Commercial construction cost per square foot in 2026.
A sector-by-sector cost reference for owners and developers pricing healthcare, retail, restaurant, office TI, and ground-up commercial projects across the Western U.S.
The numbers below reflect actual 2025-2026 pricing on projects we've bid, awarded, or delivered across California, Arizona, Nevada, Oregon, Washington, Utah, Colorado, and Idaho. Ranges are all-in hard cost per square foot excluding land, FF&E, and owner soft costs. Apply the regional multiplier for your market, then add contingency.
These are rough-order-of-magnitude (ROM) numbers useful for feasibility and lease decisions — not a substitute for a schematic estimate or a GMP. When you're ready to price a specific project, reach out for a scoped estimate.
Healthcare & medical office — 2026 cost per square foot
| Scope | $/SF (low) | $/SF (high) | What's in it |
|---|---|---|---|
| Medical office building (MOB) shell | $250 | $400 | Class A shell, no MEP finish-out. |
| Medical office TI (primary care / specialty) | $175 | $350 | Exam rooms, lab, imaging-ready MEP. |
| Ambulatory surgery center (ASC) | $500 | $900 | OR-grade HVAC, medical gas, backup power. |
| Dental / orthodontic fit-out | $200 | $375 | Op chairs, plumbing, compressed air, vacuum. |
| Imaging suite (MRI / CT retrofit) | $450 | $800 | RF shielding, structural, chiller loop. |
Retail & multi-site rollouts — 2026 cost per square foot
| Scope | $/SF (low) | $/SF (high) | What's in it |
|---|---|---|---|
| Second-generation retail TI | $100 | $200 | Reuse existing MEP + storefront. |
| Prototype in-line store | $175 | $300 | Brand-standard finishes, fixtures by owner. |
| Ground-up single-tenant retail pad | $275 | $425 | Includes site, utilities, entitlements. |
| Big-box remodel (occupied) | $90 | $175 | Night phasing, fixture protection. |
| Bank / credit union branch | $350 | $550 | Vault, drive-thru, security systems. |
Restaurant construction — 2026 cost per square foot
| Scope | $/SF (low) | $/SF (high) | What's in it |
|---|---|---|---|
| Second-generation restaurant conversion | $175 | $325 | Reuse hood + grease trap where possible. |
| Full-service restaurant TI (new kitchen) | $300 | $500 | New Type I hood, gas, walk-ins. |
| QSR ground-up with drive-thru | $550 | $900 | Site, utilities, brand-standard build. |
| Fast-casual in-line | $275 | $475 | Open kitchen, POS, front-of-house finishes. |
| Ghost kitchen / commissary buildout | $200 | $375 | Multiple hoods, minimal FOH. |
Office & tenant improvements — 2026 cost per square foot
| Scope | $/SF (low) | $/SF (high) | What's in it |
|---|---|---|---|
| Basic office TI (paint + carpet + light) | $40 | $90 | Minimal MEP changes. |
| Standard office TI (Class B/C) | $90 | $175 | Reconfigured walls, new finishes. |
| High-end / Class A office TI | $175 | $325 | Custom millwork, upgraded MEP, AV. |
| Warehouse-to-office conversion | $125 | $250 | New HVAC, restrooms, egress. |
| Life-sciences / lab TI | $400 | $900 | Fume hoods, gases, redundant power. |
Ground-up commercial — 2026 cost per square foot
| Scope | $/SF (low) | $/SF (high) | What's in it |
|---|---|---|---|
| Warehouse / distribution (tilt-up) | $90 | $175 | Concrete tilt-up, minimal office. |
| Flex / light industrial | $150 | $275 | Mix of office + warehouse. |
| Mid-rise office (Class A, 4-8 story) | $350 | $550 | Structured parking, curtain wall. |
| Multifamily / mixed-use podium | $275 | $500 | Type IIIA over concrete podium. |
| Hospitality / limited-service hotel | $300 | $475 | Per-key basis varies; add FF&E separately. |
Regional multipliers — apply to the base $/SF above.
| Region | Multiplier | What drives it |
|---|---|---|
| Coastal California (LA / Bay Area) | 1.15 – 1.35× | Prevailing wage, seismic, Title 24, permitting friction. |
| Seattle / Portland metro | 1.10 – 1.25× | Union labor, energy code, city-specific reviews. |
| Phoenix / Las Vegas / Reno | 0.95 – 1.10× | Competitive subcontractor base; heat schedule risk. |
| Denver / Salt Lake City | 1.00 – 1.15× | Strong demand, tight labor market in metros. |
| Boise / Inland Northwest | 0.90 – 1.05× | Lower base costs; travel premiums outside metros. |
| Rural / remote sites | 1.10 – 1.30× | Travel crews, per-diem, staging, longer lead times. |
Six variables that move a budget more than $/SF averages.
- MEP density: HVAC tonnage, medical gas, kitchen exhaust, and lab utilities can be 35-50% of hard cost on healthcare and restaurant projects.
- Jurisdiction: prevailing wage, permit timelines, energy code (Title 24, WSEC), and plan-check turnaround vary 3-10× between AHJs in the same state.
- Building condition: hidden asbestos, undersized service, non-compliant path of travel, and structural upgrades routinely add 10-25% on second-generation TI.
- Schedule compression: night work, phased occupancy, and expedited permitting run 10-20% over a normal-schedule baseline.
- Material lead times: switchgear, rooftop units, and specialty medical equipment carry 20-40 week leads — long-lead procurement at DD, not CDs.
- Site & utilities: on ground-up, site work and utility extensions can be 15-30% of total cost and are the single most under-estimated line item.
Commercial construction cost — questions owners ask first.
What is the average commercial construction cost per square foot in 2026?[ + ]
For most commercial projects in the Western U.S., 2026 costs run $175 to $425 per square foot for tenant improvements and $275 to $550 for ground-up depending on sector. Healthcare and restaurants trend higher because of MEP density; warehouse and second-generation retail trend lower. Regional multipliers of 0.9× to 1.35× apply on top of national averages.
How much does it cost to build a medical office in 2026?[ + ]
A medical office building (MOB) shell runs $250 to $400 per square foot in 2026. Primary care and specialty MOB tenant improvements run $175 to $350 per square foot. Ambulatory surgery centers, imaging suites, and infusion clinics run $450 to $900 per square foot because of OR-grade HVAC, medical gas, backup power, and OSHPD/HCAI review in California.
How much does it cost to build a restaurant in 2026?[ + ]
Second-generation restaurant conversions run $175 to $325 per square foot when the existing Type I hood and grease trap can be reused. A full-service restaurant tenant improvement with a new kitchen runs $300 to $500 per square foot. QSR ground-up builds with a drive-thru run $550 to $900 per square foot including site, utilities, and brand-standard finishes.
How much does a retail store buildout cost per square foot?[ + ]
Second-generation retail TI runs $100 to $200 per square foot. Prototype in-line stores run $175 to $300 per square foot with owner-supplied fixtures. Ground-up single-tenant retail pads run $275 to $425 per square foot including site work, utilities, and entitlements. Bank and credit union branches run $350 to $550 because of vaults, drive-thrus, and security systems.
What drives commercial construction cost the most?[ + ]
MEP density (HVAC tonnage, medical gas, kitchen exhaust), structural complexity, jurisdiction (permit timelines and prevailing wage), labor market tightness, and material lead times. On healthcare and restaurant projects, MEP alone is 35-50% of hard cost. On office TI, finishes and millwork drive the range. On ground-up, site work and structural system choice are the biggest levers.
What is the difference between a ROM estimate and a GMP?[ + ]
A rough-order-of-magnitude (ROM) is a $/SF or $/key range used at concept to test feasibility — typically ±25%. A Guaranteed Maximum Price (GMP) is a contractual ceiling committed at 95% construction documents once subcontractor pricing, allowances, and contingency are locked. On design-build projects Frans Construction commits a GMP before mobilization; anything above the GMP is our risk.
How much contingency should a commercial construction budget carry?[ + ]
Owner contingency of 5-10% on new construction, 10-15% on tenant improvements in existing buildings, and 15-20% on healthcare or historic retrofits. Contractor contingency inside the GMP typically runs 2-5%. Add a separate FF&E and technology budget; those are almost never in the construction number.
How accurate are $/SF estimates for commercial construction?[ + ]
A $/SF estimate is directionally correct within ±20-25% at concept and ±10-15% at schematic design. It should never be used as a commitment. Once program, site, and finish standard are locked, a schematic-level estimate with quantified allowances gets you within ±10%. GMP at 95% CDs is the number to sign a lease or a loan against.
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