How Construction Estimates Change from Design to Construction

Your construction budget keeps changing as design progresses because early numbers rest on assumptions, and each phase replaces assumptions with real quantities, systems and market prices. Contingency is drawn down along the way, and owner decisions and escalation (about 1% per quarter in 2026, per RLB) push the number up or down.

Understanding how construction estimates change is the best defense against surprise. This article, part of the construction cost estimating series, tracks the estimate from concept through construction and shows what moves cost at each step.

Why do estimates change at all?

An estimate is a forecast built from the information available. Early on, that information is a program, a site and a building type. The estimator fills the gaps with historical cost per square foot or per unit of capacity. As the architect and engineers add detail, the estimator can count and price actual elements.

The result is movement in both directions. Some assumptions prove too low, such as a structural system that needs deeper foundations. Others prove too high, such as a mechanical allowance that the final design beats. The question for an owner is not whether the number moves but whether the movement is explainable and within the contingency you carry.

The types of construction estimates article explains the estimating methods that apply at each stage.

What changes at each phase?

The table summarizes the pattern. The accuracy bands are drawn from secondary sources and are rules of thumb; the design contingency ranges are from AIA and study guides as cited.

The bands come from RSMeans and Gordian course material cited through a secondary source. They exclude unforeseen scope additions, so a growing program can break through them.

How does design contingency shrink as design completes?

Design contingency is money held because the design is not finished. AIA says it is usually 5-10% of overall construction cost and is added to the budget rather than created by cutting it. Its guidance on managing the contingency allowance describes the planned usage of the original design contingency: about 20% in schematic design, about 30% in design development and 50% or less in construction documents.

Study guides and practitioner sources give phase-based percentages of the budget as well, though they are not official standards. One set shows about 10-15% at schematic design, 5-10% at design development, 2-5% at construction documents and none at bid documents. ConstructConnect offers 3-5% for complete, coordinated documents, 5-10% for schematic or design development and 10-15% or more for renovation or major unknowns.

The ranges are not directly comparable, because they use different bases. See the construction contingency percentage guide for how to choose one for your project.

Sample contract language shows the practice: design contingency is reduced at design development approval and again at the 50% and 90% construction document estimates, according to clause samples from Law Insider.

What typically drives cost up between estimates?

Owners are most often surprised by four things.

• Scope growth. Added program, bigger rooms or upgraded finishes. This is the largest controllable driver.
• Design development detail. Mechanical, electrical and structural systems get fuller as engineers coordinate, and they often cost more than a square-foot assumption.
• Escalation. The Turner Building Cost Index rose 1.44% in a single quarter, Q1 to Q2 2026, and 5.15% year over year. Over a 12-month design period, market movement alone can be several percent.
• Value-engineering lag. Cuts made to rescue a budget take time and sometimes cost design fees to implement.

Escalation drivers in 2026 include data centers, semiconductors and advanced manufacturing demand, and a shortage of skilled mechanical and electrical labor, per Turner's Q2 2026 reporting.

What does a revision look like in numbers?

Illustrative example: a 40,000 SF two-story medical office building in Phoenix. These are assumed numbers to show the arithmetic, not market data.

Here the base estimate rises from $14,000,000 to $16,100,000, a 15% increase, while contingency falls from $1,680,000 to $322,000. If the owner tracked only the base, the budget "grew by $2,100,000." If the owner tracked total with contingency, the growth is $742,000 (from $15,680,000 to $16,422,000). Both views are accurate, but the second matches how contingency is designed to work: it funds the growth.

Assume in this example that $900,000 of the base increase came from owner-requested program additions and $1,200,000 from design detail and escalation. Splitting the reasons is the useful move.

How should owners control the change?

1. Track estimates in a consistent format. Summarize each estimate in CSI MasterFormat divisions or UNIFORMAT systems so comparisons are line by line. ASTM E1804 supports this approach.
2. Get an independent estimate at each milestone. A City of Greenville, NC solicitation called for an independent estimate at 100% schematic design, 100% design development, 60% construction documents and 100% construction documents, reconciled line by line with the designer's. The estimate ownership article covers this.
3. Explain every change. Classify each movement as scope, design detail, market or error.
4. Set decision deadlines. Late owner decisions create redesign and cost.
5. Hold a gate. If the estimate exceeds budget at the end of a phase, resolve the gap before the next phase starts, rather than carrying it forward.

The estimate vs budget vs contract value article explains why even a reconciled estimate does not equal the final price.

Why are renovation estimates more volatile than new construction?

Renovation and adaptive reuse projects hide information behind existing walls, floors and ceilings. ConstructConnect puts contingency for projects with major unknowns at 10-15% or more, compared with 3-5% for complete, coordinated documents. The reason is simple: until crews open the building, the estimator is pricing a guess about what is there.

You can narrow the range before design is complete by paying for investigation early. Selective demolition, core samples, hazardous-material surveys and utility locating cost money, but they convert unknowns into quantities. An owner who funds this work at schematic design usually sees smaller swings at construction documents than one who waits.

Phase gates matter most here. If the building's condition forces a structural fix, you want to learn it while the design can still adapt, not during construction when each change order carries markup and schedule effects.

How do you read a changing estimate without panic?

Treat each estimate as a status report. Three questions give you a quick read.

• Is the movement inside the contingency? If the base rose by less than the contingency fell, the total is stable.
• Is the reason scope or price? Scope movement is yours to decide; price movement is the market's.
• Is the trend steady? Several estimates in a row creeping up by a similar amount point to a systematic gap, such as a missing system or an underpriced quality level.

Ask your estimator to show the three answers on one page each time. That page is more valuable than the detailed pricing.

What happens after the contract is signed?

Estimates stop changing at the contract but costs do not. A guaranteed maximum price or lump sum fixes the price for defined scope. Allowances, unknown conditions and owner-requested changes still adjust it by change order. Keep an owner contingency for these. AIA says most errors and omissions amount to less than 5% of a project's budget, a useful anchor for sizing the reserve.

One caveat: the accuracy bands and contingency percentages in this article are rules of thumb from secondary sources. Costs vary by market and time, so decisions should rest on a project-specific estimate.