Hard Cost Curve

A hard cost curve, also known as a construction drawdown schedule or S-curve, is a graphical representation of the rate at which the hard costs (direct construction costs) are incurred over the duration of a construction or real estate development project.

The curve typically starts off slowly, increases as construction activity ramps up, and then tapers off as the project nears completion. The shape of the curve often resembles the letter "S", hence the name "S-curve".

The hard cost curve is useful for several reasons:

Budgeting and Cash Flow Planning: It helps in understanding when the funds will be needed during the project, assisting in cash flow planning.

Progress Monitoring: Comparing the actual costs incurred at any point in time with the planned costs (as per the curve) can give an indication of whether the project is on track, ahead, or behind schedule.

Forecasting: It can be used to forecast future cash outflows based on the progress of the project.

It's important to note that the shape and slope of the hard cost curve can vary depending on the type of project, the construction method, and other project-specific factors.