Separating Utilities in a Multi Family Property

The cost of separating utilities in a multi-family property can vary significantly based on several factors, including the type of utilities (electric, gas, water), the building’s layout, local labor rates, and code requirements. Here’s a breakdown to help you estimate:

• Electricity

  • Typical cost per unit: $3,000 – $10,000+

  • What’s involved:

  • New electrical panels/meters for each unit

  • Wiring upgrades, trenching (if needed), coordination with utility company

  • Permits and inspections

• Gas

  • Typical cost per unit: $2,000 – $7,500+

  • What’s involved:

  • Installing new gas meters and supply lines

  • New HVAC/water heater hookups per unit

  • Coordination with gas provider

  • Potential code upgrades to appliances or venting

• Water & Sewer

  • Typical cost per unit: $5,000 – $15,000+
    (Often the most expensive to separate)

  • What’s involved:

  • Separate water meters (municipal approval required)

  • Repiping supply and waste lines

  • Excavation if needed (for underground separation)

  • Backflow prevention, inspections, and utility coordination

• Other Costs

  • Permits: $500 – $3,000 depending on jurisdiction

  • Architect/Engineer plans (sometimes required): $1,000 – $5,000+

  • Restoration work (drywall, patching, painting): variable

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Ballpark Total Estimates

“High End” is an estimate and could cost more.

• Considerations Before You Start

  • Check zoning/building codes: Some areas require full code upgrades when making these changes.

  • HOA or deed restrictions (for condos) may limit your ability.

  • Rental income gains: Separate utilities often increase property value and ease landlord-tenant relations.

  • Alternative: Consider submetering (especially for water) if full separation is too expensive.

• Cost Savings

  • Separating utilities can help property owners recover more of their utility costs by allowing them to bill tenants directly for their usage. 

  • This can lead to significant monthly savings, especially for large properties with high utility expenses. 

  • However, the initial investment in separating utilities may not be cost-effective for smaller buildings or those with low utility bills