COST PLANNING AND ESTIMATION

Course outline Overview of Cost Planning Cost Planning Techniques Approximate Estimating Elemental Method Cost Planning at Various Stages of Design Resource Analysis Cash Flow Valuation Final Accounts

Teaching Scheme DATE CHAPTER 1. Overview of Cost Planning 2. Cost Planning Techniques 3. Approximate Estimating 4. Elemental Method 5. Cost Planning at Various Stages of Design 6. Resource Analysis 7. Cash Flow 8. Valuation 9. Final Accounts Exam

4. Elemental Method 4.1 Elemental Cost Analysis 4.2 Elemental Method 4.3 Building Economics and Cost Analysis

4.1 Elemental Cost Analysis Source: Elemental Standard Form of Cost Analysis Principles, Instructions, Elements and Definitions, 4th (NRM) Edition, 2012, Building Cost Information Service of RICS

4.2 Elemental Method The forecast cost of each element can be calculated in two ways:- By general adjustments for each element on a similar building By measuring the approximate quantity of each element and applying a unit rate.

4.2 Elemental Method Sources of cost data In-house data Cost database Cost analyses Project rates   Published data Government Institutions Journals and magazines Pricing books Market testing

4.2 Elemental Method Affects on cost Quantum Economies of scale Availability   Location Regional variations Exchange rates Timing Inflation Market conditions Quality

4.2 Elemental Method Project A = Total cost for a bungalow at Holland Village is S$ 4 million, built in 2010 with total gross floor area of 2,000m2 How much for a project B – a bungalow at Jurong Island, to be built in 2015 with total gross floor area of 3,000m2?

4.2 Elemental Method Project A = Total cost for a bungalow at Holland Village is S$ 4 million, built in 2010 with total gross floor area of 2,000m2 How much for a project B – a bungalow at Jurong Island, to be built in 2015 with total gross floor area of 3,000m2? From BCA: Adjust for time for construction: Cost x 2015 TPI divided by 2010 TPI

4.2 Elemental Method Project A = Total cost for a bungalow at Holland Village is S$ 4 million, built in 2010 with total gross floor area of 2,000m2 How much for a project B – a bungalow at Jurong Island, to be built in 2015 with total gross floor area of 3,000m2? Assuming it is 15% more expensive to construct at Jurong Island Adjust for location for construction: Cost + 15%

4.2 Elemental Method Project A = Total cost for a bungalow at Holland Village is S$ 4 million, built in 2010 with total gross floor area of 2,000m2 How much for a project B – a bungalow at Jurong Island, to be built in 2015 with total gross floor area of 3,000m2? Answer S$ 4 million / 2,000m2 x 3,000m2 x time x location = 4,000,000 / 2,000 x 3,000 x 104/100 x 1.15 = S$ 7,176,000

4.2 Elemental Method Elemental cost = Quantity x Unit Rate

4.2 Elemental Method

4.3 Building Economics and Cost Analysis Design economics Assessment criteria Site density Wall/floor ratio Floor area ratios e.g. net to gross Area efficiency e.g. M2 per bed Functional unit rate e.g. $ per pupil Building height e.g. height to eaves or storey height