Allocating a budget for your veterinary build out can be challenging. Depending on the scope of the build out, pricing can vary dramatically. Veterinary construction is an expensive process, yet a new build out can bolster the number of services you offer as well as increase your overall revenue. How should you get started budgeting costs for your veterinary build out?
In this blog, we examine the costs that can emerge for a veterinary build out. This blog does not address constructing a new veterinary practice from the ground up, and thus will not address costs associated to the land, such as the purchasing price and the associated legal fees, environmental studies, or zoning applications.
Budgeting Costs for Your Veterinary Build Out
Before considering the costs for a veterinary build out, it can be helpful to distinguish between “soft costs” and “hard costs”. Soft costs cover the intangibles like fees associated with insurance, financing, permitting, licenses, etc. Hard costs are everything associated with the building and are a bit more tangible, like construction or equipment costs.
Financing Costs
Vet construction projects are considerably more expensive than a typical commercial build out – in scope, they are comparable to that of a dentist office or a small healthcare facility. Thus, establishing and sticking to a budget early on is vital to the success of your project. This will ultimately determine the scope and scale of what you can and can’t do, so it is important that this is established to avoid going over budget.
According to Vetfolio, it is best not to borrow money that exceeds one year’s gross billing. To get a rough estimate of what you can budget for, it is best to speak to both banks as well as veterinary-specific lenders.
Once a budget has been established, you can expect several financing costs to emerge, such as the processing and origination fees, as well as interest-only payments.
Building Costs
How much will it cost to actually complete the build out in question? Building costs will constitute the majority of spending for your veterinary build out. This encompasses everything from structural, electric, HVAC, plumbing, and possibly architectural costs.
Building costs are usually measured in price-per-square foot of the building area. This number varies depending on where you are located – a build out in an urban center will likely be more expensive than one in a rural area, and may also be influenced by local laws and requirements.
The best way to prepare for your veterinary build out is to get in touch with a contractor before starting on detailed permit drawings. From a basic schematic, a contractor can help you understand the costs of your construction project.
Equipment and Furnishings
Furnishings, fittings, and equipment account for everything that is held inside of a veterinary practice. While in the grand scheme of things furniture may be less expensive, equipment like tubs, tables, surgery lights, x-rays, and other specialized equipment can be significant in their expense.
Some furnishing costs may be stretched over time. For instance, if you are building out a new x-ray space, you can start with that, rather than buying new furniture for the lobby at the same time. Keep a finger on the pulse of your budget, and make decisions accordingly.
Preparing for Contingencies
With any project, you should plan for the unexpected. Scope creep can often factor into veterinary build outs, particularly when contractors don’t have experience with your type of project.
Generally, contingency costs should factor about 5% of your budget. Contingency costs can be influenced by the contractor you are using – if they are not experienced at build outs, you may want to budget contingency costs at up to 25% of your budget to ensure that you are able to stay within scope.
Buildout Pros excels at build outs for projects adjacent to the health and dental industry, including veterinary hospitals. We understand the specific rules and regulations around these types of projects, ensuring that you stay within budget and get results that benefit your bottom line, your veterinary staff, and the pets and people they serve.
Contact us today for more information about our services.