Test

Assumptions:

Description Assumptions
Capital contribution to local
Authority
a) IWK 1.65% of total income
b) CIDB levy 0.125% of construction cost
c) Professional fees 10% of construction cost + 5% tax
d) Management cost 2% of construction cost
e) Legal feel 1% of selling price
f) Sales fees 1% of selling price
Total GDV is based on 100% return from original sale
No detail design Need to assume an appropriate current price for M&E
costs.
Building cost is inclusive of M%E installation.
Preliminaries 5% of construction cost
Contingencies cost 8% of construction cost
GFA
Double- storey terraced factories 400m
i. Ground Floor 200m
ii. First Floor 200m
Semi-detached factories 500m
Single-storey workshops 250m

Cost/m
Double- storey terraced factories RM735
Semi-detached factories RM850
Single-storey workshops RM670





Type of building Selling price (RM)
30 units of double- storey terraced factories RM300,000.00
15 units of semi-detached factories RM450,000.00
15 units of single-storey workshops RM250,000.00
Double-Storey
Semi-
Detached
Single
Storey
Terrace Factories Workshop
Site cost RM186/m RM186/m RM186/m
GFA 800 m 350 m 250 m
Cost/m RM935 RM860 RM670
Infrastructure (% of building cost) 25% 10% 5%
Preliminary 5% 5% 5%
Predevelopment and related cost


(% of total construction cost) 15% 15% 15%
Contingencies 8% 8% 8%
Construction period 1 year 1 year 1 year
Selling price after completion RM300,000 RM450,000 RM250,000
Interest of finance 10% 10% 10%



1. Building cost


Double- storey terraced factories 400 x 750 RM300,000


Semi-detached factories 500 x 860 RM430,000
Single-storey workshops 250 x 670

RM167,500



2. Infrastructure cost (% from building cost) RM75,000 RM43,000 RM8,375
Total Building and infrastructure cost RM375,000 RM473,000 RM175,875



3. Preliminaries (6% of total building cost) RM18,000 RM25,800 RM10,050
Total construction cost RM393,000 RM498,800 RM185,925



4. Finance on construction


393,000 x 1 x 10% RM19,650


2


498,800 x 1 x 10% RM24,940
2


185,925 x 1 x 10%

RM9,295.25
2





5. Site cost


Cost/m


Area (m)


Cost = Area x Cost/m RM148,800 RM65,100 RM46,500



6. Finance on site


RM148,800 x 10% x 1 yr RM14,880


RM 65,100 x 10% x 1 yr RM6,510
RM 46,500 x 10% x 1 yr

RM4,650
Total land cost RM163,680 RM71,610 RM51,150



Double-Storey
Terrace
Semi-
Detached
Factories
Single Storey
Workshop

7. Predevelopment cost (15% of total construction cost) RM58,950 RM74,820 RM27,888.75



8. Contingencies


(8% of total construction, infrastructure, pre.) RM31,440 RM39,904 RM14,874



COST OF DEVELOPMENT RM666,720 RM710,074 RM289,133
Selling Price RM300,000 RM450,000 RM250,000



Developer's profit/loss RM366,720 RM260,074 RM39,133



Percentage return


Types of Building Total No. of
Building
Developer Profit for 1
Building
Total Developer
Profit/Loss
Double-storey terrace 30 RM366,720 RM11,001,600
Semi-detached factories 15 RM260,074 RM3,901,110
Single storey workshop 15 RM39,133 RM586,995


Based on the feasibility report above, the developer are advisable to sell the land since the
construction is not feasible enough to proceed. The developer will not gain any profit from
the construction instead of loss. Hence, it is more profitable to sell the land.