If you are buying a car you can go to Kelly Blue Book to consult pricing…
If you are buying a house you could go to Zillow to look up home values…
Where can you go if you are assessing a one of a kind behemoth?
There is an icon that has withstood the test of time for almost a century. It is an engineering muse representing the new American west…
Let’s see what the Golden Gate Bridge is worth…
I have appraised the Golden Gate bridge in a former life. Today I will share with you my process on how I go about valuing an iconic monument…
Let’s get the basics down first…
The total length of the bridge is 9000 feet or 1.7 miles. The span is about 4200 feet and the deck is 90 foot wide. It is 220 feet above the water and serves over 100,000 commuters between San Francisco and Marin and North Bay Counties daily.
Also Read: Eiffel Tower Facts.
It was part of President Franklin Roosevelt’s New Deal promise for a better America during the Great Depression…
Construction took five years and was completed in 1937 for then staggering cost of $35M. If we inflation adjusts that to today’s value using Consumer Price Index, we get $670M. The Golden Gate Bridge attracts more than ten million visitors annually. Visitors translate into revenue and revenue translates to value.
Its annual revenue is $145M. The Golden Gate Bridge District spends $85M in annual maintenance, turning a healthy profit of $60M.
Where else can you make a profit of $60M a year?
To make $60M in dividends, we will have to buy almost $800M worth of ATT stock. Or a commercial building like the Salesforce Tower worth $1.2 billion. Or we have to buy $1.5 billion worth of 30 years government bonds.
If you had that kind of money, would you buy ATT, or bonds, or an office tower, or the Golden Gate Bridge?
I estimate as a business, the Golden Gate Bridge is worth $1-1.5 billion.
Another way to consider the bridge’s value is to compare it to other bridges around the world. The problem is the cost of massive construction projects is dependent on local topography, geo politics, and macroeconomics.
The most relevant comparison to the Golden Gate Bridge would be the east span of the Bay Bridge which is only four miles away. It cost $6.4 billion in 2013 to replace 2.2 miles. In today’s dollars that comes to $9 billion.
I think it would cost $10 billion to rebuild the Golden Gate Bridge.
The breakdown is –
- Design, Planning, and Permits – $200M
- Sitework and Foundation – $2B
- Materials – $2B
- Labor – $3B
- Equipment and Transport – $1.5B
- Insurance and Administration – $1B
- Miscellaneous and Incidentals – $300M
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The people who would rebuild the Golden Gate bridge are no less than frontline soldiers. They would be working in the icy and corrosive salt water of the Pacific, with death-defying currents below, under hurricane-force winds, and dense fog. And given today’s political, social, and environmental climate, we would attempt to replicate the essence of the original Golden Gate Bridge while using the latest designs and materials. All factors add to its mystique and unforgiving conditions.
Great monuments like the Empire State Building, or The Great Wall of China, or Saint Peter’s Basilica are both functional and symbolic. The Golden Gate bridge is the artery of America’s west coast, and a symbol of the beginning and the end of a journey.