FICM - 5.5.2 Estimated Replacement Cost

5.5.2 Estimated Replacement Cost

Definition. The estimated cost to replace the building at the time of inventory.
Basis for Calculation. The cost to replace the building’s gross floor area at current construction costs in accordance with current building and public safety codes, and standard construction methods. The Engineering News Record, R.S. Means,⁶ or Whitestone Research,⁷ or replacement value shown on the building’s insurance policy are examples of frequently used sources of information for determining construction cost indices. The selected source of information should be locally determined. The replacement cost of fixed equipment in the building should be included.

⁶ R.S. Means Company, Inc., Construction Consultants and Publishers, publishes an historical cost index. In addition, the Commercial/Industrial/Institutional section of one of the Means manuals contains base building costs per square foot or floor area for 70 model buildings.
⁷ The Whitestone Research organization specializes in applied economic research and software development for both public sector and corporate clients. Whitestone also publishes focused technical reports and software products.