How Much Do Modular Buildings Cost?
How much do modular buildings cost? This is a question we hear so often from potential customers who are navigating modular building options for the first time. Every project and job site we work on is different, so pricing can vary widely. But, we understand that setting a budget and securing funding for your new building or building expansion is a top priority.
Whether you need a portable classroom, modular commercial building, or anything in between, use these general pricing guidelines to ensure that you have reserved the appropriate funds for your building project.
How Much Do Temporary Modular Buildings Cost?
Modular buildings range in size from a few hundred square feet to tens of thousands of square feet, so building size is an important factor in determining modular building costs. Type V-B (wood-frame construction) temporary modular buildings generally range from $50 to $100 per square foot. This price range does not including site work, delivery, or installation.
How Much Do Custom Modular Buildings Cost?
Custom modular buildings tend to have a much broader cost range, from $70 to $400+ per square foot. The level of customization, structure type, and complexity of a custom building project also drive the final price.
Factors that Affect Prefab Buildings Costs
Each modular building has its own set of specifications, so it is important to understand that these ranges are for a general frame of reference. Modular building costs beyond the initial building construction include:
- Site accessibility
- Excavation and grading
- Soil compaction
- Stormwater management
- Location of water, sewer, and utilities
- Crane assembly
- Exterior finishes
- Interior customizations
- Surveillance/alarm systems
- Sprinkler systems
- HVAC options
Cost of Leasing a Modular Building
When looking to lease a standard modular building, rates generally run from $1 to $1.50 per square foot per month. The primary drivers of your specific monthly rate include the length of your lease and the building size.
Modular Building Costs Compared to Traditional Construction
Prefab construction is a rapidly-growing alternative to traditional, site-built construction. But how do the costs of these two construction methods compare? In general, traditional construction projects will cost between $160 to $170 per square foot. Compare that to the modular building costs outlined above, and you’ll see that most temporary modular buildings and even smaller custom modular buildings can all be completed at a lower cost per square foot.
Should I Lease or Purchase a Modular Building?
The answer to this question really depends on your needs and priorities. Here are the pros and cons of leasing or purchasing buildings.
Lease a Modular Building
Leasing a modular building provides on-location building space without having to immediately pay out a significant amount of capital, or even borrow funds. It provides you the flexibility to manage your balance sheet and cash flow effectively and focus your capital on investments in your core business operations.
Leasing a modular building is the best option when you:
- Have a temporary need with a defined end date
- Want a low monthly payment to help contain upfront capital expenditures
- Don’t want to borrow from a financial institution
- Don’t want to own the building
- Want the cost of big-ticket items such as mechanical components and large maintenance items to be covered
Purchasing a Modular Building
If you have borrowing capacity and you want to build equity in your new building, then purchasing a modular building is an option you should explore.
Consider purchasing a modular building when you:
- Plan to use the building for a very long time
- Have plans for future expansion
- Want a custom design or specific materials and features
- Want ownership of the building and the equity it earns
If an immediate purchase isn’t financially possible, you could also research an operating lease with a buyout. After paying a monthly lease rate for an agreed upon length of time, you pay off the remaining cost of the building in a single buyout payment and have outright ownership.