New Construction or Rehabilitation Cost Limits

As detailed in section 4.5.3 of the Guide, DHCD has established limits on the dollar amount of construction costs per square foot. While some unique aspects of a given project may reasonably require greater investment (for example, redevelopment of a historic building on a brownfield site), DHCD also wants to encourage selection of projects that achieve various public goals—including taking on challenging sites, building high quality projects, and serving populations with unique needs—while still doing so for competitive costs. To this end, DHCD will deduct points for projects that exceed the cost limits further described below.

DHCD will consider requests from sponsors of projects involving adaptive re-use of previously nonresidential buildings; substantial historic rehabilitation; or redevelopment/reconstruction of housing determined to be beyond repair to be evaluated against new construction cost limits rather than the rehabilitation limits below. For the purpose of determining the per square foot cost, DHCD includes all on-site and off-site development and the total construction contract less any construction contingencies. This total is then divided by the gross square footage of all buildings being built or renovated. Buildings with parking structures or internal parking will be evaluated on a case-by-case basis.

DHCD will review the cost limits before each competitive round and revise them as appropriate based on market conditions and information provided by published cost indices, such as McGraw Hill’s Engineering News Record. The current construction costs (revised June 2020) per square foot are listed below:

​Type of B​​uilding

New Construction

Rehabilitation

Cottage, Single Family, Semi-detached Dwellings, and Townhomes

$ 191

$ 196

Garden Apartments

$ 160

$ 122

Non-elevator Stacked Units and Elevator Buildings with 4 stories or less

$ 174

$ 143

Elevator Buildings of 5 or more stories

$ 191

$ 148

For more information about Multifamily Construction Cost Limits please contact:

DHCD.RentalHousing@Maryland.Gov

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