2.
SCHOOL
OF
ARCHITECTURE,
BUILDING
AND
DESIGN
BACHELOR
OF
QUANTITY
SURVEYING
(HONS)
BUILDING
ECONOMICS
(QSB
60804)
/
DEVELOPMENT
ECONOMICS
(QSB
60303)
SEMESTER
MARCH
2017
BUILDING
AND
DEVELOPMENT
ECONOMICS
WORKSHOP
NAME:
STUDENT
ID:
LOW
CHEE
YING
0319126
MELVIN
LIM
WEI
JIEN
0315772
MUHAMMAD
AIMAN
BIN
ZAINUL
ABIDIN
0321832
MUHAMMAD
HAZIQ
BIN
HAJI
ABD
ZARIFUL
0314131
NG
DING
BOON
0319243
LEONG
CHEE
MUN
0316256
LIEW
CHIA
NIU
0313338
LIEW
YONG
SHENG
0315108
LIM
CHERN
YIE
0315688
LIM
JIE
QI
0318313
LECTURER:
SR.
DIANNE
KOK
HUI
WEI

3.
CONTENTS
1.0 Introduction……………...……………………….………………………………... 1
1.1 Company Introduction…………………………………………………………. 2
1.2 Project Introduction…………………….……………………………………… 2
1.3 Green Features…………………….…………………………………………… 6
2.0 Construction Cost…………………………………………….….…........……….... 8
2.1 Cost Appraisal…………………………………………………………………..9
2.2 Assumptions List……………………….……………………………………… 10
2.3 Sources of Data……………………….………………………..…….…………11
2.4 Cost Breakdown……………………….………………………..…….……..… 19
3.0 Marketing Plan……………………………………………………………………...21
3.1 Marketing Plan & Strategies..…………………………………………………..22
3.2 Completion Period……………………...……………………………………… 26
3.3 Leasing Price…………………………...……………………………………… 27
3.4 Payback Period……………………........……………………………………… 29
4.0 Conclusion……....……………………….………………………………................ 30
5.0 References……………………………………. ………......………………………..32

5.
2
1.1 Company Introduction
We are YUSUKA Sdn. Bhd., a specialized construction consultant company. Lately,
our client Urban Redevelopment Authority would like to consult for our professional advice
about the construction cost, total development cost, payback and preliminary design
according to the conditions and requirements provided on a piece of land at Central
Boulevard in Singapore. The key personnel positions for this project are stated as below:
Development Manager : Haziq Zariful
Construction Manager : Leong Chee Mun
Quantity Surveying Manager : Melvin Lim
Leasing Manager : Ng Ding Boon
Markets Specialist : Lim Chern Yie
Architect : Liew Yong Sheng
Mechanical and Electrical Engineer : Lim Jie Qi
Civil and Structural Engineer : Aiman Zainul Abidin
Facility Manager : Low Chee Ying
1.2 Project Introduction
Client Requirements:
1. This building must be achieved the standard of Grade A building.
2. This building have to comply with the requirement of Green Building Index or Green
RE in order to reducing the consumption of energy, water and improving public
health and safety by enhancing the planning, design and construction of buildings to
create a comfortable living.

6.
3
The land parcel is located at the heart of Singapore’s city centre at Singapore’s
Downtown District around the area of Marina Bay. The new development area around the
bay is generally developed into two separate directions. One direction is from the existing
CBD (Central Business District) and comprises the development at One Raffles Quay, The
Sail at Marina Bay, The Marina Bay Financial Centre, Asia Square Towers and Marina One.
The other is from Marina Centre and consist of development at Marina Bay Sands, of which
has extended the critical mass of exhibition and convention, hotel and entertainment facility
into the area of Bayfront.
Marina Bay is a beautiful, vibrant and high traffic internationally with a great mix of
commercial, residential and entertainment functionality. The area has been established
essentially as a major business and financial precinct to complement the existing CBD and
serves as a home to many major local and international companies and financial institutions.
Two promontory sites were set aside for development of major public attraction and
distinctive landmark buildings. The site was developed as the ArtScience Museum as part of
the Marina Bay Sands development. The Central Promontory Site, on the other hand, is
currently retained as an interim open space also known as Promontory @ Marina Bay and is a
popular location for events and activities.
The Land Parcel is strategically placed with a conspicuous frontage along Central
Boulevard and Raffles Quay-Shenton Way, two main roads within Marina Bay and the CBD.
The development will offer excellent views for tenants to the Marina Bay waterfront to the
north-east, green open space to the south-east, and across the CBD to the west. The Land
parcels provide opportunities that help develop a distinctive landmark of mixed-use
development that is brilliantly designed and also features high-quality architecture and
landscape that will emphasize the importance of the land parcel in the city

7.
4
The site was divided into five plot: Plot 1 with 10,868.7m2, Plot 2 with 289.4m2 of
subterranean space, Plot 3 with 264.4m2 of subterranean space, Plot 4 with 184.8m2 of air
rights space and finally Plot 5 with 516.5 m2 of air rights space.
Plot 1 was mainly built specifically for Office use while at the same time allowing
commercial, hotel, residential, recreation or entertainment use, which ever would bring out
the best profit out of the plot provided. Plot 2 and 3, on the other side of the coin, are
genreally for underground pedestrian links, in the link connect to the development of Plot 1.
Plot 2 is located beneath marina view and is mainly for the provision of a
underground pedestrian links that connects to the existing knock-out panels at the Downtown
Mass Rapid Transit (MRT) Station. Plot 3, located beneath Commerce Street, was connected
from the existing entrance/exit point at Asia Square Towers. Plot 4 and 5 are similar to Plot 2
and 3 but elevated. The connection of Plot 4 derives from Asia Square Tower as well and
Plot 5 is a connection to the One Raffles Quay, both are located across commerce street and
central boulevard respectively.

8.
5
The ground floors were two storey heights for aesthetic purpose as well as allowing
the pedestrian links to pass through. After the public space, the entrance of the building
serves as a lobby, office workers may enter the top floors to the two side of the building
(colored in blue in the ground floor plan) while the others may enter and enjoy retail stores
behind the lobby. The childcare was placed at the corner of the overall ground floor plan. The
ramp will allow employees to park their car in the car park above the high end retail podium
(colored green in the isometric diagram). Car park was built above rather than below was due
to the consideration of the Common Service Tunnel (CST), a comprehensive system of
underground tunnel which houses and distributes utility service lines, including electricity,
potable water, chilled water, NEWater and telecommunication cables, the construction of car
park may risk and cost more to precaution that the structure tunnel may be compromised. The
building consists of a high and medium tower, both of which are for office used. The high
tower, total of 25 floors with 3 at 3.5 m height and the remaining with 3.0m high, holds a
total gross floor area of 3780.23m2
. The medium tower, contrariwise, holds 12 floors above
the car park and consists of 3260m2
gross floor area.

9.
6
1.3 Green Features
One of the more interesting aspects in the development of this building is the
application of Green Building. Green building is the practice of development of structure and
using technology that are environmentally friendly, responsible and resource-efficient
throughout a building’s life-cycle from siting to design, construction, operation, maintenance,
renovation and deconstruction (EPA, 2016) The development of the building uses 55 Market
Street (Image above) as benchmark for the project as we found out the building have good
energy efficiency through the use of high frequency ballasts, PLCs and LEDs, the use of
Motion sensors for staircase, recycling facilities made available in the building as well. The
location also, coincidentally, has good access to Raffles Place MRT station. The building
then motivated the architect to implement several applications into our building.
1. LED Motion Sensor Switch: The sensor switch will automatically shuts off after
continued inactivity within the room, increases energy efficiency
2. Standby Escalator: The escalator does not operate until user approaches, provide
benefits similar to first point.
3. Double-deck Elevator: Elevator uses AC power and uses no permanent magnet thus
no aging effect and prolong life.
4. ACMV Hybrid Ventilation System: Installation cost lowered and minimizes energy
consumption (37% heat load). The power usage is also lowered.

10.
7
5. Green Wall design: The design could be placed above the car park where there’s
some permissible space. The plant shall grow onto the cable tie. Implication provides
visual and thermal (through evaporative transpiration) comfort as well as control air
temperature and humidity. More importantly, it provides a beautiful aesthetic to cover
the dull car park.
6. Rainwater Harvesting System: The building would have rainwater drainage system
that will lead, collect and filtered underground from the roof. The water can only be
used for flushing toilet and replanting the green wall.
7. Solar panels: Placed at the roof of the tower. Energy collected is clean and also
renewable. Singapore is one of the hotter climate countries and can increase
efficiency of the application.

11.
8

12.
9
2.1 Cost Appraisal

13.
10
Summary of Construction Cost
Description Percentage (%) Cost (RM)
Preliminaries 10.0% 77,140,024.63
Structural Works 24.3% 187,795,212.00
Architecture 27.7% 213,770,086.37
M&E 24.3% 187,795,212.00
External Works 1.7% 12,777,200.80
Green Mark Requirements 8.5% 55,389,165.47
Contingencies 4.8% 36,733,345.06
Total 100.0% 771,400,246.33
Table 1: Cost Breakdown
2.2 Assumptions List
1. The project consists of two towers. Tower A is a 25-storey office building; Tower B
is a 12-storey mid-rise office building with 2 storey of multi-storey carpark below it,
and 1 level of high end retail podium including a child care centre.
2. Pilled foundation is used for this project.
3. Prefabricated structure frame will be used as the structure of building.
4. The transfer structure of building is transfer beams.
5. Basement carpark is not included to not disrupt the CST.
6. Marble tiling will be used at the high end retail podium as the floor finishes.
7. At grade Pedestrian Link is assumed to be glass roofing with flamed finish heavy duty
granite tiling.
8. Above-Grade Pedestrian Link is assumed to be steel structure with poly glass skylight,
column with size of 500mm x 500mm x 4.5m high with concrete grade 40.
9. Bicycle parking space for one bicycle is 1.7m length x 0.6m width, 80 bicycle parking
space will be designed.

14.
11
10. Childcare centre will accommodate approximately 100 children capacity, complete
with the facilities like: children playground, playing room, classrooms, canteen,
library, children swimming pool, washrooms/changing room and napping room.
11. 8.5% of the construction cost is allocated to satisfy the Green Mark requirements.
12. Standby Escalator is used for the high end retail podium.
13. Hybrid Ventilation System is the ACMV system used for this building.
14. CCTV systems, alarm system and computerised card access control system will be
installed for security measure purposes.
15. LED motion sensor lights will be used at the corridors to increase energy efficiency.
16. There will be a sky garden at the roof of the low rise building.
17. Rainwater harvesting system used for flushing toilet and replanting the green wall.
18. Solar panels is installed to generate the energy needed to operate the building to
decrease carbon footprint.
19. Curtain wall will be used as the façade of the building.

15.
12
2.3 Source of Data
*Sources not featured in the section are based on multiple Elemental Cost Analysis of similar projects
a) Price of carpark (RM/m2
)
b) Cost/m2 of office & commercial buildings
For an an accurate price, the average rate of ‘TOTAL’ was taken for the cost appraisal
c) Turfing Price (RM/m2
)
Source: JUBM & Langdon Seah Cost Handbook 2016,
p. 19, Basement Car park rate in Kuala Lumpur
Source: JUBM & Langdon Seah Cost Handbook 2016, p. 20,
Office / Commercial Building Rates in Kuala Lumpur
Source: Jabatan Pengairan dan Saliran,
Malaysia, Buku Purata Kadar Harga
2014, p. 32, Cost of turfing under
landscaping item

16.
13
d) Cost/m2
of relevant Trees
e) Cost/m2 of relevant shrubs
Source: Jadual Kadar Harga
Pokok Jabatan Landskap
Negara, p. 34, Cost of Dyera
costulata
Source:
Jadual
Kadar Harga
Pokok Jabatan
Landskap Negara,
p. 40, Cost of
Gnetum gnemom
Source: Jabatan Pengairan dan Saliran, Malaysia, Buku Purata Kadar Harga 2014,
p. 34, Cost of shrubs & distance of spacing. Average cost/m2 taken.

17.
14
f) Sources of Raw Construction Material
Used at the breakdown of cost data
Source: quantitysurveyoronline.com.my/materials-prices, Prices of Building
Materials within Klang Valley, Malaysia, 2017

18.
15
g) Sources of Steel Frame for Pedestrian Link
Conversion to RM as well as % mark-up is done for the cost appraisal
h) Cost/m2
of Granite Tiles for paving
Source: Flora
Development Sdn Bhd
Tower 3 (81303), Price
per m2
of Granite Tiling
including breakdown

19.
16
i) Stainless Steel handrail
Used at the breakdown of Pedestrian Link & includes specifications
Source:
alibaba.com,
2017,
price
per
m
of
handrail
Supplier:
Foshian
Jianou
Decorative
Hardware
Ltd

20.
17
j) Poly glass skylight
Used at the breakdown of Pedestrian Link & includes specifications
Source:
alibaba.com,
2017,
price
per
m2
of
poly
glass
skylight
including
specifications
Supplier:
Shanghai
Quanfu
Sheets
Co.,
Ltd.

21.
18
k) 5m Steel Column
Used at the breakdown of Pedestrian Link & includes specifications
Conversion to RM as well as a 5 mark-up is done for the cost appraisal
Source:
C
&
R
Outdoor
Lighting,
2017,
price
per
5m
of
steel
column
including
specifications
Supplier:
C
&
R
Outdoor
Lighting

22.
19
2.4 Cost Breakdown
This section stipulates the cost breakdown of specified items in the cost appraisal that
consists of the combination of different rates of different materials.
a) Green Replacement
Item No. / m2 Cost/m2 (RM)
Trees (Azadirachta excelsa)
- RM 80.00 / No
- allowed 1.0 m c/c
5 400
Shrubs (Cordyline)
- RM 7.00 / No
- allowed 0.3 m c/c
18 126
Turfing
- allowed 10% mark up
1 3.74
Hardscape (Project sign, Planter box) 500
TOTAL 1029.74
b) Public Space
ITEM Price Per unit Asummption
Trees (1.5 x 1.5 x 1.5) RM5 m2
Turfing RM17 m2
25mm cement and sand (1:3) paving RM15 m2 (Grade 35, 150mm deep)
Exacavation <2m deep RM8 m2
Cost/m3 of concrete slab RM45 m2
Guocera Porcelain Tiles 600 x 600 RM30 m2
TOTAL RM119 m2

23.
20
c) Underground Pedestrian Link
d) Vertical Circulation Point
Lift RM Unit RM / m2
Excavation & disposal 25 m3 175
Concrete 150mmthk 350 m3 53
Steel Bar 4.2 kg/m2 4.2
plaster and paint 25 m2 25
257.20
Stair
Excavation & disposal 25 m3 175
Concrete 150mmthk 350 m3 53
Steel Bar 4.2 kg/m2 4.2
plaster and paint 25 m2 25
Railing 600 m2 600
Floor screeding 35 m2 35
Tiles 50 m2 50
942.20
RM Unit RM / m2
Excavation & disposal 25 m3 150
assume height is
4m
4m height times 4 sides =
16m2
Concrete m2 x thickness = volume 350 m3 52.5
Steel Bar 4.2 kg/m2 4.2
Formwork 2 side 45 m2 45
plaster and paint 25 m2 25
floor screeding 35 m2 35
Tiles 50 m2 50
Ceiling 45 m2 45
406.7
contigences 20% 81.34 81.34
TOTAL 488.04

24.
21

25.
22
3.1 Marketing Plan and Strategies
We are constructing for 2 blocks of building. The higher block will sell off to bank
sector for them to operate as their headquarter. The reason we sell off to a bank sector
because they are more flexible and have more capital to buy from us. They can shift their
former headquarter to here in this central of town to generate their business more effectively.
From the ground floor up to few floors can be customer services or walk in services
department then the upper floors can be used for any other operating departments
The lower block is planned by renting or leasing for offices and have a podium for
food and beverage or any other conventional retail stores. In order to rent or lease in our
preferred target, there are several strategies which downtown advocates in Central Bouvelard
can implement in order to encourage the desired leasing direction for new and existing
downtown buildings.
In this development, there are two blocks of building and a podium retail. Both blocks
are planned to rent or lease out as offices while the podium retail is rented out for food and
beverage or any other conventional retail stores.
For both blocks, it is mainly aimed to find potential clients from different types of
field such as financial securities, financial institutions, insurance corporations, property
corporations, multinational corporations and international corporations. This is because due
to the high rental cost for Grade A offices, clients’ from these sectors have more capital and
are more flexible to rent these office spaces. At the same time, the location provides ease of
accessibility for the employers, employees or clients to reach the place as some corporations
will experience high traffic flow of customers.
In order to rent or lease in our preferred target, there are several strategies which
downtown advocates in Central Bouvelard can implement in order to encourage the desired
leasing direction for new and existing downtown buildings are as follows:
Set up a website
This is the most important point. When we are a new community we naturally have to
create a bit of buzz. People walk past and see the construction happening so that the local

26.
23
businesses are aware of us. Depending on the situation, we may even get mentioned in local
media such as if we are a new luxury community in a certain part of town or are opening near
a major university or growing neighborhood, for example.
Cameron (2006) explained that “people who hear about us from one of those sources
and want to know more will generally get online and do a Google search to see if they can
learn more about us”. Then, when they open, rent rate, amenities and our information about
the building will be showed on the site. If our only web presence is on the corporate site or on
an ILS that will make our community harder to find and provide a poorer experience for
people as the information they want will probably be harder to find than it would be on a
community page. Additionally, on an ILS they will also be finding your competitors
alongside your own listing.
We want to make sure that when they search for us, they find us. And if they find us
on a community-specific website that answers all the questions they have about our new
community such as price, amenities, availability then all the better.
Other than that, we need a community website with the closest thing we can get to
photos and video tours of each floor plan. That visual content will help prospects to see what
our community actually looks like. We can create computer-generated videos that look like
what the floor plans will look like when completed. We have been working with this
technology for nearly years. So if possible, we should get computer-generated graphics up as
placeholders until we can get real photos and videos of the completed floor plans to attract
possible leasing targets.
Develop an Effective Leasing Brochure for Downtown
Although the historic buildings and character will not appeal to many of the retailers
that will consider more suburban-type locations, the downtown area will need a comparable
leasing brochure to be considered by serious companies. Joyce, William & Kevin (2007)
argued that “the package or brochure should summarize the market information contained
within this report, including data on Central Boulevard’s trade area, demographics and
income information on the resident population, information on visitor and tourist volume,
highway traffic statistics, and property sheets on the particular site that are available”. The

27.
24
property sheets should include a photo of the site or building along with information about its
size, age, rent or sales price, income, available incentives such as eligibility for tax credits,
etc (Joyce et al, 2007).
The site listing should also include data about access, parking, signage controls,
permitting, etc. The leasing package need not be expensive like color copies or computer
printed sheets are fine but should be professionally designed and packaged (Morris, Richard
& Daniel, 2005). These brochures can either be mailed to prospective retailers or their
representatives, or used as ‘leave-behind’ packages by the tenant recruitment teams described
below and because of the flexibility of the Internet, the data created for the leasing brochure
can also be made available on our website.
Seasonal events brochures, distributed in the same locations, but promoting
performance events and festivals. These brochures require a carefully planned
annual/seasonal schedule of dates and should be published enough in advance to allow
visitors and residents to plan ahead, book hotel rooms.
Incentives
In order to keep all the long-term retailers to keep leasing with us, we have to provide
incentives for them. We can provide some incentives like if the retailer leases with our
company more than 5 years, from the sixth years onwards, we will them absorb all the fees
such as stamp duty fees, parking fees and maintenance fees.
When a local merchant learns that we will promote their business to our community
they will embrace the idea of cross promotion. Local employers are especially happy when
their employees live in close proximity to work. Proximity to work contributes to less
tardiness and fewer missed days due to bad weather.
Ong (2016) suggested that other ways to support our local merchant in exchange for
free advertising are to include coupons or flyers of the local business in new resident
welcome packages, put a “Welcome to the community! Enjoy dinner (or a discount etc.) on
us!” note in all new resident packages, offer local merchant discounts or gift cards. In
exchange the local merchant can post our building ad on notice boards or shopping carts and

28.
25
also include our ad in their company flyers and mailings. This can develop mutually
beneficial relationships with local merchants can be rewarding on both a personal and
financial level (Ong, 2016).
Reaching International Tenants
As for our business go to the top level; we have to attract tenants from international to
make our name worldwide. We can create virtual video tours that allow applicants to
manipulate the screen and zoom in on finish, kitchen appliances, bathrooms and views to
help them get a better feel of the retail stores. Traditional tours of the amenities, lobbies and
highlights of the surrounding areas are also helpful to assist them in vision. Other than that,
work to build trust and a strong reputation with any current tenants who come from abroad.
The remote leasing process largely revolves around referrals, so word of mouth is your best
marketing tool (Rew, 2014).
First step we can reach them is that we have to engage some specialized agents.
Landlords should engage the services of a leasing professional who has experience in
reaching out to tenants that will have a high interest for their property. These agents handle
multiple leasing accounts within a specific project, hence may be able to match a suitable
tenant with the properties they advertise more accurately. In these times, potential landlords
should not try to select their tenants based on their nationality. There are those who are in the
position that landlords should have the right to choose (Gurin, 2007).
For the international tenancy, we have to request an employment letter that states the
applicant’s annual salary meets the income requirement and can cover the first month’s rent
and a one-month security deposit. Then, we could ask for prepayment of six-months rent and
a security deposit if the applicant does not meet the income requirement, unless they have an
in-state guarantor because we cannot follow up on finance issues across country lines. For the
payment part, it has to be made via wire transfer, credit card or a country-based bank certified
check and ensure the applicant mails copies of their passport along with a secondary photo ID
and their application. Applicants should begin researching and preparing necessary
documents at least 45 days in advance. The process for remote leasing takes a minimum of
five days once the application has been submitted (Rew, 2014).

29.
26
It is important for them to remain competitive. Being competitive does not render one
to lose out, as the owner with a strategic view recognizes that market conditions will
eventually improve. At the end of the day, owners who devise active strategies to cope with
the current climate will find that such challenges do count as invaluable experiences for their
long-term cyclical property investments.
3.2 Completion Period
This construction project is supposed to be completed in 7 years but we have
proposed that this project will be a prefabricated construction project, thus the construction
period of this building project can be shortened to 4.5 years. Reasons why choosing
prefabricated construction can reduce the construction period:
a) Weather factor: Construction works will not be affected by the weather conditions as
prefabricated buildings are constructed off-site in modules and are then brought to the
construction site in flat-packed panels for ready to build (Green Modular, 2016).
b) Accelerate construction process: Prefabricated building projects can be completed 30%
to 50% faster than any on-site construction project (Green Modular, 2016) as some
construction works can be conducted simultaneously in prefabricated building projects
for instance, off-site construction works can be conducted along with the foundation
works (Construction World, 2014).
c) Reduce site disruption: This construction method removes 80% of the construction
activities away from the actual site location (Green Modular, 2016). Thus, there will be
lesser traffic issues since most of the building components are completed in the factories.
This will result in shorter construction time (Construction World, 2014).

30.
27
No. Building Sections Completion Period
1 Foundation 1 year & 6 months
2 Office Lobby 2 months
3 High Tower Office (22 floors) - 3 weeks per floor 1 year & 3 months
4 High End Retail Podium 5.5 months
5 Carpark (4 floors) - 3 weeks per floor 3 months
6 Medium Tower Office (16 floors) - 3 weeks per floor 11 months
Total 4.5 years
3.3 Leasing Price
Lilien, Gary & Philip (2003) discussed that “leasing price is the amount of money
paid over a specified time period for the rental of an asset, such as real property or an
automobile”. The lease rate that the lender earns from allowing someone else to use his
property compensates him for not being able to put that property to another use during the
term of the lease (Lilien et al, 2003). Normally the lease rate is commonly stated as a dollar
amount per square foot of space per year. Our leasing price is using Singapore Dollar rate and
then convert to Malaysia Ringgit.
Assumptions
Assume finance cost @ 11%, Formula = (total borrowing/2)* [(1+i)^n-1]
Assume professional cost @ 8% GDC
Assume advertisement and marketing @ 3%of GDC
Assume non lettable space for all areas are 15%
Assume the construction period reduces to 4.5 years
Office Retail Children
GFA (m2) 133,630.00 5,000.00 607.00
Non-lettable space (m2) 20,044.50 750.00 91.05
Lettable space (m2) 113,585.50 4,250.00 515.95
Lettable space (ft2) 1,222,634.32 45,747.00 5,553.69
Rates (SGD $/ ft2 per month) 9.25 15.00 15.00
Rates (RM / ft2 per month) 28.62 46.42 46.42
Income 34,997,516.22 2,123,502.54 257,793.21
Total Income per month 37,378,811.98
Total Income per year 448,545,743.74
Table 2: Estimated Completion Period For Each Building Section

31.
28
Gross Construction Cost
Construction Cost 771,400,246.33
Finance@5% (Conc. Cost/2 * (1.05^4.5-
1) 94,698,355.46
Professional Fees@ 8% 61,712,019.71
Advertisement and Marketing @3% 23,142,007.39
GDC (RM) 950,952,628.89
Payback Period 2.12 years
Return on Investment 47%
Figure 1: Office Leasing Price
Source: Commercial Guru SG

32.
29
3.4 Payback Period
The payback period is the length of time required to recover the cost of an
investment. The payback period of a given investment or project is an important determinant
of whether to undertake the position or project, as longer payback periods are typically not
desirable for investment positions. Unfortunately, it also ignores the time value of money and
does not discount these free cash flows back to the present. Accept or reject criterion centers
on whether the project’s payback period is less than or equal to the firm’s maximum desired
payback period (Cameron, 2006).
The payback period is using formula by GDC divided by the total income per year
which is RM 950,952,628.89 divided by RM 448,545,743.74. Thus, the period we get is 2.12
years. Although this is considered early for the payback, the results after our discussion seem
possible and we wish to get back our capital and earn profit as soon as possible. This is a
positive sign for our company.

33.
30

34.
31
CONCLUSION
In a conclusion, the project has achieved high income to the client. The benchmark
project, 55 Market Street, is being used because it is located near to MRT station as similar to
our project. Cost of the construction for this project is RM 771,400,246 and development cost
is RM 950,952,628.89. The subtraction of the total development costs from the value of the
completed development gives the trading profit of the project. Return on investment for the
project is 47% which mean return of investment is higher than cost of the investment. Time
required to cover the cost of development is 2.12 years.
The method of construction for the project as prefabricated concrete construction
decreases the construction period from 7 years to 4.5 years. Prefabricated construction is the
fastest method that very suitable to gain fast payback period income. Besides that,
prefabricated construction is high quality and easy to install. It is widely used especially on
the urban project. This project comprises two towers which are 25 floors and 20 floors
respectively.
Application of green building used on the building consists of LED motion sensor
light switch, standby escalator, lift and ACMV system. All these applications improves
overall energy efficiency of the building as well as provide improvements towards
maintenance, enhancing value for money by reducing the need to maintain. Employment of
facilities management teams will research and ensure the condition of the building is long
lasting. This building is secured by CCTV systems which operate 24 hours every day. CCTV
required computerized card access to control the system.

35.
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