What is Project Unit Cost Method

Project Unit Cost Method is cost estimation (planning) method that stands for addressing a typical unit of project then multiplied by the total number of units necessary to complete the project, which allows calculating an overall cost estimate. As a standard unit you may take any functional element of the project, which will be duplicated along with the project performance. For example, when you need to erect a building you may calculate costs per floor (if there will be many typical floors in the building) or per one square foot, so the total number of floors or square foots will be multiplied by average planned costs to compute the total construction cost: if you need to construct a hotel of 10 floors where you will have 8 floors of business class rooms ($ 1 000000 USD per one floor) and 2 floors of luxury lodging ($ 2 000000 USD per one floor), then total projected costs will be 12 millions (8*1000000 + 2*2000000). These costs don’t include amounts that you need to pay for constructing stairwells, internal walls, elevators, etc, so when these expenses are added to the unit cost estimation the results become more accurate. 

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