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News & opinion

6 DEC 2018

Benchmarking is crucial to informed decision-making

Owners operating portfolios at an international level need to accurately compare projects, as the growing construction industry only becomes more significant.

An inherent challenge and risk with cost benchmarking analysis is inconsistency when comparing multiple projects. Inconsistencies can arise in many ways, including:

  • Contrasting work breakdown structures
  • Scope of work inclusions and exclusions
  • Differing construction methodologies
  • Existing site conditions and delivery models

Due to the inherent scope variables, no two projects are the same. With the globalization of construction and owners operating at an increasingly international level, the need to accurately compare projects at both the regional and international level is growing and will become more significant.

Many benchmarking efforts lack the ability to provide meaningful, comparative analysis due to inconsistencies and the lack of transparency in the raw data. In CBRE's most recent North Americas Fit-Out Cost Guide, cost data was harnessed directly from our project management technology system, Kahua. Access to raw data at the source is crucial for ensuring data integrity and accuracy, confidence in that data drives accurate analysis.

The International Construction Measurement Standards (ICMS) support a methodology of consistently comparing construction projects against each other and is the first global initiative of its kind. ICMS is a framework for classifying, analyzing, and presenting project costs at the regional, national, and international level.

ICMS is not a detailed method of measurement – it's a high-level standard for benchmarking and cost reporting. The aim of ICMS is to provide global consistency in the way that project costs are compared, and to generate accurate data to inform improved decision-making.

CBRE's Cost Consultancy practice is excited to partner with and promote ICMS alongside RICS throughout the corporate real estate and construction industries. CBRE supports clients of all sizes, sectors, and project types. Leveraging Kahua, we plan to incorporate ICMS breakdown in our data to provide a level of benchmarking consistent with the industry. This process will enable better decision-making in deploying capital successfully.

As an RICS-regulated practice, CBRE looks forward to collaborating further with RICS and serving our clients with exceptional outcomes.

More information on CBRE's Cost Consultancy practice is available on their website, where you can also access the latest Fit-Out Cost Guides

Chris Smith MRICS

About the author

Chris Smith MRICS | Practice Leader | CBRE Cost Consultancy North America

Chris Smith heads CBRE’s North Americas Cost Consultancy business, leading a team of cost managers providing expert cost advice and commercial management to clients across all sectors. With experience in both the contracting and consulting sides, Chris’ project experience includes the Royal London Hospital in London, the Argyle Diamond Mine in Western Australia, and several high-profile office developments and data centers across North America. Holds a Bachelor’s Degree in Commercial Management and Quantity Surveying from Loughborough University (UK), and has been an MRICS-accredited member since 2010.