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Business Owner’s Guide to Commercial HVAC Installation Costs

by The Cooling Company, on Aug 5, 2019 2:30:18 PM

If you need a new commercial HVAC system for your business, you’re going to have a lot of questions, one of which is “How much will it cost to install?”

You’ll receive a lot of installation quotes if you approach various contractors, but interpreting them may be difficult if you don’t fully understand:

  • What HVAC system types are available
  • The factors that affect installation prices
  • What a reasonable price may be anna-demianenko-CPWhnIkL4Lk-unsplash

Make no mistake about it: a good commercial HVAC system is not cheap. But as a Las Vegas business owner, you know that maintaining comfortable indoor temperatures is essential for employee and customer retention, especially during the height of summer. When you buy an energy-efficient system that is built for long-lasting performance, the reduced utility bills and maintenance costs will soon compensate for the initial financial outlay.

There are multiple factors that affect the installation cost of a new commercial HVAC unit. Below is a general guide that covers what these conditions are and how they affect pricing.

New system installation or replacement?

If your commercial building already has a central air conditioning system, replacing it with a new and more efficient unit will be less expensive than adding an HVAC system to a property that has never had central heating and cooling. The reason is that brand new installs are more labor-intensive: your contractor will need to install ductwork, drains, decking, and wiring to support the new equipment, all of which increase cost.

System type

Installation cost can vary according to the type of system you’re buying, as each one has specific installation requirements. Below is a general overview of the different units that are commonly available:

  • Package Units: These systems are the most popular type for commercial spaces because their heating and cooling capabilities are both efficient and effective.
  • Heat pumps: Seen more frequently in warmer climates, heat pumps are more expensive than central air conditioners, but in the right climate, they can save money. Heat pumps are available as split systems or packaged units.
  • Ductless mini-split systems: If you only need to cool a small office or store, mini-split systems are convenient because they don’t require ducts. For larger spaces, however, they can be an expensive option because they need to work harder to provide sufficient cooling.

While the type of HVAC equipment you purchase affects pricing, remember that higher upfront cost can save you money in the future. For example, a VRF system is a more powerful yet complex HVAC technology than a water-cooled system, so you’re going to pay more for both materials and labor. However, VRF systems offer consistent comfort while remaining energy-efficient and less prone to an expensive breakdown, so you save on energy and maintenance costs for many years to come.

System size

Size has a significant impact on how much you pay for your HVAC installation. Central air conditioners are measured in tons, which refer to the system’s ability to cool your space. In general, a one-ton A/C unit can cool 12,000 BTUs per hour. A system this size is designed to control temperatures in a 400 square-foot area, while 2,000 to 2,500 square feet will need a 34,000-BTU unit. The more cooling ability you need, the more that the system installation will cost.

Building size

The size of your commercial space dictates how much cooling is necessary, which in turn directs what size HVAC system you buy. The larger your office or retail premises, the bigger the system you will need to control internal temperatures, and you will pay more to have it installed.

Some business owners attempt to save money on purchase price and install costs by buying a smaller system, but if the system is too small for the commercial space, it will be less energy-efficient and can even wear out sooner.

HVAC units with an output that’s too high will also cause problems because they will cool your space too quickly and shut off before it can be properly dehumidified. A reputable HVAC contractor can carry out a load calculation and energy analysis for your building, which will make it easier to identify the right size system.

SEER rating

Seasonal Energy Efficiency Ratio, or SEER, indicates how efficient an HVAC system is. It measures the unit’s cooling output against the energy consumed. The higher the SEER rating, the less expensive it is to operate. When you’re having a new system installed, a minimum rating of 16 SEER is recommended. While newer commercial HVAC systems with higher SEER ratings have a higher purchase price, it is offset by the energy savings you realize over the lifespan of the unit.

EER rating

All commercial HVAC systems have an EER, or Energy-Efficiency Rating, that ranges from 8 to 11.5. EER is calculated by comparing its BTU rating to its wattage. For example, if you have a 10,000 BTU air-conditioning unit that consumes 1,200 watts, it will have a rating of 8.3. The higher a system’s EER rating, the more efficiently it operates. If you install an HVAC system with a higher rating, you generally spend less money on installation, servicing, and repair costs.

Installation Difficulty

Some building structures are straightforward, while others can be more complicated. If the HVAC unit needs to be in an unusual location or one that’s difficult to reach, the installation cost will be higher because more planning, materials, and labor will be involved. 

Ductwork

If you are replacing an existing system and the existing ducts and piping don’t need to be redesigned or replaced, the cost of your commercial HVAC installation will be lower. At the very least, your ductwork should have:

  • Manual dampers at each TY junction for air balance
  • Proper insulation at these junctions to minimize the risk of condensation and water leaks

If the ductwork has not been correctly installed and maintained or the zone control systems are not working, it can:

  • Reduce system efficiency due to leaks
  • Create hot or cold spots in the building
  • Cause mold growth

Your HVAC contractor can verify whether your ductwork has issues that will affect the installation costs so that you can make an informed purchasing decision. In some cases, you may have to put in new ductwork along with new pipes to distribute the refrigerant (for air-cooled systems) or water (for water-cooled units), which will raise the price.

If you need new ductwork, another factor to consider is how complicated the installation will be. If you’re doing an overall renovation with the ceilings and walls taken down, the install will be easier and can be done more quickly, lowering labor costs. However, if your business will be open while the HVAC system is being installed, it can be more challenging and therefore more expensive. For example:

  • The HVAC technician will have to work through ceiling grids and in tight spaces
  • Some installation steps may need to be done after hours, which can incur overtime costs. For example, pipes cannot be soldered during business hours in an occupied building because fire alarms might be set off.

The number of supply and return vents needed in the space

If you need ductwork installed, your HVAC contractor will also have to apply supply and return vents to circulate the conditioned air through the building. The more spaces that need cooling, the more vents will be required, so if your commercial space has multiple floors and rooms, the installation price will go up accordingly.

System controls 

Just as system complexity dictates HVAC equipment and installation costs, the controls you select will have a similar effect. Depending on the size of your business, you may need a simple thermostat attached to a single HVAC unit or a more intricate setup consisting of multiple locations connected to a central office. Even if you only need a single thermostat, the price will be higher if you want a smart model with remote connectivity. Your HVAC contractor will recommend the best control setup for the size of your business. 

Add-ons and upgrades

When you receive a quote for a commercial HVAC system, the price is usually for the system alone. If you add comfort-enhancing components, such as the following, it will increase the overall cost of the unit.

  • UV air filtration systems
  • Humidification equipment
  • Electrostatic filters

While not an integral part of most HVAC systems, these add-ons can present enough benefits to make them worth the investment.

System startup costs

Once your new heating and cooling system is installed, starting it up will incur an additional installation cost, most of which will be labor. (If you have an air-cooled system, the cost of refrigerant will also apply.) How much you will pay in labor charges will depend on:

  • How many units you purchased
  • The complexity of your system

For each line and unit, your HVAC technician will have to test thermometers, gauges, wells, and thermostats before the system can be used.

Miscellaneous charges

Depending on your setup, there may be installation charges that increase the overall price of your installation. They include but are not limited to:

  • Any necessary city inspections and permits. Some HVAC installation companies will carry out controlled inspections to confirm the accuracy of the installation and do any required filing with the building department on your behalf.
  • Air balancing tests for air-cooled systems. This process verifies that the airflow outlined in the drawings or the manufacturer’s documentation matches what the system produces.
  • Water balancing tests for water-cooled systems. This test confirms that the correct temperature is achieved through the pipe at the right flow rate.

A new commercial HVAC system is a significant investment, but the cheapest option is not always the best solution for your climate control needs. A reputable HVAC contractor will provide you with a system that meets your budget and is backed by industry-leading warranties and guarantees. A company that refuses to compromise on service quality by cutting corners can become a trusted partner in the future success of your Las Vegas business.

At The Cooling Company we are truly looking for our client's best interest. Give us a call at 702-567-0707 and we'll meake sure to properly fit our commercial HVAC installation services to your budget's needs. Contact us today and get a personalized consultation with one of our experts. 

Topics:HVAC TipsCommercial HVAC replacementCommercial HVAC Installation

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