Do you want to start a shopping center and you want to know the cost per sqm? If YES, here is an estimated cost breakdown to build and open a shopping mall. Shopping centres or malls are clearly different from downtown and local business strips. The building of a shopping centre is pre-planned as a merchandising unit for interplay among tenants.

The site is selected by the developer to pull customers from a trade area. On-site parking is a common feature of the layout. The amount of parking space is directly related to the retail area. In the United States, customers like the shopping centre’s convenience.

They drive in, park and walk to their destination in relative safety and speed. Some shopping centres provide weather protection, and most provide an atmosphere created for shopping comfort. For the customer, the shopping centre has great appeal.

Why Shopping Malls are Expensive to Build

The main reason shopping malls are so popular is that they are very convenient. Most of them include clothing stores, a food court, movie theatres, arcade rooms, and much more. However, not every shopping mall is the same but they all basically have the same things; shopping and a place to hang out and cruise with friends, maybe even meet new people. Also shopping malls are for all ages, not just teenagers, and for all kinds of people.

A shopping mall generates a lot of revenue, with holiday shopping and tourists. When the seasons change, sales come with it, as new shipments come in, with new styles. Plus with a shopping mall comes jobs and businesses. Many businesses hire when the holidays are near, but this is only a seasonal employment. Discounts usually come with a job at the mall, so this makes getting a job there more appealing.

Estimated Cost Breakdown for Building a Shopping Mall

There are many variables when estimating the exact cost of building a shopping centre or mall in the United States. For instance, shopping malls are different from other retail store construction projects since they have a huge number size differences, they do not use the same construction techniques or configurations, and a great deal of variation can appear when site conditions are difficult.

Nonetheless, the national average is $24.9 million for a medium – sized shopping mall, although this cost does not include land purchase and clearing. To build a mall, demolition may be necessary, and this will add significantly to the total cost. Note that a typical mall has four anchor stores, two floors, and 56,000 square feet.

Ideally, mall size and cost vary greatly according to size, site conditions, construction techniques, tenants, amenities, and location. Also note that mall construction requires the participation of an owner/developer, architects, general contractor, and subcontractors. Typically, malls use “best” quality building techniques and materials in order to minimize bonding and insurance costs.

Of the average $24.9 million total cost, the breakdown is:

1. Architect Costs – $4.23 million

Architects will take about 17% ($4.23 million) of the total budget to build a mall. In return, you receive the following services:

  • Develop/ascertain project budget
  • Draft plans for proposed work
  • Create schematics and floor plans
  • Interface with structural engineers and governmental planning agencies
  • Finalize all details for drawings, materials, and finishes
  • Serve as or work with the project manager
  • Obtain permits
  • Advise about selection of contractors and bids
  • Complete all documents necessary for construction

2. Materials – $11.9 million

The concrete foundation, steel or steel/wood roof, vinyl and carpeted flooring, interior wall materials, framing materials, lighting, plumbing, HVAC, security, brick exterior, and other optional and additional materials as needed according to design. The cost of materials in this process is estimated at $11.9 million.

3. Machine/Equipment costs – $1.5 – $2 million

This cost includes various cranes, excavating equipment, cherry pickers, and other industrial equipment needed for construction. The estimated cost is $1.5 – $2 million.

4. Contractor Costs – $3.49 million

To build a shopping mall, a contractor who is responsible for the daily management of the project will cost about 14% ($3.49 million) of the total budget. Additionally, a contractor might extract $3+ million in indirect fees and mark – ups. Contractor tasks include:

  • Procuring all materials and services
  • Selecting and hiring subcontractors
  • Collaborating with the architect and the owner to evaluate plans
  • Pulling all permits for work and installation of utilities
  • Overseeing all construction
  • Providing final cleanup of the construction site

The above figures place this construction at a $442 per square foot cost, though a national average of stands between $325 and $450 for many mall projects. Note that this pricing structure assumes that all labour is “unionized” and if this were not the case, the “open shop” pricing would adhere to the following averages – carpenters, masons and excavators charge an average of $70 per hour, electricians between $65 to $85 per hour, painters between $20 and $35 per hour and plumbers between $45 and $65 per hour.


Building a shopping centre is a complex task that takes a whole team of trained professionals. This is not a project that can be done on a DIY basis, for obvious size issues and equipment needs if nothing else. However the cost estimate above does not include taxes or permit fees.

A shopping mall will require a number of different permits for new construction. Most times, the contractor will take care of this and may include permit costs in their estimate. Also not considered in this estimate is the cost of constructing and finishing the parking lot or parking structure. This is just for the main shopping mall building.

Solomon. O'Chucks