Reality Check

So there's a couple of things we've encountered which we weren't expecting. First, there's an education problem. Since prefab hasn't been done in Chicago to any great extent, most general contractors are not going to be able to bid on a prefab project in a precise manner. For example, a portion of the electrical work will be completed in the factory, and then a portion of the electrical work is required to be completed on site. Unfortunately, it is unclear to the general contractor what portion of that work he is responsible for until, of course, he is educated on the specifics of what the factory is doing. To get that general contractor to understand the process, he or she has to be selected by the developer (us) so that they will invest the time and money to learn about process. This becomes a "chicken and egg" problem, and that we cannot really know if a particular GC's bid is more competitive until we hire him/her. Now when I say "us" of course I really mean Jeff because him and Kate have been combing through the bids of four general contractors that they solicited the project to to try and determine which is the best fit. There definitely are a couple that are in the lead, so they say, that have shown flexibility and innovation in how they intend to structure the project. All in all, we have remained positive, but this was not something we thought of initially.

Second, and you are probably not surprised by this, things are more expensive than we originally thought. We were happy to float along thinking we could afford things like floating staircases and FireOrbs, but in reality, this is not necessarily the case. At a minimum, we are going to have to make some changes, and some hurt more than others.

One change that should be a substantial savings is to eliminate the full basement and replace, instead, with a crawl space. In theory, I like this idea. Generally, when you have a giant place to store things, you end up filling it up with crap that you don't need. I'm reading about living a simpler and more meaningful life (The New Frugality by Chris Farrell) and like the idea of deciding what is or isn't important. On the other hand, I was thrilled to think we could put the cats' litter box downstairs and avoid the discomfort of having it on display when guests come over. Supposedly we can save between $50-$65k by eliminating the basement --- no litter box embarrassment is worth that.

Another change we are making is forgoing the floating staircase. Jeff assures us that we can still have a modern staircase with bamboo treads and steel handrails, but the floating quality is going to have to go (apparently this type of staircase alone could cost in the area of $30,000).

As it stands, we are still going to have to "value engineer" this project at all ends. We have been faced with tough decisions, such as, how important is a garage (important), how important is hardwood floors on the second floor (not that important). Can we save money by contracting out certain line items ourselves, rather than have the GC do them --- interior painting is a good example of this. Can we postpone some of the improvements at a time when we have additional funding. As it stands, it looks like the solar and PV panels may need to be but on hold.

I hope I'm not sounding disappointed with the project, because I'm not. It's become a challenge, now, to bring in the best possible project for the least possible costs, without sacrificing the things that are most important to us. Yes, it looks as though the price point is going to go up to, say, $175-$200 a square foot. I know this is not affordable to everybody.

One area that we probably could save money, but are sticking to our guns, is the high-end appliances and cabinetry from EcoUrban. In the big scheme of things, the EcoUrban cabinetry is not going to cost an outrageous amount of money, especially compared to some of their European competitors, but, yes, the Miele refrigerator is expensive. What can I say? We're suckers for integrated appliances, and don't want to compromise on these items. We are willing to pay a premium for them. Can we compromise on other things? Yes, indeed we can.

What I will leave you with is a positive thought --- one of the bidding GCs told Jeff that if the project we are building would be built on site, it would cost thousands, potentially hundreds of thousands of dollars more to build, and certainly would be assessed that way in the market. So essentially, even though we are spending more than we thought, it will be worth more than we paid the minute we move into it. That certainly helps.