Your business’s commercial HVAC is one of the most critical systems in your building. It’s a necessity to keep customers and employees comfortable year-round, and there’s no way to get out of maintaining, repairing, and replacing the system. A commercial HVAC system is also one of a business’s largest investments, generally costing $17-$28 per square foot for new installation and roughly half that for replacement as long as ductwork, plumbing, and other components are still in good shape.
You know that preventative maintenance is the best way to extend the life of your HVAC system and fix minor issues before they lead to major repairs or system failure. But aside from total failure, how do you decide when to stop repairing your system and replace it? There’s no magic answer, but there are some factors that can help you evaluate commercial HVAC repair versus replacement.
How Old Is Your HVAC System?
In general, if your system is less than 10 years old and in good working order, it makes sense to have a preventative maintenance schedule in place and to pay for minor repairs as they arise. If your system is 15-20 years old, start keeping a close eye on repair costs and plan for replacement in the near future.
Remember too that newer systems are more energy-efficient. Use this calculator to compare your current electricity expenses to your expenses with a more efficient model. This can help you decide your company’s tipping point for energy savings and when an upgrade makes sense.
The caveat to this is if your system is not appropriately sized for your business, or if it has been seriously neglected. In these cases you’re likely overpaying for electricity and repairs, so you could be forced to replace the system sooner.
How Much Money Are You Currently Spending On Maintenance & Repairs?
Regular HVAC maintenance costs should be worked into your annual facilities budget. In general, a commercial HVAC maintenance contract costs around $150-$500 per year and includes an annual inspection and tune-up. Repairs are extra, and generally cost around $100 for labor plus the cost of parts. Your location, facility size, and number of units all affect the cost.
If you’ve always used the same HVAC company, they should keep a log of maintenance and repairs. It’s a good idea to keep an eye on costs and watch for an upward trend. Generally, if you are faced with a major repair that’s going to cost more than 50% of a new system, replacement is recommended. The same goes for a lot of small repairs throughout the year – if they’re adding up to more than half the cost of a new system, it’s time to consider replacement.
Another factor is how much downtime you’re experiencing when repairs are being made. If you’re consistently losing business throughout the year when you have to close for repairs, you need to factor those losses into repair costs.
How Has Your System Been Maintained?
This is a huge factor when evaluating commercial HVAC repair versus replacement. A well-maintained system should last 15-20 years. Businesses that practice reactive maintenance and wait for problems to arise may only get 10 years out of their system. The saying ‘hindsight is 20/20’ rings true when you consider that tens of thousands of dollars for replacement could have been forestalled for 5-10 more years with simple – and affordable – preventative maintenance.
This post explains some of the most common commercial HVAC problems and how preventative maintenance can avoid them.
What’s In The Budget?
HVAC replacement is inevitable, eventually. But the reality is that some years are better than others for major expenditures. While you can’t always control a complete system failure, if your system is getting toward the end of its useful life, start planning for replacement. It’s always ideal if you can control what year you invest in replacement so that you can stagger it with other large capital expenditures.
Evaluate Your Business’s Needs
When you do decide that replacement is necessary, don’t automatically replace your system with what you currently have. First, make sure that your HVAC system is appropriately sized for your facility and any additions or changes you’ve made over the years. Look at more energy-efficient models and compare your lifetime savings if you upgrade to a better system. Finally, evaluate whether a rooftop unit or ground unit makes more sense given your location, proximity to other businesses, and which is more cost-effective.
Need Help Evaluating?
National Fiduciary Services has your back! In addition to providing reliable HVAC maintenance contract services 24/7/365, our trusted local technicians can evaluate your facility’s existing HVAC system and make a recommendation for repair versus replacement.
While we always recommend a preventative maintenance schedule as your first line of defense against system failure, we know that replacement is inevitable. When it comes to that time, we’re here to help you find a technician you can trust!
Get in touch with any of our amazing team members who are standing by ready to serve! Call (505) 591-5200 to learn more.