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Feasibility & Viability Research

CHIEF MICHAEL ADEKUNLE AJASIN AMUSEMENT PARK

FEASIBILITY/VIABILITY RESEARCH REPORT
INTRODUCTION
This feasibility and viability report of the propose chief Michael Adekunle Ajasin
Amusement park was researched and reported by the entire Estate management class 2011/2012
graduating set. The market survey was carried out in December 2012, with the aim of evaluating
the existing market for recreational facilities in the surrounding states. The state in focus is Ondo
state where the proposed amusement park will be sited but based on professional judgment of the
research groups, it was decided that the market demand will not only be expected from ondo
state and thus 3 other states were randomly selected based on their proximity to Ondo state and
these states are Oyo, Osun and Ekiti state.
AIM OF THE PROJECT
The aim of the Project is the preparation of feasibility research concerning the siting of a
memorial amusement park named after Chief Michael Adekunle Ajasin in Ondo state. The
feasibility report or study should evaluate the forecast of cost and revenue. The cashflow analysis
should give an estimate of how long it will take for the project to pay-back the cost incurred in
its installment.

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Feasibility & Viability Research

SCOPE OF THE ASSIGNMENT

International cultural exchange Limited (INTERCEL) provides herein a report for the
Ondo state government of an estimate the potential market feasibility of the development of
Chief Michael Adekunle Ajasin Amusement Park, a proposed development which is not only to
serve as a center for recreation but as a memorial to retain the heritage of the Late sage. We
made a number of independent investigations and analyses in performing this study. We made
judgemental estimates concerning the subject site and its relationship to potential users as well as
its attributes relative to the amusement park and other recreational facility comparables. We
administered market survey questionnaires in 4 major states which are Ekiti, Oyo, Osun and
Ondo and the samples were taken randomly. We examined reports of various amusement park
developments including the major ones existing in these states which we could lay our hands
upon.
We researched information concerning the performance of each of the major components
of the project from the respondents perceptions. We interviewed representatives of area
attractions to determine usage and new supply additions. In conducting our investigation and
analysis, we relied on data retained in our office, which is updated regularly for use in all
assignments. Various agencies and databases, including the internet (Wikipedia.com) database,
were contacted for demographic data, land use policies and trends, growth estimates, and
employment data. Neighborhood data was supplemented by a physical inspection of the subject
property and the area. Cost estimates were based on professional quantity surveyors opinion of
cost as at 1996 and these values were appropriately adjusted considering the price change over
time. In addition to the subject's specific information, we have considered relevant market data in
determining the projections used in our cash flow analysis. The financial analysis was based

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Feasibility & Viability Research

primarily upon the probable operating experience of the property relative to gross operating
revenues, typical expense levels, and resultant net cash flow. Estimates of operating revenues
were based upon market data relative to industry standards and comparable properties in the
subject area. Expense levels were estimated based upon industry standards and operating
histories of similar properties.
Demographic factors
The survey was completed by 666 people. The study population was assumed to exclude minors
hence the figures from the market survey are targeted to include only age and income qualified
population which is assumed to start from age 18 and above. As seen in the table below, the
highest percentage of respondents was between 24-30 years (36.2% of the market survey). The
highest percentage of the respondents was single 52% in all and 24.8% of the respondents had
family sizes of 4 and 5 each.
Table 1: Age
18-23
24-30
31-40
41 above
Total

Frequency
162
241
144
117
664

Percent
24.3
36.2
21.6
17.6
99.7

Table 2: Marital status

Frequency
single
346
married 296
widow
11
divorced 2
others
1
Total
658

Percent
52.0
44.4
1.7
0.3
0.2
98.80

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Feasibility & Viability Research

Table 3: Family size

Frequency

Percent

2
3
4
5
others

90
110
165
165
88

13.5
16.5
24.8
24.8
13.2

Total

625

93.8

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Feasibility & Viability Research

Figure 1: Market Capture description

Main Market areas

Competing Markets

The delineation of market zones above has not been done to any scale, its only descriptive
estimate to show the proximity of the other states understudied to ondo state. The Markets
understudied are the Recreation market In Ondo state, Ekiti state, Osun state and Oyo state. The

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Feasibility & Viability Research

main market is the proposed Chief Michael Adekunle Ajasin Amusement park which will be
located in ondo state as seen above.
Market Population Analysis
Consultants have adopted a three stage methodology for market demand assessment for the
proposed recreational facility at Ondo state. Demand for any activity is a resultant of several
factors, which are sources of generation of demand. Understanding of those factors is critical for
estimation of actual demand or demand generators. Firstly the indicators and factors are
described and illustrated. In the study, the catchment area for the proposed recreational facility is
delineated. The report presents a detailed analysis of the indicators and factors affecting the
demand for the proposed recreational hub with respect to the catchment area, with an objective
of estimation of the demand generating potential of these factors.
The Population:
First and most importantly is the population resident in an area, this is a major indicator of
market demand. The greater the population of an area, the greater the likelihood that demand will
be generated in the area. This however, is still subject to varying constraints which the analysis
of the market survey has been able to put into consideration in determining total expected market
demand.
2006, Nigeria Census figures show:
Ekiti = 2,398,357 people
Ondo = 3,346,087 people
Osun = 3,416,959 people
Oyo = 5,580,894 people
Others = an Estimate of 4,000,000 average

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Feasibility & Viability Research

The process for population analysis is in three steps which are described as follows:
1. Cross-tabulations, describing, the various percentages of each state or group of regions
who expressed willingness to visit the park were applied to the population from each
state. Assumption being that the market survey is evidence enough to serve as a basis of
generalization.
2. Weighted average of frequency of visits in a year: The total percentage of the respondents
who said they would visit always, sometimes, occasionally and never were weighted by a
probability of 0.4, 0.3, 0.2 and 0.1 respectively.
3. Market pull: In this step, the respondents where divided into 5 market areas, Ondo, Ekiti,
Osun, Oyo and Others. The percentage of the population who were attracted to the
competing recreational facilities were evaluated

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Feasibility & Viability Research

Table1: Population willing to visit the park

Total
yes&no

Percentages

7
50

57

12.28
87.72

no
yes

10
93

103

9.71
90.29

no
yes

6
107

113

5.31
94.69

no
yes

11
90

101

10.89
89.11

no
yes

132

5.30
94.70

no
yes

Total
yes

Others

Ondo

Ekiti

Osun

Oyo

no
12
1
1
1
28
4
1
0
1
1
65
23
5

2
0
0
0
4
0
0
1
0
0
9
1
0

1
1
1
1
1
1
91
9
1
2
4
1
1
65
8
7
1
1
1
1
1
28
1
1
89
3
466

0
3
0
0
0
1
2
0
0
0
0
0
0
9
2
0
0
0
0
0
0
3
0
0
4
0
41

7
125
522

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Feasibility & Viability Research

replies unaccounted
506
15
Table 2: Evaluation of respondents frequency of visits

0gun
abuja
Anambra
benin
enugu
Kaduna
lagos
Lagos
Lagos st
Minna
Niger
ogun
Ogun
Others Totals
Percentage
ado
ado ekit
Ado Ekit
Ado-Ekit
Ikere
ekiti
Ekiti
Ekiti st
Oworo ek
Ekiti Total
Percentage
iabdan
ibadan
iibadan
ikire
0y0
1badan
kwara
Kwara
owo
oyo

Always%
0
0
0
0
0
0
0
1
0
0
0
0
0
0
1
1.190
0
0
0
0
0
4
0
0
0
4
3.008
0
1
0
0
0
0
0
0
0
3

Frequency of visits
Sometimes% Occasionally% Never%
2
14
7
0
1
0
0
1
0
0
0
1
0
0
1
0
1
0
0
1
0
3
24
12
1
4
5
0
1
0
0
1
0
0
0
1
0
0
1
0
0
1
6
48
29
7.143
57.143 34.524
3
1
0
0
1
0
0
1
0
2
0
0
0
1
0
30
55
20
1
7
2
1
1
2
0
1
0
37
68
24
27.820
51.128 18.045
0
1
0
9
19
9
0
0
1
1
5
1
0
1
0
0
1
0
0
0
1
0
0
1
1
0
0
29
52
17

Total

84

133

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Feasibility & Viability Research

Oyo
Oyo Total
Percentage
ife
Ejigbo
0sun
ilesa
Iresi
osun
Osun
osogbo
Osun Total
Percentage
akure
ondo
Ondo
Ondo Total

1
5
3.165
0
1
0
0
0
7
0
0
8
7.018
0
3
0
3
2.040
21
Source: Market Survey, 2013.
Competing
Facilities

0
40
25.316
0
0
0
0
0
14
3
0
17
14.912
2
16
5
23
15.646
123

Market population
attracted
12
9
4
64
14
18
109
108
36
391
10

Akure
Abuja
Delta
Lagos
North
Others
Ibadan
Ekiti
None
Osun
Captured market(%)
41.291

3
82
51.899
2
0
1
0
0
50
7
4
64
56.140
5
48
16
69
46.939
331

1
31
19.620
0
0
0
1
1
22
0
1
25
21.930
1
44
7
52
35.374
161

Percent of market pulled(%)

1.802

16.366
16.216
5.405
58.709
1.502

Uncaptured Market(%)
58.709

*Formula: Market Assessed e.g. (Oyo + Uncaptured Market ) (Other markets)

Ekiti:
Total population = 2,398,357
Step 1: 94.69% of 2,398,357
= 2,271,004

158

114

147
638

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Feasibility & Viability Research

Step 2: (3.008% * 0.4) + (27.82%*0.3) + (51.128*0.2) + (18.045*0.1)

= 1.203+8.35+10.23+1.805
= 21.59% of 2,271,004
= 490,310
Step 3: 28.228% of 490,310
= 138,405 visits from Ekiti
Ondo:
Total population = 3,346,087
Step 1: 90.291% of 3,346,087
= 3,124,835
Step 2: (2.04% * 0.4) + (15.646%*0.3) + (46.939*0.2) + (35.374*0.1)
= 0.816+4.694+9.388+3.537
= 18.435% of 3,124,835
= 576,063
Step 3: 21.022% of 576,063
= 121,100 visits from Ondo
Osun:
Total population = 3,416,959
Step 1: 89.109% of 3,416,959
= 3,044,818
Step 2: (7.018% * 0.4) + (14.912%*0.3) + (56.140*0.2) + (21.930*0.1)
= 2.807+4.474+11.230+2.193
= 20.704% of 3,044,818
= 630,399
Step 3: 20.422% of 630,399

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Feasibility & Viability Research

= 128,740 visits from Osun

Oyo:
Total population = 5,580,894
Step 1: 94.697% of 5,580,894
= 5,284,939
Step 2: (3.165% * 0.4) + (25.316%*0.3) + (51.899*0.2) + (19.620*0.1)
= 1.266+7.595+10.380+1.962
= 21.203% of 5,284,939
= 1,120,566
Step 3: 49.85% of 1,120,566
= 558,602 visits from Oyo
Others:
Average population = 4,000,000
Step 1: 87.719% of 4,000,000
= 3,508,760
Step 2: (1.190% * 0.4) + (7.143%*0.3) + (57.143*0.2) + (34.524*0.1)
= 0.476+2.143+11.429+3.452
= 17.5% of 3,508,760
= 614,033
Step 3: 50.15% of 614,033
= 307,937 visits from Other areas
Total Estimated Annual Visits = 138,405 + 121,100 + 128,740 + 558,602 + 307,937
= 1,254,784 visits per year

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Feasibility & Viability Research

Table 3: Cost estimate table

1996 QS
Estimate(#)

Cost Items
Monument, Fountain and other
Facilities
39,000,000.00
Art Gallery
90,000,000.00
Museum
100,500,000.00
V.I.P Lodge
87,000,000.00
Accomodation Suite
183,300,000.00
Administrative Block (A storey
Building)
130,200,000.00
Shopping Complex (A Storey
Building)
276,000,000.00
Multipurpose/conference Hall
83,100,000.00
Park's Clinic
42,000,000.00
Hotel
72,000,000.00
Restaurant
30,000,000.00
Sport's Block
107,700,000.00
Mechanical workshop
35,100,000.00
Fence
219,000,000.00
Sports Arena
990,000,000.00
Animal Garden
1,680,000,000.00
Saro Wiwa Parking lots
75,000,000.00
Sculptural Garden
721,200,000.00
Children Amusement Park
924,000,000.00
Adults Amusement Park
702,000,000.00
Swimming Pools
72,000,000.00
Artificial Lake
1,050,000.00
All Roads with Drainage
6,000,000.00
Power house
15,000,000.00
Electricity/ Generator/
Beautification Lights
1,200,000.00
Water Supply/ Boreholes/ Pipes
etc
9,000,000,000.00
Landscaping
210,000,000.00
Others
240,000,000.00
Total
16,132,350,000.00
Land Cost Per plot
100 Acres (6 plots per acre)
Land Cost
Agency& Legal @ 10%

11.9% inflation Adjusted

values
(#)
43,641,000.00
100,710,000.00
112,459,500.00
97,353,000.00
205,112,700.00
145,693,800.00
308,844,000.00
92,988,900.00
46,998,000.00
80,568,000.00
33,570,000.00
120,516,300.00
39,276,900.00
245,061,000.00
1,107,810,000.00
1,879,920,000.00
83,925,000.00
807,022,800.00
1,033,956,000.00
785,538,000.00
80,568,000.00
1,174,950.00
6,714,000.00
16,785,000.00
1,342,800.00
10,071,000,000.00
234,990,000.00
268,560,000.00
18,052,099,650.00

400,000.00
600.00
240,000,000.00
24,000,000.00

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Feasibility & Viability Research

Stamp duty @ 2%
Total Land Cost
Construction&Land Cost

4,800,000.00
268,800,000.00
18,320,899,650.00

Average Fee
per visit(#)

Total Returns (1,254,784

visits)

Percentage
Visit per
specific Facility
(%)

Real Return(#)

Gate Fee
Monument, Fountain and
other Facilities

100

125,478,400.00

100

125,478,400.00

100.00

125,478,400.00

67.9

85,199,833.60

Art Square

250.00

313,696,000.00

64.3

201,706,528.00

Museum

200.00

250,956,800.00

79.3

199,008,742.40

10,000.00

12,547,840,000.00

5.1

639,939,840.00

500.00

627,392,000.00

8.2

51,446,144.00

500,000.00

627,392,000,000.00

3.4

21,331,328,000.00

2,000.00

2,509,568,000.00

5.1

127,987,968.00

Sport's Block

200.00

250,956,800.00

64.3

161,365,222.40

Animal Garden

200.00

250,956,800.00

72.8

182,696,550.40

50.00

62,739,200.00

100

62,739,200.00

Sculptural Garden

150.00

188,217,600.00

100

188,217,600.00

Children Amusement Park

100.00

125,478,400.00

67.3

84,446,963.20

Adults Amusement Park

200.00

250,956,800.00

100

250,956,800.00

Swimming Pools

250.00

313,696,000.00

64.3

201,706,528.00

Artificial Lake

200.00

250,956,800.00

65.9

165,380,531.20

Games

150.00

188,217,600.00

72.1

135,704,889.60

fountain

100.00

125,478,400.00

67.1

84,196,006.40

V.I.P Lodge
Accomodation Suite
Multipurpose/conference Hall
Hotel

Saro Wiwa Parking lots

645,774,585,600.00

24,279,505,747.20

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Feasibility & Viability Research

Gross Return =

# 24,279,505,747.20

Less: Running Cost @ say 40%

Tax @

30%

Allowance for
Depreciation @

5%

Annual Maintenance 5%
Total
Net Return

80%

#19,423,604,590.00
#4,855,901,150
Approx. #4,900,000,000.

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Feasibility & Viability Research
Repayments
Year

Income (3%
growth in 2years)

Capital

Interest(21%)

Total

Interest (21%)

3,927,000,000.00

3,927,000,000.00

3,927,000,000.00

4,900,000,000.00

148,330,000.00

4,751,670,000.00

4,900,000,000.00

4,751,670,000.00

4,900,000,000.00

179,479,300.00

4,720,520,700.00

4,900,000,000.00

4,720,520,700.00

5,047,000,000.00

364,169,953.00

4,682,830,047.00

5,047,000,000.00

4,682,830,047.00

5,047,000,000.00

440,645,643.00

4,606,354,357.00

5,047,000,000.00

4,606,354,357.00

5,198,410,000.00

684,591,228.00

4,513,818,772.00

5,198,410,000.00

4,513,818,772.00

5,198,410,000.00

828,355,386.00

4,370,054,614.00

5,198,410,000.00

4,370,054,614.00

5,354,362,300.00

1,158,262,317.00

4,196,099,983.00

5,354,362,300.00

4,196,099,983.00

5,354,362,300.00

1,401,497,404.00

3,952,864,896.00

5,354,362,300.00

3,952,864,896.00

5,514,993,169.00

1,856,442,728.00

3,658,550,441.00

5,514,993,169.00

3,658,550,441.00

5,514,993,169.00

2,246,295,701.00

3,268,697,468.00

5,514,993,169.00

3,268,697,468.00

5,680,442,964.00

2,883,467,593.00

2,796,975,371.00

5,680,442,964.00

2,796,975,371.00

5,680,442,964.00

3,488,995,787.00

2,191,447,177.00

5,680,442,964.00

2,191,447,177.00

12

Capital Borrowed
18,700,000,000.00
22,627,000,000.00
22,478,670,000.00
22,299,190,700.00
21,935,020,747.00
21,494,375,104.00
20,809,783,876.00
19,981,428,489.00
18,823,166,172.00
17,421,668,768.00
15,565,226,040.00
13,318,930,339.00
10,435,462,746.00

13

-6,946,466,959.00

5,850,856,253.00

4,392,098,192.00

1,458,758,061.00

5,850,856,253.00

1,458,758,061.00

14

-2,554,368,767.00

5,850,856,253.00

5,314,438,812.00

536,417,441.00

5,850,856,253.00

536,417,441.00

15

2,760,070,045.00

0
1
2
3
4
5
6
7
8
9
10
11

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Feasibility & Viability Research

Conclusion
From the market survey report and analysis, It has been derived that subject to the assumptions
made in this report, the project should reasonably payback within the first 15years of its life. The
project derived an estimated 1,254,784 visits per year from the markets identified, and the cost of
establishing the project was estimated at #18,320,899,650.00. The Net annual return was
approximately summed up to #4,900,000,000 and based on this estimate of cost and revenue, the
pay-back period was derived to be 15 years.