In CSI and general construction budgeting practice, project costs are often discussed in terms of:
Hard costs – also called direct construction costs, generally associated with the actual construction of the facility (labor, materials, equipment, and construction-related services).
Soft costs – professional services and non-construction expenses, such as design fees, legal fees, financing costs, some testing and inspections, and administrative costs.
Other development costs, such as land acquisition, that may be tracked separately from construction vs. soft costs.
Within that framework:
Hard costs are those closely tied to getting the building or facility physically constructed and operational. In many project budgets, commissioning work that is specified as part of the construction/contractor’s scope (functional testing of systems, demonstrating performance, etc.) is treated with the construction scope and appears with construction-related costs.
Among the four items given:
Architect/engineer design fees (A) – clearly a soft cost, part of professional services for planning and design, not part of direct construction.
Project financing (C) – interest during construction, loan fees, and similar items are typically categorized as financing/soft costs, entirely separate from construction.
Land acquisition (D) – usually tracked as a separate property or development cost, not within the construction hard-cost category.
Commissioning fees (B) – frequently included in the construction or closeout scope (and often in specifications under Division 01 or relevant technical Divisions) and directly associated with making systems function as intended. When commissioning is contracted as part of the construction contract (which is a common CSI-based approach), its cost is embedded in the hard construction costs.
In CDT-aligned budgeting discussions, when you’re forced to choose among these four, commissioning fees (Option B) are the closest to and most consistently treated as a construction-related (hard) cost, because they are often part of the contractor’s scope and necessary to complete and hand over a functioning facility.
The others—A/E fees, financing, and land—are clearly outside of direct construction and uniformly treated as soft or separate development costs in CSI-oriented project cost breakdowns.
Key CSI and industry references (titles only, no links):
CSI Project Delivery Practice Guide – sections on “Project Costs” and distinctions between construction cost and project cost.
CSI CDT Body of Knowledge – “Owner’s Costs, Construction Costs, and Cost Categories.”
Typical CSI-based Owner–Contractor contracts and Division 01 sections where commissioning requirements are placed within the construction scope.
