Académique Documents
Professionnel Documents
Culture Documents
Group Members:
Danielle Yoong Li Ping
0317206
Ng Wei Lin
0316302
0310592
0314411
0316919
0310908
0311907
0310629
PROPOSED DEVELOPMENT OF 26' X 80' D/S SHOP OFFICE LOTS, 22' X 75' D/S TERRACE HOUSES
AND 20' X 60' D/S LOW COST HOUSES IN RAWANG SELANGOR
Q1 Land Size : 10 acres 1 rood 10 pole
Development area @ 60%
Type
Double story shop/office lots
Double storey terrace houses
Double storey Low Cost Houses
0.60
Lot Size
26' x 80'
22' x 75'
20' x 60'
A Calculation
Ai) Land size (sq ft)
1 acres
1 rood
1 pole
43,560.00 sq ft
10,890.00 sq ft
272.25 sq ft
435,600.00
10,890.00
2,722.50
449,212.50
= RM15 x 449,212.50 sq ft
sq ft
sq ft
sq ft
sq ft
RM 6,738,187.50
269,527.50 sq ft
26' x 80'
Lot Size
8.00 Unit
1.00 Unit
2,080.00 fs
Corner
add ratio
Total ratio for a block
Average unit ratio
Thus required area for one lot
1.00 Unit
20'/26'
0.77
10.77
1.08
2,240.00
=10.77/10
= 2,080 x 1.08
= 15% x 269,527.50 sq ft
= 40,429.13 / 2,240 fs
40,429.13
18.05
18.00
1.80
2.00
multiplier
multiplier
multiplier
fs
sq ft
units
units
blocks
blocks
22' x 75'
Lot Size
= 55% x 269,527.50 sq ft
= 148,240.13 / 1,775 fs
1,650.00 fs
10.00 Unit
1.00 Unit
1.00 Unit
= 20'/22'
0.91
12.91
1.08
1,775.00
=10.91/12
= 1,650sq ft x 0.91
148,240.13
83.52
83.00
6.92
7.00
multiplier
multiplier
multiplier
fs
sq ft
units
units
blocks
blocks
20' x 60'
Lot Size
1,200.00 fs
13.00 Unit
1.00 Unit
1.00 Unit
= 15'/20'
0.75 multiplier
15.75 multiplier
=15.75/15
= 1,200sq ft x 1.05
= 30% x 269,527.50 sq ft
= 80,858.25 / 1,260 fs
1.05 multiplier
1,260.00 fs
80,858.25
64.17
64.00
4.27
5.00
sq ft
units
units
blocks
blocks
PROPOSED DEVELOPMENT OF 26' X 80' D/S SHOP OFFICE LOTS, 22' X 75' D/S
TERRACE HOUSES AND 20' X 60' D/S LOW COST HOUSES IN RAWANG SELANGOR
Summary
Units to be Built
Double Storey Shop Office
Type of Development
Total Units
Total Blocks
Intermediate
End
Corner
Units
18.00
2.00
14.00
2.00
2.00
Units
83.00
7.00
69.00
7.00
7.00
Units
64.00
5.00
54.00
5.00
5.00
TOTAL UNITS
165.00
PROPOSED DEVELOPMENT OF 26' X 80' D/S SHOP OFFICE LOTS, 22' X 75' D/S TERRACE HOUSES
AND 20' X 60' D/S LOW COST HOUSES IN RAWANG SELANGOR
Gross Development Value
Selling Price
Q2
1
Type
Double Storey Shop Office
Intermediate
End
Corner
Double Storey Terrace Houses
Intermediate
End
Corner
Low Cost Houses
Intermediate
End
Corner
Total GDV before discount
Bumiputra reservation (30%)
less Bumiputra discount (7%)
* Assume the reservation is for all types of development
Total Gross Development Value
Units
GDV
RM 850,000.00
RM 1,000,000.00
RM 1,600,000.00
14
2
2
RM 11,900,000.00
RM 2,000,000.00
RM 3,200,000.00
RM
RM
RM
400,000.00
500,000.00
650,000.00
69
7
7
RM 27,600,000.00
RM 3,500,000.00
RM 4,550,000.00
RM
RM
RM
45,000.00
45,000.00
45,000.00
54
5
5
RM 2,430,000.00
RM
225,000.00
RM
225,000.00
RM 55,630,000.00
RM 16,689,000.00
RM (1,168,230.00)
RM 54,461,770.00
PROPOSED DEVELOPMENT OF 26' X 80' D/S SHOP OFFICE LOTS, 22' X 75' D/S TERRACE HOUSES
AND 20' X 60' D/S LOW COST HOUSES IN RAWANG SELANGOR
Gross Development Cost
Q2
RM
1 Land Cost
10 arces
1 rood
10 pole
435,600.00
10,890.00
2,722.50
449,212.50 RM 15 sq/ft
Total Land Cost
2 Building Cost
2a Double Storey Shop Office
Intermediate
End
Corner
2b Double Storey Terrace Houses
Intermediate
End
Corner
2c Low Cost Houses
Intermediate
End
Corner
Total Building Cost
Earth Works
Infrasturcture costs
3 Administrative Fees
Professional Fees
Administrative Fees
Plan Fees
Contributions & Fees
Advertisement & Marketing
Conversion
Effective development area : 60%
15% commercial
85% residential
Conversion premium - commercial
Conversion premium - residential
Subdivision
Legal Fees
4 Finance Cost
Cost of finance for Construction
5.5% p.a + BLR 6.5%
Interest on loan for purchase of land
2.5% p.a + BLR 6.5%
5 Contingencies
6,738,187.50
14
2
2
Built-up Area
Construction Cost
3,600.00 RM
70.00
3,600.00 RM
80.00
6,500.00 RM
80.00
69
7
7
1,500.00 RM
1,500.00 RM
1,500.00 RM
75.00
85.00
85.00
7,762,500.00
892,500.00
892,500.00
54
5
5
900.00 RM
900.00 RM
900.00 RM
35.00
40.00
40.00
1,701,000.00
180,000.00
180,000.00
16,752,500.00
837,625.00
1,675,250.00
19,265,375.00
5% of building cost
10% of building cost
Total Construction Cost
9% of construction costs.
2% of GDV
RM2,000.00 per unit
2% of construction costs
1% of GDV
165 units
RM
4,042,912.50
RM
606,436.88
RM
3,436,475.63
20% of land value of commercial lots
15% of land value of residential lots
RM1,500.00 per unit
165 units
RM2,500.00 per unit
165 units
Total Administrative Fees
RM
3,528,000.00
576,000.00
1,040,000.00
1,733,883.75
1,089,235.40
330,000.00
385,307.50
544,617.70
121,287.38
515,471.34
247,500.00
412,500.00
5,379,803.07
9,632,687.50
2,311,845.00
6,500,000.00
Total Financing Cost
5% of construction costs
3,501,055.71
5,812,900.71
963,268.75
RM
38,159,535.03
Description
Sales Projection
1 Double Storey Shop/ Office
2 Double Storey Terrace
3 Double Storey Low Cost
Monthly Total
% of cumulative sales
Week
Amount
30.7%
64.1%
5.2%
100.0%
Q1
M1
16,740,900
34,901,350
2,819,520
54,461,770
M2
10%
30%
22.3%
22.3%
Item
Description
1
2
3
4
5
6
7
8
9
10
11
12
13
ITEM
Week
Amount
3
9
7
7
8
5
6
2
M4
22.3%
M5
22.3%
M1
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
M2
22.3%
7.4%
M6
7.4%
M4
7.4%
2.5%
M5
2.5%
M8
38.2%
M6
2.5%
M9
M10
10%
20%
50%
18.5%
56.7%
M11
56.7%
M8
5.1%
5.5%
Q1
M12
M13
10%
10%
9.5%
66.2%
56.7%
Q3
M7
15.9%
15.9%
5.1%
Q4
38.2%
2013
Q2
M3
Q3
M7
10%
20%
15.9%
38.2%
22.3%
Q1
M14
66.2%
M10
18.5%
18.5%
11.3%
9.2%
8.1%
5.1%
5.5%
M11
11.3%
9.2%
8.1%
M16
10%
20%
50%
18.5%
84.6%
66.2%
Q4
M9
M15
Q2
M17
84.6%
Q1
M12
M13
9.5%
9.5%
9.5%
13.9%
10.5%
8.4%
11.3%
9.2%
8.1%
7.1%
M14
13.9%
10.5%
8.4%
M15
10.5%
8.4%
13.1%
M18
2 FOUNDATION
10.0%
5,446,177
3 RC. FRAMEWORK
15.0%
8,169,266
10.0%
5,446,177
10.0%
5,446,177
10.0%
5,446,177
7 SEWERAGE WORKS
5.0%
2,723,089
8 DRAINAGE WORKS
5.0%
2,723,089
9 ROADWORKS
5.0%
2,723,089
12.5%
6,807,721
11 MEMORANDUM OF TRANSFER
2.5%
1,361,544
2.5%
1,361,544
2.5%
1,361,544
54,461,770
90.8%
2014
M18
13.1%
14.1%
15.3%
M22
30%
9.2%
100.0%
M23
100.0%
M20
18.2%
15.3%
M24
100.0%
Q3
M19
6.1%
6.1%
6.1%
6.1%
6.1%
19.2%
100.0%
Q4
M21
M22
9.2%
9.2%
9.2%
9.2%
9.2%
9.2%
21.2%
19.9%
18.2%
15.3%
M23
21.2%
19.9%
M24
M25
Q1
M26
2015
Q3
M31
2016
Q3
M43
21.2%
50.0%
100.0%
100.0%
2013
5,446,177
90.8%
Q4
M21
100.0%
Q1
10.0%
M20
100.0%
M1
1 SIGNING S&P
Q3
M19
20%
6.1%
90.8%
84.6%
Q2
M17
M16
18.5%
18.5%
18.5%
18.5%
28.9%
13.1%
2014
50.0%
DESCRIPTION OF WORKS
M3
22.3%
2013
Q2
22.3%
1,214,497
7.4%
404,832
M2
7.4%
404,832
2014
Q2
M3
7.4%
404,832
2.5%
204,232
M4
M5
2.5%
204,232
2.5%
204,232
Q3
M6
15.9%
865,942
15.9%
865,942
5.1%
416,633
M7
5.1%
416,633
5.5%
297,127
M8
Q4
M9
18.5%
1,007,543
18.5%
1,007,543
5.1%
11.3%
416,633
923,127
5.5%
9.2%
297,127
498,409
8.1%
441,140
M10
11.3%
923,127
9.2%
498,409
8.1%
441,140
M11
11.3%
923,127
9.2%
498,409
8.1%
441,140
7.1%
386,679
Q1
M12
9.5%
517,387
9.5%
517,387
9.5%
776,080
13.9%
756,620
10.5%
571,849
8.4%
457,479
M13
13.9%
756,620
10.5%
571,849
8.4%
457,479
M14
M15
18.5%
1,007,543
18.5%
1,007,543
18.5%
1,511,314
18.5%
1,009,062
10.5%
28.9%
571,849 1,573,945
8.4%
13.1%
457,479
713,449
M16
13.1%
713,449
Q2
M17
2015
Q3
M18
M19
M20
6.1%
332,217
6.1%
332,217
6.1%
498,325
6.1%
333,347
6.1%
332,217
13.1%
19.2%
713,449 1,045,666
14.1%
384,094
15.3%
417,576
18.2%
494,395
15.3%
417,576
18.2%
494,395
15.3%
417,576
Q4
M21
9.2%
501,048
9.2%
501,048
9.2%
751,572
9.2%
501,048
9.2%
501,048
9.2%
501,048
21.2%
578,100
19.9%
543,133
M22
21.2%
578,100
19.9%
543,133
M23
M24
M25
Q1
M26
Q3
M31
2016
Q3
M43
21.2%
578,100
50.0%
1,361,544
50.0%
1,361,544
100.0%
6,807,721
100.0%
1,361,544
100.0%
1,361,544
1,619,330
404,832
609,064
204,232
204,232
2,148,517
713,759
713,759
3,877,762
1,862,676
2,249,355
3,596,801
1,785,948
1,029,327
6,822,856
713,449
1,097,544
3,291,565
911,971
911,971
4,378,046
1,121,232
1,939,644
1,361,544
6,807,721
1,361,544
1,361,544
100.0%
1,361,544
1,361,544
CASH OUTFLOW
2013
ITEM
DESCRIPTION OF WORKS
WEEK
AMOUNT
Q1
1
1 EARTHWORKS
5%
837,625.00
2 FOUNDATION
3 10%
1,675,250.00
3 RC. FRAMEWORK
9 25%
4,188,125.00
7 15%
2,512,875.00
7 15%
2,512,875.00
2014
Q2
2
558,416.67
558,416.67
Q3
Q4
Q1
10
11
12
465,347.22
465,347.22
465,347.22
465,347.22
465,347.22
465,347.22
465,347.22
465,347.22
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
Q2
13
14
15
16
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
358,982.14
314,109.38
314,109.38
314,109.38
314,109.38
314,109.38
Q3
17
18
19
314,109.38
314,109.38
314,109.38
2015
Q1
Q4
20
21
22
23
24
167,525.00
167,525.00
167,525.00
167,525.00
167,525.00
139,604.17
139,604.17
139,604.17
139,604.17
25
26
27
837,625.00
558,416.67
465,347.22
8 15%
2,512,875.00
7 SEWERAGE WORKS
5%
837,625.00
8 DRAINAGE WORKS
5%
837,625.00
9 ROADWORKS
2 10%
1,675,250.00
6 10%
1,675,250.00
139,604.17
10 INFRASTRUCTURE WORKS
TOTAL
RETENSION SUM 10%, LIMIT 5%
CUMULATIVE RETENTION SUM
TOTAL PAYMENT
* Work Programme
* Payment
19,265,375.00
963,268.75
1,396,041.67
139,604.17
139,604.17
1,256,437.50
558,416.67
55,841.67
195,445.83
502,575.00
1,023,763.89
102,376.39
297,822.22
921,387.50
465,347.22
46,534.72
344,356.94
418,812.50
465,347.22
46,534.72
390,891.67
418,812.50
465,347.22
46,534.72
437,426.39
418,812.50
824,329.37
82,432.94
519,859.33
741,896.43
824,329.37
82,432.94
602,292.26
741,896.43
1,183,311.51
118,331.15
720,623.41
1,064,980.36
1,183,311.51
118,331.15
838,954.56
1,064,980.36
1,497,420.88
124,314.19
963,268.75
1,373,106.69
139,604.17
837,625.00
837,625.00
1,032,073.66
1,032,073.66
673,091.52
673,091.52
279,208.33
593,317.71
279,208.33
732,921.88
279,208.33
732,921.88
279,208.33
586,337.50
279,208.33
586,337.50
279,208.33
586,337.50
307,129.17
1,005,150.00
837,625.00
1,032,073.66
1,032,073.66
673,091.52
673,091.52
593,317.71
732,921.88
732,921.88
586,337.50
586,337.50
586,337.50
307,129.17
1,005,150.00
837,625.00
Description
Amount
M1
CASH INFLOW
1 Bank Loan for Land
Repayment
2 Sales Projection
1
2
3
4
5
6
7
8
9
10
11
12
13 Contigencies
Total Monthly Outflow
CUMULATIVE OUTFLOW
SURPLUS / DEFICIT
6,500,000.00
(6,500,000.00)
54,461,770.00
6,500,000.00
54,461,770.00
6,500,000.00
6,500,000.00
6,738,187.50
19,265,375.00
1,733,883.75
1,089,235.40
330,000.00
385,307.50
544,617.70
6,738,187.50
Q1
M2
M3
M4
Q2
M5
M6
M7
Q3
M8
M9
M10
Q4
M11
M12
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
121,287.38
515,471.34
247,500.00
412,500.00
2,311,845.00
3,501,055.71
58,350.93
963,268.75
38,159,535.03
16,302,234.97
42.72%
6,796,538.43
6,796,538.43
(296,538.43)
58,350.93
6,854,889.36
(58,350.93)
58,350.93
6,913,240.29
(58,350.93)
58,350.93
6,971,591.21
(58,350.93)
58,350.93
7,029,942.14
(58,350.93)
58,350.93
7,088,293.07
(58,350.93)
58,350.93
7,146,644.00
(58,350.93)
58,350.93
7,204,994.93
(58,350.93)
58,350.93
7,263,345.86
(58,350.93)
58,350.93
7,321,696.78
(58,350.93)
58,350.93
7,380,047.71
(58,350.93)
58,350.93
7,438,398.64
(58,350.93)
2011
M1
Q1
M2
M3
M4
Q2
M5
M6
M7
Q3
M8
M9
M10
Q4
M11
M12
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
7,496,749.57
(58,350.93)
58,350.93
7,555,100.50
(58,350.93)
58,350.93
7,613,451.43
(58,350.93)
58,350.93
7,671,802.36
(58,350.93)
58,350.93
7,730,153.28
(58,350.93)
58,350.93
7,788,504.21
(58,350.93)
58,350.93
7,846,855.14
(58,350.93)
58,350.93
7,905,206.07
(58,350.93)
58,350.93
7,963,557.00
(58,350.93)
58,350.93
8,021,907.93
(58,350.93)
58,350.93
8,080,258.85
(58,350.93)
58,350.93
8,138,609.78
(58,350.93)
2012
M1
Q1
M2
M3
M4
Q2
M5
M6
M7
Q3
M8
M9
M10
Q4
M11
M12
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
6,500,000.00
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
58,350.93
8,196,960.71
(58,350.93)
58,350.93
8,255,311.64
(58,350.93)
58,350.93
8,313,662.57
(58,350.93)
58,350.93
8,372,013.50
(58,350.93)
58,350.93
8,430,364.42
(58,350.93)
58,350.93
8,488,715.35
(58,350.93)
58,350.93
8,547,066.28
(58,350.93)
58,350.93
8,605,417.21
(58,350.93)
58,350.93
8,663,768.14
(58,350.93)
58,350.93
8,722,119.07
(58,350.93)
58,350.93
8,780,470.00
(58,350.93)
58,350.93
8,838,820.92
(58,350.93)
2013
M1
Q1
M2
M3
M4
Q2
M5
M6
M7
Q3
M8
M9
M10
Q4
M11
M12
1,619,329.96
404,832.49
609,064.10
204,231.60
204,231.60
2,148,516.80
713,759.00
713,759.00
3,877,761.70
1,862,676.20
2,249,354.80
3,596,801.46
1,619,329.96
8,119,329.96
404,832.49
8,524,162.45
609,064.10
9,133,226.55
204,231.60
9,337,458.15
204,231.60
9,541,689.75
2,148,516.80
11,690,206.55
713,759.00
12,403,965.55
713,759.00
13,117,724.55
3,877,761.70
16,995,486.25
1,862,676.20
18,858,162.45
2,249,354.80
21,107,517.25
3,596,801.46
24,704,318.71
1,256,437.50
502,575.00
921,387.50
418,812.50
418,812.50
418,812.50
741,896.43
741,896.43
1,064,980.36
1,064,980.36
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
1,373,106.69
346,776.75
45,384.81
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
3,315,287.68
12,154,108.61
(1,695,957.72)
1,519,328.71
13,673,437.32
(1,114,496.22)
681,703.71
16,986,589.68
1,466,813.09
681,703.71
17,668,293.39
32,055.29
1,004,787.64
19,677,868.67
2,872,974.06
1,327,871.57
21,005,740.25
534,804.63
1,327,871.57
22,333,611.82
921,483.23
1,982,774.66
24,316,386.48
1,614,026.80
1,040,330.25
45,384.81
330,000.00
385,307.50
22,692.40
121,287.38
515,471.34
247,500.00
412,500.00
765,466.21
14,438,903.53
(156,402.11)
1,184,278.71
15,623,182.25
(980,047.11)
681,703.71
16,304,885.96
(477,472.11)
1,004,787.64
18,673,081.03
(291,028.64)
2014
M13
Q1
M14
M15
M16
Q2
M17
M18
M19
Q3
M20
M21
M22
Q4
M23
M24
1,785,947.60
1,029,327.45
6,822,856.18
713,449.20
1,097,543.50
3,291,564.58
911,971.10
911,971.10
4,378,046.20
1,121,232.38
1,939,643.75
1,361,544.25
1,785,947.60
26,490,266.31
1,029,327.45
27,519,593.76
6,822,856.18
34,342,449.94
713,449.20
35,055,899.14
1,097,543.50
36,153,442.64
3,291,564.58
39,445,007.22
911,971.10
40,356,978.32
911,971.10
41,268,949.42
4,378,046.20
45,646,995.62
1,121,232.38
46,768,228.00
1,939,643.75
48,707,871.75
1,361,544.25
50,069,416.00
1,032,073.66
1,032,073.66
673,091.52
673,091.52
593,317.71
732,921.88
732,921.88
586,337.50
586,337.50
586,337.50
307,129.17
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
45,384.81
1,005,150.00
346,776.75
45,384.81
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
22,692.40
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
96,326.88
58,350.93
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
40,136.20
856,208.92
29,634,490.61
241,334.58
995,813.09
30,630,303.70
2,295,751.49
849,228.71
32,475,345.50
62,742.39
849,228.71
33,324,574.22
3,528,817.49
849,228.71
34,173,802.93
272,003.67
570,020.38
34,743,823.31
1,369,623.37
1,294,964.87
25,611,351.35
490,982.73
1,294,964.87
26,906,316.22
(265,637.42)
935,982.73
27,842,298.96
5,886,873.45
935,982.73
28,778,281.69
(222,533.53)
995,813.09
31,626,116.79
(83,841.99)
1,614,817.96
36,358,641.27
(253,273.71)
2015
M25
Q1
M26
M27
Q2
M29
M28
M30
M31
Q3
M32
M33
Q4
M35
M34
M36
(6,500,000.00)
6,807,721.25
1,361,544.25
1,361,544.25
307,721.25
50,377,137.25
1,361,544.25
51,738,681.50
51,738,681.50
1,361,544.25
837,625.00
481,634.38
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
1,361,544.25
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
837,625.00
37,196,266.27
(529,903.75)
481,634.38
37,677,900.65
879,909.88
2016
Q1
M38
M37
M39
Q2
M41
M40
M42
M43
Q3
M44
M45
Q4
M47
M46
M48
1,361,544.25
1,361,544.25
481,634.38
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
1,361,544.25
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
37,677,900.65
-
481,634.38
38,159,535.02
(481,634.38)
Q4. With a twelve percent (12%) cost of capital, tabulate and calculate the NPV of the
project on a quarter-yearly basis. Give an overall analysis and comment on the viability
of the project.
Year
2010
2011
2012
2013
2014
2015
2016
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
6,500,000.00
2,633,226.58
2,556,980.00
5,305,279.70
7,708,832.46
9,638,131.23
5,102,557.28
6,201,988.40
4,422,420.38
1,669,265.50
1,361,544.25
1,361,544.25
54,461,770.00
6,913,240.29
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
175,052.79
5,600,082.61
2,547,686.14
2,691,279.00
4,638,517.80
3,525,912.48
2,788,004.74
2,694,270.52
3,034,067.06
1,319,259.38
481,634.38
38,159,535.03
(413,240.29)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(175,052.79)
(2,966,856.07)
9,293.86
2,614,000.70
3,070,314.66
6,112,218.75
2,314,552.54
3,507,717.88
1,388,353.32
350,006.12
1,361,544.25
1,361,544.25
(481,634.38)
16,302,234.97
Table 4.0 Net Present Value (NPV) of the Project on a Quarter-Yearly Basis
The project is viable due to its positive net present value of RM 12,490,782.69. It
means that the investor is paying less than what the development is worth, indicating a better
return in the future. By paying RM 12,490,782.69 today, the project is able to generate a
future cash flow of
When rate of return is taken into consideration, this investment is able to generate
42.72% of profit gained on the investment. With 42.72% rate of return, this means that the
investor is able to recover his initial cost of investment of RM 38,159,535.03 in 2 years and 4
months time.
Form Table 4.0, there is cash deficits from year 2010 to 2012 due to the purchase and
financing of the land purchase while there arent any developments on the land itself. Also,
there is a huge amount of capital outflow on the first quarter of 2013 when development order
has been granted and construction is commenced. Hence, external funding is required by the
client to finance the development cost during these periods. The cash flows then become
positive when there is cash inflows by selling off the units while the construction proceeds.
By that time, the client is able to finance the development cost by using the cash inflows from
sales and paying back the bank interest rate for borrowings at the same time.
Q5. Comment on the cash flow and viability of the project if it is based on a Build-then
Sell concept. (Assume 100% sales on completion of construction).
Introduction
In April 2007, Malaysia government implemented and introduced Build Then Sell
system which was proposed by previous Prime Minister of Malaysia, Tun Abdullah Bin Ahmad
Badawi. The BTS system can prevent the problem of abandoned projects where this system
can promote better quality of house and provide greater protection for home buyers. Developers
are required to build and complete their project before selling the completed house to home
buyers upon Certificate of Compliance and Completion (CCC).
There have two types of build then sell system applied such as, completed build then
sell 0:100 and partial build then sell 10:90. Partial build then sell is implemented in Malaysia
since 1st December 2007. The home buyers will pay 10% deposit upon signing the Sale and
Purchase Agreement with the developer and the balance of 90% is made upon completion of
the house with CCC. Housing Development (Control and Licensing) Act 1996 and Regulation
was also amended to accommodate with this new system delivered.
The sell then build system required the home buyer to pay 10% of the purchase price
upon the signing of the Sale and Purchase Agreement (SPA) and the 90% is progressively paid
to the developer in accordance to the construction stage. In this system, the developers are
financed by the home buyer where developer do not need to get more loan to finance his
projects. The home buyers have to get loan from bank to pay to developer for the property that
is incomplete. This may have disadvantages for the home buyer because it will cause loss to
home buyer when the project is abandoned.
The build then sell concept implemented whereby the developer will not finance by the
sales from home buyers. Developer have to obtain financing aid from the bank to finance the
projects up to completion of projects. Bank sector will play a major role in providing finance
up to the completion stage of projects and increasing the banks risk exposure. From
conventional point of view, the bank prefers to lend money to individual buyer rather than
lending to developer in one parcel.
Items
Percentage of project
Low
High
abandoned
Developer Finance Factor
before sell
workmanship
There have few criteria that require developer to fulfill with the implementing of Build Then
Sell concept. As in this concept the developer has to base on their financial capital and capacity
to carry out project on their own without financing from home buyers. The developer has to
apply more financing from financial institution or their own capital or both to cover all the cost
in projects. On the other hand, there is no progressive payment from home buyer resulting the
developers required higher bridging loans to finance projects and causing the financial
institution or bank increase risk which mean increase the loan pricing.
When apply financing loan and approve of loan the developer and banker have to understand
the housing market before embarking into any development and would cautions into
committing speculative projects. In this system, the developers and bankers have to bear the
overall development risks. Besides, developer have difficulties in applying financing loan
under bridging finance because the banks will only approve to the experienced developers who
have good track record and adequate financial strength. The smaller developer has
disadvantages on this system where they are weak in financial and track record to carry on the
projects.
Thus the developer needs to have or borrow this amount of money in order to proceed
with the development. In the event the developer is not able to pay the contractor for the interim
payment, the progress of the work may be affect or if the developer decides to cut cost due to
the low level of cash, the quality of the building will be affected. A building with of low quality
will eventually not attract the attention of the potential buyers.
Since all units are sold out completely upon completion of the construction, there will
be a large amount of cash inflow. The developer can then pay off their debt from the bank or
other external funds and can earn their profit for the development. However, as compared to
STB, the gross profit from the development may not be as much for BTS as more financing
cost for the borrowing will be incurred which reduces the net cash flow. Thus the development
is still viable to continue provided that the developer fulfills the requirement; however not as
viable as compared to STB.