Cost per Unit / m² represents the calculated construction or development expense allocated to each individual property unit or per square metre of a building within a property development project. It includes direct costs such as materials, labour, and on-site expenses, and may also incorporate certain indirect costs depending on the development finance structure. This metric is widely used in property development finance UK to benchmark project costs, compare potential sites, and inform Loan to Value (LTV) assessments. Accurate calculation is essential for SME property developers to plan budgets, manage cash flow, and secure suitable funding.
This sits within Cost & Budget, reflecting a specific measurement approach that influences how performance, risk, or funding constraints are assessed. It is commonly considered alongside Value Engineering Metrics, as both are closely related measures used to assess similar aspects of performance or risk. In funding terms, Cost per Unit / m² is most commonly encountered in connection with Straight Common Equity within the property development capital stack.
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