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Exposing the myth of the 1:5:200 ratio relating initial cost, maintenance and staffing costs of office buildings

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Hughes, W. P., Ancell, D., Gruneberg, S. and Hirst, L. (2004) Exposing the myth of the 1:5:200 ratio relating initial cost, maintenance and staffing costs of office buildings. In: Proceedings of the 20th Annual ARCOM Conference, Heriot-Watt University, Edinburgh, pp. 373-381.

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Abstract/Summary

In an attempt to focus clients' minds on the importance of considering the construction and maintenance costs of a commercial office building (both as a factor in staff productivity and as a fraction of lifetime staff costs) there is an often-quoted ratio of costs of 1:5:200, where for every one pound spent on construction cost, five are spent on maintenance and building operating costs and 200 on staffing and business operating costs. This seems to stem from a paper published by the Royal Academy of Engineering, in which no data is given and no derivation or defence of the ratio appears. The accompanying belief that higher quality design and construction increases staff productivity, and simultaneously reduces maintenance costs, how ever laudable, appears unsupported by research, and carries all the hallmarks of an "urban myth". In tracking down data about real buildings, a more realistic ratio appears to depend on a huge variety of variables, as well as the definition of the number of "lifetime" years. The ill-defined origins of the original ratio (1:5:200) describing these variables have made replication impossible. However, by using published sources of data, we have found that for three office buildings, a more realistic ratio is 1:0.4:12. As there is nothing in the public domain about what comprised the original research that gave rise to 1:5:200, it is not possible to make a true comparison between these new calculations and the originals. Clients and construction professionals stand to be misled because the popularity and widespread use of the wrong ratio appears to be mis-informing important investment and policy decisions.

Item Type:Conference or Workshop Item (Paper)
Refereed:Yes
Divisions:Faculty of Science > School of Construction Management and Engineering > Business Innovation in Construction
ID Code:12142
Uncontrolled Keywords:occupancy costs, staffing costs, maintenance costs, offices, urban myths
Additional Information:Full citation: Hughes, W. P., Ancell, D., Gruneberg, S. and Hirst, L. (2004) Exposing the myth of the 1:5:200 ratio relating initial cost, maintenance and staffing costs of office buildings. In: Khosrowshahi, F (ed) Proceedings of the 20th Annual ARCOM Conference, Heriot-Watt University, Edinburgh, pp. 373-381. ISBN 0953416194

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