Construction Cost Management and Contract Administration from the Contract Sum to the Final Account
Julian R. Sterling
These are the companion files of Construction Cost Control by Julian R. Sterling.The book on Amazon →
The four Excel workbooks that go with the book, corrected where they were wrong. Every figure the book
prints is reproduced in them by a live formula, and each ends with a Checks sheet setting the
printed figure beside the computed one: 253 controls in all, every one green. Around them: the same
four models with the inputs emptied, thirteen working documents to print, forty questions that mark themselves,
and three cases the book names and never takes to a number. Nothing is locked, protected or watermarked.
Free to download. No sign-up, no email address, nothing to fill in.
Twelve workbooks, the printable documents and the read-me. Each group below can also be
downloaded on its own. Last revised 24 September 2026.
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These carry the book’s own figures, so that every number it prints can be traced to a live
formula. Three were revised on 24 September 2026; what changed is listed at the foot of the page.
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Chapters 1 to 11
The bridge, both cases
The contract sum rebuilt layer by layer rather than asserted: measured works at
2,180 per m2 over 8,640 m2 of gross internal area, 18,835,200, then
1,240,000 of external works and site, preliminaries at 15.0 per cent, overheads and profit
at 6.0 per cent, a contractor’s design development allowance of 2.0 per cent and
1,340,000 of provisional sums, arriving at 26,301,102, or 3,044 the square
meter and 273,970 the apartment. Move the measured rate and every layer above it rebuilds,
because each one is a percentage of the layer beneath it.
Then the eleven lines that carry Pemberton Yard to 29,153,363: a movement of
2,852,261, 10.8 per cent of the contract sum, split by
formula rather than by hand into the building the client bought, 1,052,000,
the price it lost, 2,030,500, and the money it recovered, 230,239 — of
which the workings above the lines show 1,742,160, 85.8 per cent of the loss,
standing on inputs that existed at signature. The same eleven lines run again for Case B,
the same building bought with a complete design: 90,648 dearer at the
contract, 1,620,289 cheaper at the final account, a return of
17.9 to 1. Two reconciliation cells sit under the totals and must read zero.
New on the Comparison sheet: the rate premium at which that saving disappears,
302.82 per m2, 2.02 times the 150 the book assumes. Chapter 11 says a premium
several times larger would still leave Case B ahead; at twice the premium the saving is 29,943.
The developer’s appraisal run six ways in six columns: both cases, each at the contract
sum and at the final account, and the final account once more on the pessimistic reading where
the facility is stretched to cover the overrun instead of the equity being called. On
45,312,000 of revenue, 6,200,000 of land and fees at 9.8 per cent of
construction cost, Case A is underwritten at 17.40 per cent profit on cost
and delivers 8.59: 3,131,783 of profit gone,
46.6 per cent of what was underwritten, to an overrun of 10.8 per cent. Case
B is underwritten at 17.07 and delivers 13.40. Each column shows the
construction cost being appraised above the construction cost the facility was sized on, so
the stretched reading is visible rather than asserted.
Then the headroom, solved rather than searched for. Because fees are a percentage of
construction cost and the facility is held where it was sized, revenue, land, finance and sale
costs are all fixed at the target and the break-even falls out in five lines of rearrangement:
the construction cost at which profit on cost is exactly 15.0 per cent is
27,033,648, which is 732,546 above the Case A contract sum,
or 2.8 per cent. The gap ran to 2,852,261, 3.9 times the
headroom. The sheet then proves its own answer by running the full appraisal at it and landing
on 15.0000 per cent with a difference from the target of exactly zero, and a Solve sheet does
the same arithmetic on your scheme, your target return and your contract sum, with the overrun
that would halve your return. Revised: that last figure left out a divisor and read 5,345,384 on
the book’s scheme; it is 2,812,970, and the sheet now proves it.
Six tables, each moving one input and leaving the contract sum where it is, because a table
that re-priced the contract sum as the input moved would be a re-pricing and not a stress, and
the gap would never widen. Design issued at contract, from 55 to 96 per cent, moves the
movement from 3,450,778 to 2,388,052 and the gap from
13.1 to 9.1 per cent. Provisional sums released, from 1,340,000 to 2,600,000: 1,989,054 to
3,331,821. Extension of time, from 0 to 16 weeks: 2,439,045 to 3,011,087.
Productivity loss, from 0 to 16 per cent: 2,563,921 to 2,983,325. Escalation, from 0.0 to
10.0 per cent a year: 2,714,778 to 3,055,699. And the post-award pricing premium, the input
that moves the answer least, from 2,739,976 to 2,913,939.
The book prints the movement column. The workbook prints all eleven lines for every
scenario, which is the difference between reading a sensitivity and understanding
one; the row that matches the book is shaded in each table, and each table ends on its span. A
Ranking sheet orders the six inputs by span, sets each span against the base gap, states in
one line whether the client controls that input before signature, and closes by putting the
largest single-input span beside the joint move that Case B represents and showing the joint
move exceeding it. A seventh sheet carries design completeness through to the developer’s
return, seven rows from 55 to 96 per cent and 6.90 to
9.93 per cent profit on cost, in which not one row clears the target. Revised: the column headings of the six tables sat one
column to the left of their figures, and the Ranking sheet listed the inputs in chapter order
rather than by span; both are fixed, and the control column now follows Chapter 14.
This one does not reproduce the book. It is the instrument the book argues for, and it is
meant to be used on a project that has not been signed yet. Type your own scheme in and the
contract sum rebuilds layer by layer, then hands you two figures most tenders never publish:
your time-related preliminaries per week, and the value that will be priced after signature.
The Forecast sheet forecasts the five lines whose inputs exist before signature — design
development beyond the contractor’s allowance, the provisional sums, the post-award
pricing premium, the prolongation, and the escalation on all four — then lists the rest
of the bridge and declines to forecast it, each declined row carrying a note saying why. What
it produces is called a floor on the final account rather than an estimate of it.
It ships filled in with Pemberton Yard, so the Checks sheet can prove it reproduces the book
before you trust it with anything of your own. Fed the book’s inputs, its forecast of
the knowable gap comes to 1,742,160, which is exactly the figure Chapter 2
reaches by a different route; the verdict cell then reads that against the headroom of
732,546 and writes the answer as a sentence rather than a number. Overtype
the blue cells with your own project and those checks will fail. That is the workbook working,
not breaking.
The four workbooks with every input emptied. The checks sheets count what is still missing and test what holds for any inputs.
Chapters 1 to 15
Your contract sum, your bridge, your appraisal, your tender
The bridge for two ways of buying the same building, the six-column appraisal with its headroom, the six one-input tables and the pre-signature forecast, with the same formulas and every blue cell emptied. The steps of the sensitivity tables stay: they are the grid, not data. The three declined lines of the forecast stay at zero on purpose.
The book’s inputs are listed in a text file inside the archive. Type them back in and the book’s figures come back with them: 29,153,363, 732,546 of headroom, 1,742,160 knowable before signature.
Thirteen pages to print and use. A4, with margins wide enough for US Letter.
Chapters 1 to 15
Thirteen working documents
The contract sum taken apart, with every percentage translated into the unit it is spent in. The bridge in three columns, dated input by input. The design completeness count and the exposure it creates, with the plateau derived: past 1 minus allowance over premium, 85.2 per cent here, completion pays nothing more on that line. The provisional sums schedule, undesignable or merely undesigned. The change register in two columns. What a week costs. Disruption records that make a measured mile possible. Statutory change and escalation. Credits and the payment notice calendar. Two procurement routes in one board paper. The headroom page. The ranking and the eight errors. Before, thirty, sixty, ninety.
A workbook that marks itself. Answer in the yellow cells; the marking fills in as you go.
All parts of the book
Forty questions on the book
Seven on the contract sum and the bridge, seven on design development, provisional sums and changes, seven on time, statute and escalation, seven on the credits and Case B, seven on the appraisal, the headroom and the ranking, and five on the three cases below. Numbers are marked to a tolerance, multiple choice to the letter, and the score sheet counts your errors part by part: that is your revision list.
Nothing is hidden. The marking sheet holds every answer, every tolerance, and the reason for each answer.
New material, not a restatement. Three situations the chapters name and never take to a number. Each case is one workbook: the note is the first sheet, the model is the rest, and a checks sheet closes it. Type your own figures in and every finding recomputes.
Chapter 11 · Case one
The rate premium that erases the saving
The book’s own model, both cases, nothing added, with one input moved: the Case B measured rate. The 150 per m2 the book assumes costs 1,587,723 through the markups and nets to 90,648 only because the allowance and the provisional sums fall. Each further pound per m2 adds 10,602 to the Case B final account, so the 1,620,289 saving is gone at 302.82 per m2, and the developer’s advantage at 292.08. At three times the premium Case B ends 1,560,404 worse. The comparison survives about twice the premium, not several times, and that is the figure to put to the tenderers.
Chapter 10 · Case two
The damages rate as a pre-estimate
Chapter 10 sets the 14,500 damages rate against the contractor’s preliminaries. The client’s own weekly cost is the interest on its facility: 34,640 a week fully drawn at completion (ADDED), 20,784 at the book’s average draw. The rate stops covering the interest alone above a draw of 41.9 per cent. Three weeks at the client’s cost would have recovered 103,920 instead of 43,500, and the fourteen late weeks the static appraisal leaves out cost 484,962, taking the delivered return to 7.34 per cent.
Chapter 11 · Case three
What Case B costs to buy
The omission the book says to press hardest, priced with thresholds rather than invented figures. With the chapter’s twelve extra weeks of design and land carried at 6,122 a week (ADDED), the extra design fee that would erase Case B’s delivered advantage is 1,698,495, 66 per cent of the whole fee line: the book is right that it would have to be very large. At an ADDED fee of 300,000, Case B still delivers 12.35 per cent, and the rate premium it can afford falls from 292 to 262 per m2.
Conventions used throughout
Blue text
an input — change it and everything recomputes
Yellow fill
an assumption that decides the answer rather than merely feeding it
Black text
a formula — do not overtype these
Grey text
a note
Checks sheet
the printed figure beside the computed one, the difference, a PASS or a FAIL, and the tolerance being applied
Blank set
the same models with every input emptied: each checks sheet counts what is missing and ends ALL OK when the file holds together
ADDED
a figure the book does not give, used in the cases and marked wherever it appears
Why the checks matter more than the models
A workbook that agrees with a book proves nothing on its own — the author wrote both. What
the Checks sheets do is different: they force the model to reproduce a number that was printed
before the model existed, from a formula rather than from the number itself.
On this book the discipline caught the liquidated damages line. The client recovers damages for
the weeks the contractor is late less the weeks it carries an extension of time, at
14,500 a week and under a cap, and the model writes that as
max(0, weeks late less weeks with an extension). Written the obvious way, as a
MIN against the cap with no floor beneath it, the arithmetic runs on past zero the moment the
extension exceeds the delay — and one of the sensitivity tables does exactly that, taking
the extension of time from 0 up to 16 weeks against a delay of 14. At the top row the line
changed sign: a 43,500 credit to the client became a 29,000
charge against it, a contractor paid damages for finishing early on time it had been granted, and
the movement column carried the error without ever looking wrong.
The second thing the checks caught is smaller, and it is left in view rather than tidied up.
Construction costs are carried between the workbooks rounded to the pound, as the book prints
them, so a figure the appraisal rebuilds from a rounded input can land one pound from the figure
on the page. Seven do: five in the appraisal, on the finance line, the total cost, the profit and
the profit lost to the gap, one in the pre-signature workbook, and the overrun that halves the
return on the revised Solve sheet. None of the six is smoothed
away by widening a percentage or nudging an input. Instead every Checks sheet carries a sixth
column stating the tolerance it applies, one pound on the fifty-one money checks that are fed a
rounded cost and eight decimal places on the other 202, and the difference column prints the
pound. 246 of the 253 land on zero.
Where two readings of the same quantity are defensible, both are printed. The Case A final
account returns 8.59 per cent profit on cost with the facility held at the amount
it was sized on, and 7.99 where the facility is stretched to cover the overrun
instead of the equity being called; Case B, 13.40 and 13.14.
Neither column is the answer on its own, and the workbook does not choose between them.
Go beyond the companion files
Construction Cost Control develops the complete framework behind these models, with the assumptions, trade-offs and worked examples tied together.
The workbooks open in Microsoft Excel, LibreOffice Calc, Google Sheets and Numbers; the PDF
prints on A4 or US Letter. They use no macros and no add-ins, so nothing needs to be enabled or trusted. If your spreadsheet asks
to update links on opening, decline — there are none.
What changed, and when
24 Sep 2026
The four workbooks recalculated; 253 checks, all PASS. The Solve sheet’s overrun that halves the return corrected: 2,812,970, not 5,345,384. The six sensitivity tables’ column headings realigned with their figures, and the Ranking sheet now sorted by span. New on The_Bridge: the rate premium that erases Case B’s saving, 302.82 per m2 (Chapter 11 says several times 150 would not). Added: a blank set, thirteen working documents, forty questions that mark themselves, and three cases.
How are dayworks calculated in construction?Prime cost of labour, materials and plant plus tendered additions: 22.03 an hour, not the 17.00 wage, plus 110 per cent gives a 3,421.93 sheet, 18.0% over measured.
Closing the DealTwo defensible bridges 20.70 million apart, a peg worth 7.00 million, and the six choices that remove 6.60 of a 12.00 earn-out.
CMBS and CRE CLOsWhere the loss actually lands, from appraisal reduction to realised severity, and what the B-piece is really being paid for.
How to Read a Commercial LeaseThe three refinements chapter 19 names and never performs, and the renewal rate below which the mark-to-market is worth nothing.
How to Read a Credit AgreementWhere the default actually comes from, the cure that costs 5.5 times the other, and the capacity nobody adds up.
How to Read a Real Estate Loan AgreementThe cure ratio in closed form, the four-point window in which the cheap cure works, and the cure sized to the wrong threshold.
Office Real EstateA six per cent yield that returns 3.2 per cent once the re-letting cycle is paid for, and the headline-to-net-effective rent arithmetic.
Private Equity Real EstateBoth worked waterfalls to the dollar, the two capital stacks, and the arithmetic of the promote made changeable.
Private Markets PerformanceThirty-one of the thirty-three figures chapter 19 publishes reproduce exactly — and the two that do not are named rather than quietly adopted.
Raising a Real Estate FundThe chapter 17 funnel run on a calendar — when the first close actually lands, and why more travel does not help.
Real Estate FinanceFour people look at one building and reach four numbers; the lender is whole only above 105,109,489, twelve per cent below today’s value rather than forty.
Real Estate Financial ModelingProperty, development and fund models built line by line, and the modelling test worked end to end.
Real Estate Fund ManagementThe waterfall of 6.11, the build-to-core of 8.7 and the proceeds gap, reproduced as live formulas rather than asserted.
REIT Analysis and ValuationFFO of 532.0, AFFO of 381.0, net asset value and dividend safety — every figure a formula you can change.
Retail Real EstateThe occupancy cost of every unit in a centre, the sixteen per cent of the rent roll no tenant can sustain, and the right-size-convert-or-hold decision priced.
Sale and LeasebackA €179.5 million transaction end to end, with rent cover measured on the entity that actually signs the lease.
Self-Storage Real EstateThe cohort engine behind a 590-unit store, and the rate increase on existing customers priced against the move-outs it causes.
The Fund Finance ProfessionalChapter 8 builds the reported-to-eligible NAV bridge; chapter 9 computes every ratio without it. Two points at every state — and what a subscription line does to the IRR.
The Growth Equity InvestorWhat a pro rata cheque really costs, and the band where defending your ownership loses money.
The Private Credit InvestorThe two coverage ratios are not measured on the same thing: the erosion is 47.7 per cent, not the 28.7 the headline implies.
The Private Equity Fund Controller PlaybookThe book defines IRR, DPI, RVPI and TVPI, tells you to update them at the exit, and prints not one value. Computed: a 1.833× deal inside a fund at 0.892 TVPI.
The Venture Capital AssociateWhat defending a position costs, and how many companies a reserve pool actually defends.
Financial Risk ManagementA fund inside every limit that cannot meet a redemption — and the number that decides it is the one with no currency attached.
Business ValuationThree advisers land 26.8 per cent apart on one company, and the whole gap turns out to be 1.96 points of perpetual growth.
Quantitative FinanceThree models agree to a quarter of one per cent about a number that one unobservable input moves a hundred and three times as much.
Asset ManagementFour people quote four returns for one mandate, all correct and 2.7017 points apart — forty-eight times the manager’s net skill.
Alternative InvestmentsA manager reports 13.29 per cent and the endowment earns 6.26 — both correct, and only a third of the advertised advantage arrives.
Venture CapitalOne company out of twenty-eight returns 56.7 per cent of the fund, and half the capital goes in after the decision — at half the return.
Machine Learning for FinanceFive people quote the accuracy of one credit model, all five are right, and the number that decides how much money it makes is none of them.
Commercial Real Estate InvestingThe equity earned 8.6647 per cent and the investor received exactly 8.0000 — the preferred return, and nothing above it.
Mergers and AcquisitionsThe board paper says the deal creates 13,436,667 of value. The arithmetic says it destroys 17,530,855. Nobody is lying.
DerivativesThe treasury report says the hedge cost 1,233,698. That is the interest differential, not a cost.
Treasury ManagementFive cash balances for one company, all correct and 145,600,000 apart — and the revolver that is two-thirds of the liquidity leaves at a revenue fall of 8.4127 per cent.
Financial Planning and AnalysisRevenue 3.0190 per cent above budget and operating profit 16.3209 per cent below it, in the same quarter, with every figure correctly stated.
Energy TradingA position report that is 91.7031 per cent hedged and correctly computed, on a book that is short 2,542,000 MWh — and a margin call of 198,400,000 the next morning.
Pricing StrategyA list price of 148.00, a pocket price of 112.51, and the nine deductions in between — with what one point of price is actually worth.
Trade FinanceSix routes to payment on one 4,200,000 export order cost between 178,040 and 223,268, a spread worth 14.8 per cent of the margin, and a day of buyer credit costs 1,031.76.
Cost AccountingOne factory costed twice on the same 13,440,000 of overhead, and 4,053,091 moves between four product families.
Contract ManagementA bid 5.50 a unit cheaper, signed on paper worth 9.81 a unit more — and 94.68 per cent of it was knowable on the day of signature.
Capital MarketsFour defensible readings of one bond, the cost of an issue under each convention, and the placement discount computed at a constant discount.
Financial RegulationThree ratios pass and the fourth is in breach by 1,956.0 million: the output floor, the liquidity buffer after encumbrance, and the loan split.
Bank ManagementFour defensible readings of one balance sheet, the deposit beta measured two ways, and the liquidity that lasts 3.9 days.
The Real Estate WorkoutFour ways out of one broken loan, discounted to today, and the 58.7 cents at which a payoff beats enforcement.
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