feasibility study to build a 4-storey residential building in amman - jordan
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INVESTMENT OPPORTUNITIES IN JORDAN
Building a 4-Storey Residential Building in the West of Amman
Feasibility Study – Version One
Tariq Al-Basha – Feasibility Studies Specialist
6/24/2014
The purpose and scope of this feasibility study is to introduce the subject matter and provide a general idea and information on the said area. All the material included in this document is based on data/information gathered from various sources and is based on certain assumptions. Although, due care and diligence has been taken to compile this document, the contained information may vary due to any change in any of the concerned factors, and the actual results may differ substantially from the presented information.
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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Contents Introduction .................................................................................................................................................. 4
Project Description........................................................................................................................................ 4
The Spaces of the Building ............................................................................................................................ 5
Expected Land Area to be Bought................................................................................................................. 5
Construction Cost .......................................................................................................................................... 5
Project Revenues .......................................................................................................................................... 6
Total Selling Prices per Floor ......................................................................................................................... 6
Cash Flow (In & Out) ..................................................................................................................................... 7
Important Notes............................................................................................................................................ 8
About the Author .......................................................................................................................................... 9
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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﴿قالوا سبحانك ل علم لنا إلا ما علامتنا إناك أنت العليم الحكيم﴾
صدق هللا العظيم
23آية –رة البقرة سو
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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Introduction The residential building will be built on almost a land area of 787.50 m² and it will be
divided into 4 floors.
The total cost of the project will be JOD 1,169,925.08 (USD 1,651,388.79).
The expected revenues from selling all the residential apartments will be between JOD
1,520,000.00 to 1,560,000.00 (USD 2,145,378.63 to 2,201,835.96).
The expected net profit before tax will be between JOD 350,074.92 to 390,074.92 (USD
494,107.40 to 550,564.74).
Project Description
The project consists of one residential building that has 8 residential apartments (“flats”);
spread equally over 4 floors.
The apartments’ size of the first, second and third floors are 150 m² per each apartment
that includes 3 bedrooms, 3 bathrooms, kitchen, living room, guest room, balcony,
laundry room and corridors.
The apartments’ size of the ground floor is 170 m² per each apartment that includes 3
bedrooms, 3 bathrooms, kitchen, living room, guest room, balcony, laundry room,
corridors, garden and car parking.
The facilities provided in the building are:
Car parking that caters 8 cars (96 m²);
Guard Room – (24 m²);
Service Rooms including a room for water tanks, room for boilers, room for diesel
tanks and storage (160 m²); and
A 6-person-elevator.
The owners of third floor apartment have the right to buy 20 m² of the building roof.
The roof of the building accommodates additional water tanks, solar water heating
system (SWH) and satellites.
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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The Spaces of the Building Entry No. of Flats Total Floor Area (Sqm) Space for Sale (Sqm)
Underground Floor - 350.00 280.00
Ground Floor 2.00 350.00 340.00
First Floor 2.00 350.00 300.00
Second Floor 2.00 350.00 300.00
Third Floor 2.00 350.00 300.00
Roof - - 40.00
Total 8.00 1,750.00 1,560.00
Expected Land Area to be Bought
Formula: Land Area in Sqm (X) x [The average of the maximum percentage of the building
(42%) from the land area of housing sector (B) and the maximum percentage of the building
(48%) from the land area of housing sector (C)] = Total built-up Area (Sqm)
X x [100 / ((42 + 48) / 2))] = 1,750
X x 100/45 = 1,750
X = 1,750 x 45/100
X = 78,750 /100
X = 787.50 sqm
Construction Cost Entry Measurement Unit No. of Units The Cost per Unit (JOD) Total Cost (JOD)
Cost of Purchasing the Land Square Meter 787.50 742.86 585,000.00
Designs and plans Square Meter 1,750.00 10 17,500.00
Infrastructure Works Square Meter 1,750.00 60 105,000.00
Structure Works Square Meter 1,750.00 70 122,500.00
Electromechanical Works Square Meter 1,750.00 55 96,250.00
Finishing Works Square Meter 1,750.00 100 175,000.00
Site Supervision & Management Construction Cost 498,750.00 6.17% 30,772.88
General & Administrative Expenses
Construction Cost 498,750.00 3% 14,962.50
Licenses, Permits and Others Total Cost 1,146,985.38 1% 11,469.85
Reserves Total Cost 1,146,985.38 1% 11,469.85
Total 1,169,925.08
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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Project Revenues Entry No. of
Flats Space for
Sale (Sqm) No. of Flats
to buy Space for Sale per Flat (Sqm)
Selling Price per sqm (JOD)
Total Selling Price per Flat (JOD)
Total Selling Price (JOD)
Underground Floor - 280.00 8.00 35.00 1,000.00 35,000.00 280,000.00
Ground Floor 2.00 340.00 2.00 170.00 1,000.00 170,000.00 340,000.00
First Floor 2.00 300.00 2.00 150.00 1,000.00 150,000.00 300,000.00
Second Floor 2.00 300.00 2.00 150.00 1,000.00 150,000.00 300,000.00
Third Floor 2.00 300.00 2.00 150.00 1,000.00 150,000.00 300,000.00
Roof - 40.00 2.00 20.00 1,000.00 20,000.00 40,000.00
Total 8.00 1,560,000.00
Total Selling Prices per Floor
Entry No. of Flats
Space for Sale per each Flat (Sqm)
Space for Sale per each Flat (Sqm)
Selling Price per sqm (JOD)
Best Case Scenario per
each Flat
Worst Case Scenario per
each Flat
Best Case Scenario per each Floor
Worst Case Scenario per each Floor
Notes Per
Floor
Includes the underground floor and/or roof (Best Case Scenario)
Includes the Underground Floor
and does not include the roof (Worst Case
Scenario)
JOD JOD JOD JOD
Ground Floor 2.00 205.00 205.00 1,000.00 205,000.00 205,000.00 410,000.00 410,000.00
First Floor 2.00 185.00 185.00 1,000.00 185,000.00 185,000.00 370,000.00 370,000.00
Second Floor 2.00 185.00 185.00 1,000.00 185,000.00 185,000.00 370,000.00 370,000.00
Third Floor 2.00 205.00 185.00 1,000.00 205,000.00 185,000.00 410,000.00 370,000.00
Total
1,560,000.00 1,520,000.00
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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Cash Flow (In & Out) Entry Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Cash In
Capital 1,169,925.08
Total Cash In (Monthly) 1,169,925.08 - - - - - - - - - - -
Total Cash In (Cumulative) 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08 1,169,925.08
Cash Out
Cost of Purchasing the Land 585,000.00
Designs and plans
17,500.00
Infrastructure Works
26,250.00 26,250.00 26,250.00 26,250.00
Structure Works
30,625.00 30,625.00 30,625.00 30,625.00
Electromechanical Works
24,062.50 24,062.50 24,062.50 24,062.50
Finishing Works
35,000.00 35,000.00 35,000.00 35,000.00 35,000.00
Site Supervision & Management
2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53 2,797.53
General & Administrative Expenses 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88 1,246.88
Licenses, Permits and Others 11,469.85
Reserves 955.82 955.82 955.82 955.82 955.82 955.82 955.82 955.82 955.82 955.82 955.82 955.82
Total Cash Out (Monthly) 598,672.55 48,750.23 31,250.23 61,875.23 61,875.23 59,687.73 59,687.73 64,062.73 64,062.73 40,000.23 40,000.23 40,000.23
Total Cash Out (Cumulative) 598,672.55 647,422.78 678,673.01 740,548.24 802,423.47 862,111.20 921,798.93 985,861.66 1,049,924.39 1,089,924.62 1,129,924.85 1,169,925.08
Total Net Cash (Monthly) 571,252.53 (48,750.23) (31,250.23) (61,875.23) (61,875.23) (59,687.73) (59,687.73) (64,062.73) (64,062.73) (40,000.23) (40,000.23) (40,000.23)
Total Net Cash (Cumulative) 571,252.53 522,502.30 491,252.07 429,376.84 367,501.61 307,813.88 248,126.15 184,063.42 120,000.69 80,000.46 40,000.23 0.00
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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Important Notes
This study is subject to the Building and Planning Regulations for the city of Amman No.
67, 1979.
The land price includes all the applicable fees, charges and taxes.
The price of designs and plans includes all the possible amendments and changes on
the designs and plans.
The prices of infrastructure, structure, electromechanical and finishing works include
workers’ salaries and wages and the cost of all the required materials, goods, equipment
and transport to build the building.
By and large, the areas and prices are approximate.
Tariq Al-Basha - 00962 7 9767 7418 - tariqalbasha@outlook.com
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About the Author
Awarded First Class Honours in Bachelor of
Arts (Honours) Business Management from
the University of Greenwich – UK.
Working as a Project Finance Officer for an
Iraqi-owned Group in which representing the
CEO and shareholders' interest in 23
companies, subsidiaries and affiliates in Iraq,
Jordan, Lebanon and UAE.
Previous works related to feasibility studies:
1. Feasibility & Financial Studies for Mall
& Hotel in Basra – Iraq; the total land
area is 5,810 m² and the total built-up
area is 25,988 m².
2. Feasibility & Financial Studies for
Medical Diagnostic Center in Basra –
Iraq; the total land area is 7,770 m²
and the total built-up area is 18,350
m².
3. Financial Studies for Mixed-use
Development in Basra – Iraq; the total land area is 152,367 m² and the total built-
up area is 77,949 m².
4. Financial Studies for Mixed-use Development in Basra – Iraq; the total land area
is 135,000 m² and the total built-up area is 90,000 m².
5. Financial Studies for Mall & Hotel in Karbala – Iraq; the total land area is 6,511
m² and the total built-up area is 21,400 m².
6. Financial Studies for Medical Diagnostic Center in Baghdad – Iraq; the total land
area is 2,450 m² and the total built-up area is 8,245 m².
7. Financial Studies for Mixed-use Development in Baghdad – Iraq; the total land
area is 115,690 m² and the total built-up area is 337,665 m².
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