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The Difference Between Building Up & Building Out for Commercial Construction

The Difference Between Building Up & Building Out for Commercial Construction

Contemplating an expansion of your current commercial space? You’re in luck! Expanding a building can happen in two main ways: horizontally or vertically. What method you pick usually depends on what you want to add. Like, if it’s a restaurant kitchen, you’ll probably want to expand outwards. But it’s not always that simple.

When you expand outwards, most of the time, you’re making the building bigger at ground level (horizontally). Going upwards means adding more floors without making the ground space bigger (vertically). 

So, which way is better for your location?

Factors to Take into Account When Expanding Vertically or Horizontally

When it comes to expanding a commercial building either upwards or outwards, there are several factors that need careful consideration. These factors play a crucial role in determining the optimal approach for the construction project: 

  1. Financial Considerations

Ensuring that your financial resources are adequately prepared is essential before embarking on any commercial building project.

Determining which option, whether building out or up, will incur higher costs can be challenging, particularly considering the varying sizes of businesses. Expanding outwards involves excavation and constructing an additional foundation, which can drive up expenses. Conversely, building upwards may also come with hefty costs, especially when substantial support systems are required along with reinforcing the foundation. 

  1. Operational Convenience

Assessing the feasibility of maintaining business operations during the construction phase is crucial.

If you opt for vertical expansion, it’s important to acknowledge that it might necessitate suspending operations for a period. Some projects could span up to six months due to the need to dismantle the roof to add additional stories. In contrast, building outwards might have a lesser impact on daily operations if the construction area is cordoned off from the usable space.

  1. Location

The geographical location of the building can introduce certain limitations, such as proximity to property lines, which must be factored into the decision-making process. In urban areas, there are often stringent regulations governing vertical and horizontal expansions, limiting potential issues related to building proximity.

Which One’s Cheaper: Build Up or Build Out?

When deciding between building up or building out, cost is a key factor. Typically, building out is cheaper per square foot. This is because adding stories requires removing and replacing the roof, along with additional expenses like staircases, support structures, plumbing, HVAC, and permits. Plus, there’s the potential loss of revenue during construction. Building out also incurs costs like yard space loss, plumbing work, foundation pouring, permits, and HVAC upgrades. While it may seem cheaper initially, it’s important to consider all expenses before deciding.

Understanding the Expenses Associated with Constructing Additions

To make well-informed decisions, it’s crucial to grasp the intricacies involved in expanding either horizontally or vertically:

Horizontal Extensions

Expanding outward, or constructing a build-out addition, can be a wise move, especially for seldom-used outdoor areas. This approach reduces the need for extensive landscaping upkeep.

Typically, erecting a horizontal addition involves several steps. Firstly, the foundation is laid, followed by framing the walls and installing necessary electrical and plumbing infrastructure. Finally, a compatible roof is added atop the new extension. 

Harmonizing the design of the new addition with the existing structure is essential. This entails ensuring that the bricks and roofing blend seamlessly with the current exterior. Failing to achieve this cohesion may result in a disjointed appearance and functionality, which can adversely affect business operations.

Vertical Extensions

For ground-floor commercial buildings, adding an extra level involves the addition of a staircase within the existing space. This inevitably encroaches upon the floor area, diminishing the overall square footage of the property. To optimize space utilization, the staircase can be positioned near the main entrance if sufficient room is available. Alternatively, consulting with an architect can help identify an appropriate location for the new staircase installation.

Restaurants, Retail, and Convenience Stores

When deciding whether to expand a building, factors like its size, shape, design, and available land must be considered. The primary goal should always be to enhance the customer experience with any new design changes. 


Expanding a restaurant involves various considerations, including kitchen space, furniture, ventilation, electrical infrastructure, and sewer systems.

Expanding outward can involve converting large, noisy dining areas into smaller, cozier cubicles, offering patrons a more intimate dining atmosphere. Additionally, outdoor seating areas can provide customers with a refreshing outdoor dining option.

Alternatively, building upward can elevate the dining experience, adding intrigue to the business space and potentially increasing sales. 


Expanding retail space often involves distinguishing between desires and necessities. Factors such as storefronts, floor plans, and regulatory requirements play a significant role in deciding whether to expand upward or outward. 

Building upward may require installing a staircase, which can limit available floor space. However, it can create a more organized and compact appearance for the establishment. Elevators and escalators can also enhance the shopping experience.

Convenience Stores

Expanding a convenience store typically involves multiple phases, often focusing on building outward to accommodate expansions like the store itself, fuel pump areas, and canopy installations. Given the operational model of convenience stores, expanding upward is generally impractical, unless for storage purposes. 

Why Should You Consider Building Up or Building Out for Your Business? 

Inquire any business proprietor presently engaged in extending their commercial premises, and you’ll likely receive various rationales for opting to expand in either direction. Nevertheless, among the prevalent motives are as follows: 

  1. Enhancing Property Worth

When executed with proficiency and expertise, any additional construction on your commercial property will enhance its real estate valuation. 

  1. Amplifying Storage Capacity

Should your business face burgeoning demand but suffer from limited storage space for your merchandise, expanding upwards or outwards could prove beneficial. While taking into account your store’s interior and exterior aesthetics, expanding vertically or horizontally allows for the creation of a spacious warehouse or building capable of accommodating your inventory. Over time, this approach proves more economical than leasing additional storage space.

  1. Enhancing the Customer Experience

Expanding upwards or outwards could potentially boost foot traffic to your physical store. For instance, certain patrons might prefer a particular eatery due to its raised or outdoor dining area. Such enhancements grant your business a competitive advantage in the market.

Final Thoughts

A lot of folks opt for expansion due to its cost-effectiveness. However, just because it’s cheaper doesn’t mean it’s universally the optimal choice. Alongside your budget, it’s vital to consider factors such as available yard space, the nature of your business, local building regulations, and other relevant aspects.

Equally important is securing the services of a certified and respected commercial construction firm for your build-up or build-out project, such as Arrant Construction.


Why consider expansion?

Expanding can accommodate growth and meet increasing demands without relocating.

What factors should I consider before expanding?

Evaluate budget constraints, available space, business type, and adherence to building regulations.

Why choose a reputable construction company?

Experienced firms ensure quality workmanship, adherence to safety standards, and timely completion of projects.

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