021) per square metre to build in Sydney, compared with $US2,000 in Auckland. A stock standard brick veneer home of 90-110 square metres will set you back anywhere from $825 per square metre in Adelaide, or $1,280 per square metre in Hobart.
How do apartment owners make money?
Profits on Sales Apartment buildings frequently get sold on the basis of their cap rate, which is effectively a multiple of the income they produce. If you increase your building’s income by raising rents or cutting expenses, you should be able to sell for a profit.
Is apartment rental a good business?
For those looking for a steady source of income with minimal time to spend, an apartment rental business is hard to beat. Despite everything, apartments normally do not go bankrupt like many small businesses. That is why they are a favorite investment for people who want minimal risk.
How much does it cost to build a 10 story building?
Office, 5-10 Story Square Foot Cost Assuming Face Brick with Concrete Block Back-up / R/Conc. Frame
How many square feet are apartments?
The U.S. Energy Information Administration reports that the average apartment is 861 square feet, which works out to a 24-foot by 35-foot space. Based on a building with 12 average-sized units, the national average for construction is about $125 per square foot. Some contractors, however, may charge as much as $200 per square foot depending on ...
How much does a contractor charge per square foot?
Some contractors, however, may charge as much as $200 per square foot depending on the work required and the rates of subcontractors. This project will require the assistance of an architect and a general contractor. The architect services will require about 10-15% of the total project budget, while contractors account for about $200,000 in fees ...
Is apartment building a DIY project?
Apartment building construction is never a DIY project due to the sheer scope of the work, as well as the building code requirements, the variety of jobs and work involved, and other complex aspects.
Is apartment construction a big undertaking?
Apartment construction has a number of different variables involved, so pricing this type of job can be difficult without specific details. A new construction project is a big undertaking, and it is important to know all the aspects involved to get the most accurate estimate.

Average Apartment Complex Costs
A Note on Cost by Square Footage
- When projecting the cost, remember that waste in the form of square footage that does not produce income is an inevitable result of building multifamily housing. This is particularly important when evaluating cost per square foot rather than per unit. Hallways, lobbies, elevators, mail areas, gyms, and staff space all factor into the cost of a building—but they do not generate …
Apartment Building Cost Factors
- While the national averages give us some hard numbers, whether a project comes in at the low or high end of that data set makes a great deal of difference to the financial needs of a project. As such, owners and developers can pursue a more tailored cost estimate for a project to gauge their own interest and to begin crafting the project. Ultimately, the project architect prepares a tailore…
Construction Costs
- As one might expect, construction costs create a great deal of the cost of building an apartment complex. The national average for construction costs alone ranges from $64,500 to $86,000 for the average-sized unit, which is 861 square feet. That average is far from the final bill. It only covers the hard costs for supplies and the labor to build th...
Contractor Fees
- Within the construction budget is a particular item worth noting: the contractor fees. A good general contractor serves as the oil for the entire project, ensuring all the moving pieces coordinate smoothly. The contractor manages the day-to-day needs of the project, hires and coordinates subcontractors, sources materials, and obtains the necessary permits. The project …
Architect Fees
- Architects provide the bones for the new development, and their fees account for 10 to 17 percent of the project’s cost. The architectural firm does much more than pass over a set of blueprints. From the architect, the owner gets the budget, work list, and work plan. The firm also ensures that the building plan will satisfy regulatory requirements, works with structural engineers, and will ne…
Final Thoughts
- Just as building an apartment complex is a significant undertaking, so too is accurately determining the cost of the building. The major factors contributing to the budget are the costs of land, contractor’s fees, architect’s fees, and materials costs. The scale, technicality, and liability of building an apartment complex remove it from the realm of DIY. Hiring a good team with the gen…