Too often I hear from building owners that there is never enough money to take care of their assets, and that is especially true when it comes to roofs. Many think that buying a new roof is the most expensive part of the entire process. However, the real cost is when an owner fails to take care of this asset. If properly installed, a low-sloped roof can last 20+ years. Unfortunately, owners fail to perform the basic maintenance which can insure that it will last that long. So, let’s look at what that cost can mean.
Let’s assume your roof cost was $1 million and it is supposed to have an economic life of 20 years. If we use a meager rate of inflation of 2% (I am using this low rate because we are in a period where there is currently very little inflation), the replacement cost in 20 years will be nearly $1.5 million. So, to budget for the same roof in 20 years, one will need to set aside $75,000 per year. What happens if one does not properly maintain the roof and it then lasts only 15 years? Using the same set of calculations, you will need $1.35 million to replace the roof at Year 15, which translates into budgeting $90,000 per year for the next roof replacement. Just getting your roof to last 20 years means you had to budget $1.125 million by Year 15, versus budgeting $1.35 million, which is a difference of $225,000. But remember, we are not yet comparing apples to apples. Maintaining a roof costs money. So, let’s assume we spend $1,000 per year for the first 10 years, and then spend $3,000 per year for the last 10 years, which is a total of $40,000 over 20 years. Since the unmaintained roof only lasted 15 years, the maintenance money spent over the same period is only $25,000, which means the owner who failed to maintain the roof wound up spending an additional $200,000 over that 15-year period just because he/she failed to perform the necessary maintenance on his/her roofs.
What happens if you are able to extend the life of the roof to 25 years, which is not uncommon if the roof is properly installed and maintained? The replacement cost for this $1 million roof is now $1.64 million, which if straight-line averaged over 25 years is $65,600 per year at a 2% inflation rate. Simply extending the life of the roof by only 5 years decreases the yearly cost by $9,400 per year. If we spend $1,000 per year for 10 years on maintenance, $3,000 per year for the next 10 years, and then increase it to “$10,000 for the last 5 years, our total cost is $90,000. However, with the unmaintained roof, we spent $1 million for a 15-year roof, and then had to spend $1.35 million for the new roof, which means we spent $2.6 million over a 25-year period, again based upon a 2% inflation rate. This is an average cost of $104,000 per year over that 25-year period. We essentially increased our yearly cost for the same roof by $38,400 per year. Over a 25-year period, that total cost is $960,000. Oh, it’s really $870,000 if we subtract out our maintenance cost of $90,000. Now do this with all of your roofs and we are now talking about some really serious dollars.
Keep in mind that higher inflation rates will have a much more detrimental impact upon future dollars needed for replacement. In comparison, the dollars spent on maintaining the roof become even more insignificant relative to inflated replacement dollars. If you are a maintenance/facilities director, developing a life cycle cost analysis for the roofs on your facilities can be used to justify the importance in maintaining your roofs to your building owners. So, when is the right time to get started? How about today?
Raymond Ramos, President of Raymond Engineering, is a 1976 graduate of the Virginia Military Institute and holds a Bachelor of Science Degree in Civil Engineering. After serving 8 years with the U.S. Army, he has become a renowned building envelope engineer. He is a Registered Professional Engineer in multiple states and is a Registered Roof Consultant. You may contact him at firstname.lastname@example.org