Square foot cost is the total construction cost divided by the building's gross or rentable square footage. It is the most common high-level cost metric in commercial real estate. Typical ranges in 2026 dollars: $250-400/sf for ground-up office, $300-500/sf for restaurant new build, $400-700/sf for medical office, $500-900/sf for tenant improvement on healthcare, $200-350/sf for industrial warehouse, $150-250/sf for residential remodel renovation per the area renovated.
Square foot cost is useful for early budgeting, owner pro forma development, and benchmarking against comparable projects. It is dangerous as a final estimate because the underlying assumptions (location, scope, finish level, season, design complexity) drive enormous variability. Two restaurant builds in the same city can come in at $300/sf and $600/sf and both be defensible numbers based on the actual scope. Use square foot cost for sanity-checking detailed estimates, not as a substitute for them.