This assignment aims to see whether this project is feasible or not by calculating the gross development cost.
Step one: in this step in order to ascertain the yield % in Preston (IN THE UK), you need to locate 3 or 4 buildings in the same category as your proposed building which are for sale and rent, NB these building need NOT be the same size or height as you proposed building, Therefore, there is more freedom with your choice.
After getting the similar building to your property and identify the yield of each one chose most proper building to your proposed building.
Exercise 2: in order to arrive a market rent, you need to compare the building you are proposing with similar buildings in Preston that are rent. I suggest 3 or 4 comparable properties. The step to come up with market rent for the proposed building by checking in Preston market and chose the similar one.
After these two steps you should come with the total internal area for your building detecting the circulation space.
After you get the net internal area you should calculate the Gross Development Value.
After you calculate the gross development value you calculate all costs including in the project, cost to build, professional fees, contingency, etc…..
Than detect all amounts and costs from the GDV and check if this project feasible or not.
Proposed building specification: –
– Type of the building: office building.
– Area of the building: 852.92m
– Number of story: 4
This building is use now as a car parking which should to construct the proposed building in this area and in this land.
The cost which shound fined out and detect from the Gross Development Value are:
– External work
– professional fees 12%
– ancillary cost
– site investigation
– planning fees
– marketing fees
– sale fees as a percentage
– building coast
– building reg fees
– interest rate Px(1+i)
– banks legal fees
– banks arrangement fees
– developer’s legal fees
– demolition coast
– site clearance
– letting agent’s fees
– finance risk
each step should be describe for example the specification of the buildings and similarities of the chased building with the proposed building as well the reasons of chosen the figures. The figures should be taken from reliable sources or books with UK standard. So the report has to be submitted to the board of director of the company.
As well it should content of introduction and conclusion.
Note: you should read a assignment brief before start working in the assignment and consider if any points not considered in my explanation.
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