1. LEC 2 : Building Economic L1 FALL 2011

2.  Why do we need a building ?  Why do we need a building ? “Birds & animals”, “Beast master”, “Lost World”, “Survivors” - Common link - We are not them  Designing and making buildings : Stakeholders - “Sky is the limit”, constraints to the choice of building systems - Codes, regulations, ordinances, unions, etc. Economical  How to choose a building system ? “Experience”, “Pleasing to the eyes”, “Economical”, etc. during and after construction  Performance during and after construction FALL 2011 LEC 2 : Building Economic L2

3. FALL 2011 LEC 2 : Building Economic L2 build because  We build because little that we do can take place outdoors. We need shelter from sun, wind, rain, and snow. We need dry, level platforms for our activities. Often we need to stack these platforms to multiply available ground space. On these platforms, and within our shelter, we need air that is warmer or cooler, more or less humid, than outdoors. We need less light by day, and more light by night, than is offered by the natural world. We need services that provide energy, communications and water and disposal of wastes. So we gather materials and assemble them into the constructions we call buildings to satisfy these needs.

4. FALL 2011 LEC 2 : Building Economic L2 What are the minimum requirements? Legal Security Legal Security of Tenure: this protects people from eviction, harassment, and other threats. The States must provide and enforce security of tenure in consultation with affected groups Availability of Services, Materials, Facilities, and Infrastructure Availability of Services, Materials, Facilities, and Infrastructure: Housing includes facilities essential for health, security, comfort, and nutrition. For example, there must be safe drinking water, energy for cooking, heating, lighting, sanitation facilities, refuse disposal, storage and emergency services Affordability Affordability: The cost of adequate housing should not compromise the satisfaction of other basic needs

5. FALL 2011 LEC 2 : Building Economic L2

6. FALL 2011 LEC 2 : Building Economic L2  Cost  Cost = anything that reduces your business objective  Benefit  Benefit = anything that contributes to it investment operational  Two types of costs: investment (capital costs) and operational (on- going)

7. FALL 2011 LEC 2 : Building Economic L2  Preliminary  Preliminary (meetings, legal, land)  Construction  Construction (excavation, structures, buildings)  Equipment  Equipment (vehicles, lab, etc.)

8. FALL 2011 LEC 2 : Building Economic L2  Cost is a resource sacrificed or foregone to achieve a specific objective, or something given up in exchange.  Profits are revenues minus expenses  Life cycle costing is estimating the cost of a project plus the maintenance costs of the products it produces  Cash flow analysis is determining the estimated annual costs and benefits for a project  Benefits and costs can be tangible or intangible, direct or indirect

9. FALL 2011 LEC 2 : Building Economic L2  Cost estimating: Developing an approximation or estimate of the costs of the resources needed to complete a project.  Cost budgeting: Allocating the overall cost estimate to individual work items to establish a baseline for measuring performance.  Cost control: Controlling changes to the project budget.