1. COST PLANNING AND ESTIMATION

2. 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

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

5. 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

6. 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.

7. 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

8. 4.2 Elemental Method Affects on cost Quantum Economies of scale
Availability
Location
Regional variations
Exchange rates
Timing
Inflation
Market conditions
Quality

9. 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?

10. 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 with total gross floor area of 3,000m2?
From BCA:
Adjust for time for construction: Cost x 2015 TPI divided by 2010 TPI

11. 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%

12. 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

13. 4.2 Elemental Method
Elemental cost = Quantity x Unit Rate

14. 4.2 Elemental Method

15. 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