Cost of a New Commercial HVAC System

Understanding the Cost of a
New Commercial HVAC System

Commercial HVAC systems are expensive. There are many factors that will impact the type of unit you need and the cost of installing it. The list below is designed to help you understand what items each contractor must consider before bidding on these types of commercial jobs.

1. Building use

What type of business are you running? The HVAC needs of a warehouse or factory are going to very different than those of a retail store. For instance, if you are running heavy machinery or other equipment that produces excess heat, you may need to increase the cooling capacity of your air-conditioning unit.

2. Occupancy

How many people are working in the building? Do you have a lot of people working in a confined space? Or, do you have a large office that only a few people are working in? Installing a system with multiple heating and cooling zones can help maximize efficiency.

3. Travel time

How far does the contractor have to travel to the job site? If your building is located within the contractor’s normal service area, you should not have much to worry about. However, if your business is located in a remote area, ask if the contractor charges extra for long-distance travel.

4. Labor rates near you

Labor rates vary significantly from coast to coast. If the cost of living in your area is high, you can expect to pay a higher hourly rate for the contractor’s time. If the business is located in a more rural area, the labor portion of the bill may be a little lower.

5. Local building codes

It’s important that your new HVAC system is compliant with local and statewide codes. A licensed contractor in your area is the best resource for determining how these codes will impact your installation process. Codes can vary greatly between jurisdictions. Keep in mind that these codes are designed to keep building users safe.

Your contractor should also help you secure the necessary permits. All inspection fees should be included in the contractor’s itemized estimate.

6. Building orientation

Is your building located in direct sunlight? Or, are you situated in the shade most of the day? The elevation and geographical location of your property may impact your HVAC needs significantly.

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7. HVAC Brands

There are many different manufacturers of HVAC equipment. High-end brands are going to come at a higher price point. Most contractors will have a number of brands that are comfortable working with. Ask your contractor if he or she has installed a system like yours in the last 12 months. The answer should be, "yes”.

8. Load calculation

Properly sizing and designing the system is a difficult task. There are many factors that go into calculating the load capacity, including the square footage of the building, the ceiling height, the R-value of the insulation, the type of windows, and the desired indoor temperature. Calculating the load is not a guessing game. Many contractors will use industry-specific software to come up with an appropriate room-by-room calculation.

An over-sized unit will “short-cycle” frequently, which can take years off the life of the system. It will cost more to install and operate. An undersized unit will not be able to keep the temperature as comfortable as a properly sized unit.

9. Ventilation

We cannot overlook the importance of proper ventilation. It’s important to make sure that the air in your building is safe to breathe for all employees and visitors. Indoor air quality should always be a priority for you business operation.

10. Insulation

Is this building well-insulated and airtight? Or, are there drafty windows and doors throughout? Installing insulation is a great way to improve the energy efficiency of your office or warehouse. High R-value insulation is better equipped to prevent heat loss and keep people comfortable throughout the year.

11. Weather & climate

A warehouse in Phoenix, AZ has very different heating and cooling needs than a restaurant in Boston, Massachusetts. It’s important that the load capacity is calculated with respect to your region’s climate. Your climate may also influence the type of equipment you install. While swamp coolers (or evaporative coolers) are very popular in dry climates, they are much less effective in humid areas.

12. Energy efficiency

High-performance, energy efficient equipment is typically more expensive at the time of installation. However, you are more likely to recoup your initial investment with lower energy bills each month.

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Commercial HVAC on a Budget