Value Engineering
"Value Engineering": In simple terms, value engineering in real estate involves designing/engineering buildings to be constructed in a more cost-effective way to achieve the desired end result.
I can only speak in terms of designing apartments and houses.
When I am value engineering our projects, I ask my subcontractors in Concrete, Framing, Mechanical, Electrical, and Plumbing and ask them to imagine they are designing their project, and I ask them if there are ways to accomplish this in a less expensive manner without compromising quality.
For instance, they might discover a less expensive HVAC system that still meets their needs, or they could simplify electrical or plumbing layouts to reduce installation costs (substituting copper for CPVC piping, copper is more expensive and more likely to get stolen during construction)
Some other considerations for cost-effective design include:
Using standard-sized windows, especially for the sides and back of the building.
Opting for standard-size doors.
Selecting the most effective facade from options like Stucco, Siding, Fancy European Siding, or Steel Siding, Brick, Stone, Wood, Glass, etc. Our infill lots, we use expensive facade on the front on the project and 15ft on the sides, the rest we would do in stucco.
When using hardwood, considering substituting for cheaper materials Ex: IPE can be switched for Kayu Batu which is roughly 1/2 the price and looks the same.
Minimizing non-rentable space, such as eliminating the need for 7 ft wide hallways and keeping them at 5-6ft (we've done 4ft and it's too tight when moving furniture)
Crafting layouts with optimally sized units, which can be subjective and dependent on the market.
It's important to emphasize that the goal of value engineering is not merely to reduce costs but rather to find more cost-effective ways to achieve the same result while maintaining quality.