Owner Project Costs

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The GC’s GMP covers construction cost — what it takes to build the facility. The owner’s total capital investment includes a second category of costs that never appear in the GMP: design fees if not sub’d to the GC, land, owner’s project team, regulatory compliance, technology, equipment the GC doesn’t install, and startup. These are Owner Project Costs (OPC).

On a well-run capital project, OPC is scoped and budgeted at FEL-1 alongside TIC. On a poorly run one, it surfaces as a series of late surprises after the GMP is signed.

TIC is what the contractor delivers. TIC + OPC is what the owner spends. The difference commonly runs 20–40% of TIC. Budget both from the start.

Total Project Investment Framework

Total Project Investment
  ├── TIC (Total Installed Cost)
  │     └── What the GC's GMP covers (see [Pricing and Cost Assembly](./pricing-and-cost-assembly))
  ├── Owner Project Costs (OPC)
  │     ├── Pre-construction costs
  │     ├── Owner's project team
  │     ├── Design (if not in GMP)
  │     ├── Owner-furnished equipment (OFOI)
  │     ├── Technology and systems
  │     ├── Regulatory and compliance
  │     ├── Commissioning and startup
  │     └── Post-construction costs
  └── Total Project Investment

OPC Categories — Detailed Breakdown

Pre-Construction

Item	Description	Typical Cost Range
Land acquisition	Purchase price + closing costs + transfer taxes	Market-driven
Environmental assessment	Phase I ESA ($3,000–$6,000); Phase II if needed ($15,000–$80,000)	$3,000–$80,000
Geotechnical investigation	Borings, lab testing, report	$15,000–$60,000
Site survey and title	ALTA survey, boundary survey	$5,000–$25,000
Utility availability studies	Power, gas, water, sewer capacity confirmation from utilities	$5,000–$30,000
Feasibility studies	Traffic, environmental, market	$20,000–$150,000
Incentive / economic development	Legal fees, application prep for tax abatements, TIF, grants	$10,000–$75,000
Zoning and entitlements	Attorney fees, filing fees, public hearings	$10,000–$100,000

Design Fees (if not subcontracted to GC)

In design-bid-build or when the owner retains their own A/E firm, design fees are an OPC:

Service	Typical Fee (% of construction cost)
Architecture + engineering (full services)	5–12%
Process engineering only	2–5%
Civil / site engineering only	1–3%
Specialty consulting (food safety, structural peer review)	0.5–2%

In design-build, the A/E is typically a sub to the GC and the design fee is in the GMP. Confirm this explicitly — it is the most common source of confusion in D-B OPC accounting.

Owner’s Project Team

Every capital project requires owner staff or consultants to manage it. These costs are real and should be in the budget.

Role	Typical Cost Basis
Owner’s Project Manager	Salary + benefits for duration; or $100–$250/hr for contract PM
Owner’s Construction Representative (field)	Salary or $75–$175/hr
Food safety / QA lead (for F&B, CPG, pharma)	Salary or $85–$175/hr
Procurement manager (for OFOI equipment)	Salary or $85–$150/hr
IT/OT integration lead	$100–$200/hr for specialist
Legal (contract review, change order disputes)	$250–$500/hr

Rule of thumb: Owner’s project team costs run 2–5% of TIC on a well-staffed capital project. Understaffing the owner’s team is a leading cause of scope growth and change orders — the owner can’t make decisions fast enough, and the contractor waits.

Owner-Furnished Equipment (OFOI)

Equipment the owner purchases and has installed by their own forces or OEM:

Item	Notes
Production equipment (OFOI)	Owner contracts directly with OEM; GC only prepares space (pads, rough-ins)
Specialty process equipment	Vendor-supplied with proprietary installation team
IT/OT servers and networking	Owner’s IT contracts separately
Security systems (CCTV, access control)	Frequently owner-furnished even if GC installs conduit
Lab equipment	Always owner-purchased; GC provides lab casework and utilities only

OFOI equipment cost is entirely outside the GMP. Always document the scope split at FEL-2 to avoid double-counting or gaps.

Technology and Systems

| System | Description | Typical Cost Range | |---|---| | Manufacturing Execution System (MES) | Production scheduling, tracking, quality management integration | $200,000–$2,000,000+ | | Plant historian / SCADA | Real-time data collection from PLCs and sensors | $50,000–$500,000 | | ERP integration | SAP, Oracle, or similar; interface to shop floor | $100,000–$1,000,000 (project-specific) | | LIMS (Laboratory Information Management) | For QC labs | $50,000–$300,000 | | Network infrastructure | Switches, cabling, wireless APs, cybersecurity | $0.50–$3.00/SF of facility | | Physical security (cameras, access control) | $2.00–$6.00/SF |

Technology costs are frequently omitted from early-stage project budgets because they are managed by IT departments separate from capital projects. Include them or flag the exclusion explicitly.

Regulatory and Compliance Costs

| Item | Description | Cost Range | |---|---| | Permitting fees | Building permit, fire, mechanical, electrical, plumbing | 0.5–1.5% of construction cost (jurisdiction-dependent) | | Plan review fees | Separate from permit fees in some jurisdictions | $5,000–$50,000 | | Third-party special inspections | Concrete, steel, soils — required by IBC for many project types | $20,000–$100,000 | | Commissioning agent (third-party) | Independent verification of systems | 0.5–2% of MEP cost | | Factory acceptance testing (FAT) | Travel to vendor site; per diem; testing labor | $5,000–$50,000 per major equipment item |

Furniture, Fixtures, and Equipment (FF&E)

Office and non-production facility items typically excluded from construction GMP:

Office furniture, workstations, lockers
Break room equipment (refrigerators, microwaves, vending)
Safety equipment (fire extinguishers, AEDs, first aid stations)
Signage and graphics

Rule of thumb: $10–$30/SF of office and support space for FF&E.

Financing Costs

For owner-financed projects (construction loan):

Construction loan interest: Balance × interest rate × construction duration. On a $20M project at 7.5% over 18 months: ~$1,900,000 in interest carry
Loan origination and fees: 0.5–2% of loan amount
Owner’s insurance during construction: Builder’s risk is typically GC-provided (in GMP); owner may carry additional coverage

F&B and CPG — Owner Project Costs

F&B and CPG projects have specific OPC categories that are frequently omitted from early budgets.

Regulatory and Food Safety OPC

Item	Timing	Cost Range
USDA FSIS pre-operational review	Pre-opening	$5,000–$25,000 owner prep cost
FDA facility registration	Pre-first-shipment	Minimal; administrative only
FSMA Preventive Controls consultant	Pre-opening to implement HARPC/HACCP	$15,000–$50,000
Third-party food safety certification (SQF, BRC, FSSC 22000)	Within 60–90 days of opening	$5,000–$20,000 initial; annual thereafter
Environmental monitoring program setup	Pre-opening	$5,000–$15,000 in lab contracts and equipment
Wastewater permit (if pre-treatment required)	Pre-construction through opening	$5,000–$50,000

Production and Startup OPC

Item	Description	Cost Range
CIP commissioning specialist	Verify CIP circuits, flow velocities, temperatures	$10,000–$40,000
Temperature mapping	Refrigerated/frozen spaces before first food storage	$5,000–$25,000 per space
Compressed air food-grade testing	ISO 8573-1 verification	$2,000–$8,000
Startup product waste	Product destroyed or held during first production runs	2–5 production days of output value
Trial production runs	Staffing, utilities, consumables for pre-production runs	$20,000–$200,000
Operator hiring and training lead time	Operators hired and trained before production; no revenue	4–12 weeks of labor cost

Technology OPC Specific to F&B/CPG

System	Notes
Traceability system	Lot tracking from raw material to finished goods; FDA/FSMA requirement
Label compliance software	Nutritional data, allergen labeling, regulatory label review
HACCP/food safety documentation software	Recipe management, HACCP records, audit trails
Cold chain monitoring	Real-time temperature monitoring with alert/logging for FDA compliance
ERP / production planning integration	SAP, Oracle, or mid-market ERP for production scheduling and inventory

Assembling the Total Project Investment Budget

Present to the owner at FEL-1 with explicit uncertainty ranges. Do not combine TIC and OPC into a single number — keep them as separate line items so the owner understands what they are buying:

FEL-1 Total Project Investment — [Project Name]
Pricing date: Q[N] YYYY | Estimate class: Class 5

TIC (Construction)                    $XX,000,000      (−30% / +50% accuracy)
  └── Escalation allowance            included

Owner Project Costs (OPC):
  Pre-construction / land             $X,000,000
  Design fees (if owner-retained)     $X,000,000
  Owner project team                  $X,000,000
  OFOI equipment                      $X,000,000       ← confirm scope split
  Technology / IT                     $X,000,000
  Regulatory / compliance             $X,000,000
  Commissioning and startup           $X,000,000
  FF&E                                $X,000,000
  Financing costs                     $X,000,000
  OPC Subtotal                        $XX,000,000

Owner Contingency (management reserve) $X,000,000     (separate from GMP contingency)

TOTAL PROJECT INVESTMENT              $XX,000,000

OPC as % of TIC (industry benchmarks):

Project Type	OPC as % of TIC
Basic light industrial	10–18%
CPG / food processing	18–28%
Food processing with significant OFOI equipment	25–40%
Highly regulated (pharma, sterile food)	30–50%+

Common OPC Omissions to Flag at Every FEL Review

At each phase gate, check whether these items are in the budget:

Owner’s project management team cost (duration × loaded rate)
Technology/IT systems explicitly scoped or explicitly excluded
OFOI equipment list confirmed and priced (or excluded with owner acknowledgment)
Regulatory filing fees and compliance consultant for this specific facility type
Commissioning and startup budget as a named line item
Startup product waste budget (for process manufacturing)
Training cost for new operations staff before first production
Financing cost if project is debt-financed

Pricing and Cost Assembly — the GMP side of total project investment
Commissioning and Startup — startup costs that are the largest OPC variable
Closeout and Lessons Learned — OPC actuals feed the historical cost library
GMP Contingency Structure — owner contingency (management reserve) lives here
Food and Beverage — F&B regulatory OPC
Light Industrial and CPG — CPG scope split and OFOI documentation