Ls Construction Cost Handbook 2012.pdf
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View Ls Construction Cost Handbook 2012.pdf as PDF for free.
More details
- Words: 80,836
- Pages: 312
Legal: © Langdon & Seah All rights reserved. No part of the publication may be reproduced or copied in any form without prior written permission from Langdon & Seah. The information contained in the handbook should be regarded as indicative and for general guidance only. Whilst every effort has been made to ensure accuracy, no responsibility can be accepted for errors and omissions, however caused. Unless otherwise stated, costs reflected in the handbook are costs as at 4th Quarter 2011.
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise
HONG KONG + SHANGHAI +
BEIJING +
GUANGZHOU/ + + SHENZHEN + CHONGQING CHENGDU
3,838 2,863 2,217 2,453
1,096 822 658 987
776 528 560 993
622 439 525 605
760 480 440 800
780 500 470 1,000
2,251 2,733 2,545
987 1,316 1,206
947 1,269 1,090
760 1,044 983
860 1,100 900
940 1,250 950
N/A 2,713 3,436
1,370 1,096 2,193
N/A 1,116 1,919
N/A N/A 1,517
N/A 1,050 1,880
N/A 1,100 2,150
1,184
N/A
N/A
N/A
N/A
N/A
1,334
N/A
N/A
N/A
N/A
N/A
N/A 1,805
548 735
586 765
520 648
550 N/A
550 N/A
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E.
1,900 1,028 1,497 1,663 2,852
830 398 598 343 1,051
780 456 632 335 970
759 353 415 266 798
700 390 480 330 900
700 390 500 330 990
Exchange Rate Used : US$1 =
HK$7.8
RMB6.35
RMB6.35
RMB6.35
RMB6.35
RMB6.35
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F. & E. 5-star luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review.
+
Rates are exclusive of contingencies.
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE
MACAU Ђ
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA Ω
3,455 3,015 1,545 2,230
2,400 2,040 1,680 2,760
962 317 463 1,070
751 525 871 1,071
409 300 347 439
1,210 620 845 1,070
2,200 2,520 2,710
2,080 2,320 2,240
752 1,105 917
871 1,192 1,097
406 514 470
820 1,080 960
N/A 2,560 3,480
2,480 2,560 3,440
1,333 1,537 2,241
1,438 1,559 2,163
723 817 1,588
1,290 1,230 1,600
1,245
1,120
438
483
263
430
N/A
1,360
521
N/A
313
475
N/A N/A
960 N/A
435 530
441 N/A
252 317
410 440
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E.
1,230 910 N/A N/A N/A
1,310 760 1,055 1,160 1,770
505 286 327 413 854
N/A 494 693 793 N/A
254 222 178 228 605
480 465 590 695 1,260
Exchange Rate Used : US$1 =
MOP7.97
S$1.25
RM3.15
B$1.26
INR50
PHP43
DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F. & E. 5-star luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review. Ђ
Φ
Rates are exclusive of contingencies and any management contract fee. Rates are nett of GST and exclusive of contingencies.
� Ω
Rates based on projects in Bangalore and are nett of VAT and Service Tax. Mumbai costs are generally 8% higher. Rates are exclusive of contingencies and include 12% VAT.
PROGRESS PAYMENTS The following graph and table are an indication of the rate of expenditure for construction projects. The rate of expenditure is an average rate and will vary from project to project when specific project circumstances are taken into account. No account has been made for retention.
CONTRACT PERIOD
CUMULATIVE PROGRESS CLAIMES
CONTRACT PERIOD
CUMULATIVE PROGRESS CLAIMES
5%
1%
55%
59%
10%
3%
60%
68%
15%
5%
65%
77%
20%
7%
70%
83%
25%
10%
75%
88%
30%
14%
80%
92%
35%
21%
85%
94%
40%
29%
90%
96%
45% 50%
38%
95%
98%
48%
100%
100%
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE
SEOUL $
TOKYO ♣
500 - 600 425 - 485 635 - 760 815 - 945
1,930 1,605 1,310 1,630
2,760 N/A 2,230 3,100
760 - 880 890 - 1,130 695 - 815
1,170 1,330 1,480
2,680 3,200 2,190
1,195 - 1,500 1,495 - 1,750 1,825 - 2,060
1,535 1,730 2,300
3,510 3,480 5,100
238 - 390
N/A
1,540
N/A
395 - 510
N/A
2,040
600 N/A
260 N/A
385 - 510 395 - 495
690 N/A
1,760 N/A
275 - 325 200 - 250 550 - 675 410 - 540 810 - 900
683 350 N/A N/A N/A
390 260 N/A N/A N/A
640 - 730 340 - 455 475 - 500 500 - 630 755 - 840
965 565 1,820 1,080 1,460
N/A 1,690 2,070 1,890 2,280
PKR89.42
BAHT30
IDR8,910
VND21,011
KRW1,144
JPY78.14
KARACHI
BANGKOK #
985 - 1,150 250 - 350 580 - 775 870 - 1,150
967 583 828 1,162
475 N/A 595 800
575 - 725 950 - 1,150 695 - 900
750 983 800
575 860 495
2,267 1,367 1,933
1,200 980 1,395
300 - 375
600
N/A
350 - 450
N/A
435 - 450 325 - 425
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E. Exchange Rate Used : US$1 =
DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 1,965 - 2,305 3-star budget hotels, inclusive of F.F. & E. 1,125 - 1,450 5-star luxury hotels, inclusive of F.F. & E. 1,800 - 2,100 INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
JAKARTA ^ HO CHI MINH #
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review. #
^
Rates are nett of VAT and contingencies. Rates are nett of VAT.
$
♣
Rates are nett of VAT and exclusive of contingencies. Rates exclude contingencies, consultant fees and consumption tax.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
GUANGZHOU/ CHONGQING SHENZHEN
HONG KONG
SHANGHAI
BEIJING
HK$/m2
RMB/m2
RMB/m2
RMB/m2
RMB/m2
RMB/m2
1,600 - 2,350 380 - 500 1,750 - 2,150 1,950 - 2,400 650 - 1,300
761 - 966 173 - 289 971 - 1,265 1,050 - 1,103 310 - 410
750 160 910 790 130 -
990 270 1,110 950 370
650 135 890 660 105 -
880 240 1,115 890 325
700 - 900 150 - 250 750 - 1,000 600 - 850 100 - 300
700 - 1,000 150 - 250 750 - 1,200 600 - 1,000 100 - 300
CHENGDU
1,300 - 1,950 450 - 850 1,500 - 2,150 1,400 - 1,950 850 - 1,300
593 305 651 520 252 -
651 431 830 651 368
460 320 705 481 253 -
670 450 898 663 386
450 260 565 450 240 -
650 400 765 610 380
450 300 550 450 250 -
650 400 700 600 350
450 300 550 450 250 -
700 400 800 700 350
270 - 380 220 - 330 800 - 1,050 270 - 380 550 - 850
110 89 368 137 168 -
163 131 488 184 226
95 95 360 140 165 -
140 140 470 200 225
105 75 325 105 125 -
140 102 410 140 220
70 70 300 70 120 -
130 120 400 130 200
70 70 300 70 120 -
130 120 400 130 200
430 250 430 430 75 -
550 300 550 550 120
226 168 289 268 47 -
320 278 399 383 116
180 140 215 215 60 -
265 215 370 370 125
190 125 230 230 55 -
295 240 345 345 105
180 150 200 220 50 -
250 250 330 330 100
180 150 200 220 50 -
250 250 330 330 100
550 450 450 650 330 -
900 600 650 850 650
275 130 215 320 160 -
540 380 485 485 320
294 145 232 327 175 -
577 400 520 520 289
250 135 200 305 105 -
410 390 390 430 230
350 150 300 300 140 -
550 350 450 400 250
350 150 300 300 140 -
600 350 500 450 250
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated.
* Generally without A/C. ** Excludes special power supply.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
MACAU
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA Ω
MOP/m2
S$/m2
RM/m2
B$/m2
INR/m2
PHP/m2
N/A N/A 1,850 - 2,150 1,600 - 2,150 550 - 650
153 29 150 158 95
-
228 136 289 214 192
350 60 280 280 200
-
455 90 450 410 283
133 17 214 152 157
-
166 29 247 181 181
3,600 - 4,700 1,600 - 2,800 4,500 - 4,850 3,500 - 4,500 2,000 - 2,500
3,000 - 4,300 650 - 1,300 3,000 - 6,000 2,500 - 3,700 1,900 - 3,000
N/A N/A 1,900 - 2,300 1,900 - 2,100 650 - 850
203 58 202 170 109
-
306 148 340 275 252
220 140 240 200 85
-
465 157 590 260 210
171 143 214 162 185
-
214 171 280 233 233
2,800 - 4,000 1,800 - 3,100 3,200 - 4,900 3,000 - 4,000 1,200 - 1,600
3,300 - 6,000 2,000 - 3,500 4,400 - 8,400 3,600 - 5,400 3,200 - 4,800
N/A N/A 850 - 1,050 300 - 400 550 - 750
31 19 97 49 75
-
71 39 136 75 159
23 36 173 23 18
-
52 45 235 30 45
12 8 45 9 28
-
29 14 62 30 44
575 - 850 375 - 650 3,000 - 4,500 825 - 1,500 1,300 - 1,800
900 - 2,000 700 - 1,200 1,750 - 3,800 650 - 1,100 1,300 - 2,600
N/A N/A 500 - 600 400 - 500 100 - 150
32 24 49 38 19
-
64 54 78 63 53
57 45 65 60 20
-
80 60 90 80 25
24 9 19 24 19
-
29 14 36 48 38
900 - 1,200 400 - 550 1,000 - 1,300 850 - 950 450 - 550
600 - 1,200 600 - 900 600 - 1,100 600 - 900 600 - 1,300
N/A N/A 500 - 700 400 - 600 400 - 500
62 46 76 83 27
-
177 114 138 200 123
88 54 85 85 63
-
400 190 370 110 105
7 3 9 9 8
-
24 14 33 27 19
650 - 900 400 - 550 800 - 1,000 800 - 1,100 500 - 700
1,600 - 2,900 N/A 1,500 - 3,000 700 - 1,700 800 - 1,500
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated.
* Generally without A/C. ** Excludes special power supply. Φ
Rates are nett of GST.
� Ω
Rates are based on projects in Bangalore and are nett of VAT and Service Tax. Mumbai costs are generally 8% higher. Transformer, included in Electrical Services.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
KARACHI
BANGKOK �
JAKARTA #
HO CHI MINH
SEOUL $
TOKYO ♣
PKR/m2
BHT/m2
IDR'000/m2
VND'000/m2
KRW'000/m2
JPY/m2
3,750 - 8,500 1,085 - 1,890 7,600 - 9,950 7,600 - 9,950 2,600 - 3,500
3,900 - 4,800 1,250 - 1,400 4,500 - 5,100 4,400 - 4,800 4,400 - 4,500
625 195 625 570 570
- 735 - 455 - 840 - 680 - 730
1,590 - 2,267 N/A N/A N/A 1,198 - 1,729
200 87 205 144 92
- 280 - 150 - 330 - 240 - 169
21,000 11,200 14,800 7,100 3,000
4,425 - 5,413 2,431 - 3,392 5,850 - 9,925 4,715 - 7,825 2,000 - 3,270
2,250 - 2,500 1,650 - 1,700 2,750 - 3,200 2,150 - 2,400 2,390 - 2,950
510 280 510 450 510
- 680 - 450 - 730 - 570 - 680
1,962 - 2,337 N/A N/A N/A 1,740 - 2,197
250 115 350 200 130
- 365 - 150 - 460 - 230 - 165
19,600 10,400 18,800 7,600 12,200
765 - 1,205 630 - 835 3,200 - 4,845 465 - 1,240 1,360 - 1,970
750 - 890 700 - 780 1,350 - 1,490 780 - 950 1,150 - 1,350
120 71 510 120 510
- 190 - 130 - 740 - 190 - 730
263 - 502 N/A N/A N/A 514 - 1,171
32 20 57 27 49
-
55 30 89 56 65
12,600 5,700 16,600 5,400 18,300
160 70 150 160 160
- 250 - 130 - 250 - 210 - 210
614 - 1,019 N/A N/A N/A 420 - 528
40 27 56 42 32
-
65 30 87 69 65
563 - 1,079 N/A N/A 1,161 - 1,642 633 - 920
45 16 110 55 27
1,285 - 1,675 1,125 - 2,025 1,285 - 2,650 1,125 - 2,025 850 - 1,350 1,745 - 3,100 1,745 - 3,100 3,500 - 8,100 1,745 - 3,100 1,745 - 3,100
760 720 750 760 760 -
850 750 850 790 850
1,000 - 1,050 N/A 1,000 - 1,100 210 - 490 450 - 500
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated. * Generally without A/C. ** Excludes special power supply. � Based upon nett enclosed area and nett of VAT. $ Rates are nett of VAT.
#
♣
270 - 740 N/A 270 - 680 205 - 540 260 - 540
- 60 - 25 - 155 - 78 - 38
Included in above
5,600 2,500 5,100 3,600 2,700
All rates are nett of VAT. Rates for Electrical Services are excluding genset. Rates for Hydraulic Services are excluding STP. Rates for Mechanical Services refer to ACMV Rates only. All costs are average. Sprinkler system, fire hose reel are included in Hydraulic Services. Smoke spill exhaust system is included in Mechanical Services. Fire alarm system, emergency PA system are included in Electrical Services.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with dine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
UNIT
HONG KONG SHANGHAI
BEIJING
GUANGZHOU/ CHONGQING SHENZHEN
CHENGDU
HK$
RMB
RMB
RMB
RMB
RMB
m3 m3 m3 m3 m3 m3 kg kg
115 110 190 * 650 900 1,130 9.8 9.8
30 25 105 168 400 470 6 6
15 18 25 120 500 560 6.3 6.3
25 30 68 155 380 465 6.2 6.2
16 18 43 120 380 420 6.3 6.3
20 25 35 130 380 420 6.3 6.3
m2 m2 m2
180 180 190
65 55 90
45 45 58
55 55 47
55 55 50
m2
600
N/A
N/A
N/A
N/A
N/A
m2
1,700
600
780 **
550
750 **
750 **
kg
25
12
11
14
12
12
kg m2
27 80
10 35
11 20
11 21
10 22
10 25
m2
95
28
22
18
17
20
m2 m2
270 430
160 170
120 140
115 157
120 130
120 130
m2
44
32
30
26
30
30
3-8
5 - 10
5 - 10
5 - 10
5 - 10
%
10 - 15
55 55 60 @
The above costs are at 4th Quarter 2011 levels and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated.
*
@
Rate including waste charges implemented on 1 Dec. 2005. Rates for 120mm thick concrete block walls.
**
Rates for double glazed window.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with fine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbong” 0.64mm profiled steel sheeting
MACAU
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA
MOP
S$
RM
B$
INR
PHP
m3 m3 m3 m3 m3 m3 kg kg
110 105 60 580 680 730 9.5 9.5
16.5 16.5 15 50 202 Φ Φ 155 - 170 1.6 - 1.75 1.6 - 1.75
15 - 20 15 - 20 20 - 25 60 - 70 230 - 250 250 - 280 3.5 - 3.8 3.5 - 3.8
3.5 3 3 37 117 132 0.98 0.98
130 145 100 3,060 4,200 5,125 40 42
350 250 200 2,500 3,500 4,800 47 48
m2 m2 m2
160 160 250
30 - 33 30 - 33 30 - 35
30 - 38 30 - 38 32 - 45
14.5 14 18.5
425 450 700
850 800 N/A
m2
N/A
43
55 - 60
56
960
900
m2
2,000
290
350 - 500
166 - 216
kg
35
4.8- 5.8
6 - 7.5
3
75
100
kg m2
32 80
4.8 - 5.8 11
6 - 7.5 15 - 22
2.7 7.5
75 300
95 350
m2
95
15.5
15 - 22
8
230
350
UNIT
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces
m2 m2
400 460
65.5 30
50 - 70 30 - 45
23 28
1,100 850
1,200 1,300
m2
80
3.5 - 4
3.5 - 4
5
130
350
Average expected preliminaries
%
8 - 15
12 - 15
6 - 12
5-8
5 - 10
8 - 15
3,700
9,000 Ω
The above costs are at 4th Quarter 2011 levels and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated. Φ Rates are nett of GST. Φ Φ Rate for lean concrete blinding.
� Ω
Rates are based on projects in Bangalore and are nett of VAT and Service tax. Mumbai costs are generally 8% higher. Rate for aluminium with anodized finish; 6mm thick.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
UNIT
KARACHI PKR
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with fine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbong” 0.64mm profiled steel sheeting
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
BANGKOK # JAKARTA #
HO CHI MINH #
SEOUL $
TOKYO
BHT
IDR'000
VND'000
KRW
JPY
100 100 100 600 2,000 2,400 31 30
23 30 25 270 710 850 10 10
69 64 66 306 1,352 1,730 23.3 22.2
2,100 2,100 12,000 26,500 57,000 72,000 1,070 1,080
890 940 3,140 8,100 11,200 13,200 68 83
350 350 700
120 120 120
181 223 165
23,000 23,000 40,000
3,400 3,400 13,100
m2 3,765 - 4,845
1,200
175
516
35,000
2,200
m2 5,000 - 7,500
6,000
880
2,545
249,900
23,000
385 - 635 m3 320 - 495 m3 180 - 280 m3 3 m 1,170 - 1,413 m3 5,000 - 5,500 m3 7,500 - 8,500 kg 80 - 110 kg 77 - 115 m2 m2 m2
485 - 625 550 - 790 990 - 1,060
kg
135 - 160
55
18
33.5
2,400
210
kg m2
135 - 160 425 - 590
55 200
18 44
38.5 46
1,900 2,500
320 2,600
m2
375 - 580
200
50
66.35
8,300
3,000
110 100 æ
245 300
55,000 24,000
6,100 N/A
18
62.3
7,100
900
5 - 10
8 - 12
6 - 11
10 - 15
m2 1,300 - 1,500 m2 850 - 1,250 m2
270 - 375
%
8 - 10
1,200 800 100 10 - 15
The above costs are at 4th Quarter 2011 and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated. #
Rates are nett of VAT.
æ Rate for 9mm gypsum board.
$ &
Rates include labour costs and are nett of VAT. Including undercoat and primer.
CONSTRUCTION COSTS FOR SELECTED INTERNATIONAL CITIES US$/m2 BUILDING TYPE
LOS SAN ANGELES FRANCISCO
NEW YORK
LONDON
3,600
3,700
2,420 - 3,060
4,200
4,300
4,500
3,220 - 4,420
1,650
3,400
3,500
3,800
3,600 - 5,430
1,605
1,250
3,700
3,900
4,000
2,800 - 3,520
3,585
1,850
1,600
4,200
4,400
4,500
4,000 - 5,120
2,530
1,110
1,180
2,800
3,100
3,200
1,830 - 2,390
3 star budget
3,265
2,220
1,900
2,100
2,200
2,250
1,940 - 2,340
5 star luxury
4,530
2,880
2,500
4,500
4,600
4,700
3,570 - 4,370
Resort style
4,110
2,220
3,000
4,500
4,600
N/A
Light duty factory
685
450
430
1,200
1,400
1,200
850 - 1,070
Heavy duty factory
865
575
600
1,600
1,800
1,900
1,410 - 1,760
895
535
460
850
880
900
District hospital
4,055
3,130
1,250
7,300
7,500
6,300
2,950 - 3,680
Primary and secondary schools
1,720
1,760
850
3,00
3,200
3,600
2,230 - 3,300
Exchange Rate Used (as at July 2011) US$1 =
A$0.93
NZ$1.25
ZAR7.00
US$1.00
US$1.00
US$1.00
GBP0.63
SYDNEY
AUCKLAND
JO'BURG
Average multi unit, high rise
2,845
1,770
940
3,500
Luxury unit, high rise
3,265
2,670
1,640
Individual prestige houses
3,440
2,815
Average standard offices, high rise
3,160
Prestige offices, high rise Major shopping centre (CBD)
RESIDENTIAL
COMMERCIAL/RETAIL
HOTEL
N/A
INDUSTRIAL
OTHERS
Multi storey carpark
510 - 860
The above costs are at 2nd Quarter 2011 levels. Prices excludes land, site works, professional fees, tenant fitout, equipment and GST/VAT. Hotel rate includes FF&E. Large fluctuation in exchange rates can create short tem anomalies.
CONSTRUCTION FLOOR AREA (CFA) DEFINITION The construction floor area measured from drawings is defined as covered floor areas fulfilling the functional requirements of the building measured to the outside face of the external walls or external perimeter. It includes floor ares occupied by: ○ partitions ○ columns ○ stairwells ○ lift shafts ○ plant rooms ○ water tanks ○ balconies ○ utilities platforms ○ vertical ducts ○ service floors higher than 2.2m and the like But excludes floor areas occupied by: ○ bay windows ○ planters projecting from the building, and ○ the areas covered by canopies, roof eaves and awnings Sloping surfaces such as staircases, escalators and carpark ramps are to be measured flat on plan.
The measurement of construction floor area is as defined by Langdon & Seah.
FINANCIAL DEFINITIONS & FORMULAE Discount Rate The rate of return a developer expects when investing in a project. i.e. opportunity cost Internal Rate of Return (IRR) The IRR may be defined as the interest rate that equates the present value of expected future cash flows to the cost of the investment. The IRR can be compared to the Discount Rate. Net Present Value (NPV) The NPV is the present value of all future cash flows, discounted back to today’s values at the Discount Rate. The NPV indicates in today’s dollars the profit or loss a developer makes above or below his required profit (based on a nominated Discount Rate). 72 Rule The approximate number of years required to double your capital can be calculated by dividing the interest rate into 72. e.g.
If interest rate = 10% p.a. Then 72 ÷ 10 = 7.2 years It will take approximately 7.2 years to double your capital if it is invested at 10% p.a.
Future value of $1
FV = PV (1+i)n
Future value of $1 per period
FV = PMT [((1+i)n – 1) ÷ i]
Sinking fund (the amount required to be put away periodi- PMT = FV [i ÷ ((1+i)n – 1)] cally to realise some future sum) Present value of $1
PV = FV [1÷ (1+i)n]
Present value of $1 per period
PV = PMT [((1+i)n – 1) ÷ (i(1+i)n)]
Annuity with a PV of $1
PMT = PV[(i(1+i)n) ÷ ((1+i)n - 1)]
PV FV PMT n i
= = = =
present value future value payment amount period (e.g. 10 years with monthly payments, n = 10 x 12 = 120) = interest rate per period (e.g. 12% p.a. compounded monthly; i = 12% ÷ 12 months = 1% per period)
MORTGAGE REPAYMENT TABLE Based on: * 1,000 units of currency * Interest compounded monthly * Equal monthly repayments REPAYMENT (years)
Interest p.a.
5
10
15
20
5%
18.87
10.61
7.91
6.60
6%
19.33
11.10
8.44
7.16
7%
19.80
11.61
8.99
7.75
8%
20.28
12.13
9.56
8.36
9%
20.76
12.67
10.14
9.00
10%
21.25
13.22
10.75
9.65
11%
21.74
13.78
11.37
10.32
12%
22.24
14.35
12.00
11.01
13%
22.75
14.93
12.65
11.72
14%
23.27
15.53
13.32
12.44
15%
23.79
16.13
14.00
13.17
16%
24.32
16.75
14.69
13.91
17%
24.85
17.38
15.39
14.67
18%
25.39
18.02
16.10
15.43
19%
25.94
18.67
16.83
16.21
20%
26.49
19.33
17.56
16.99
21%
27.05
19.99
1 8.31
17.78
22%
27.62
20.67
19.06
18.57
23%
28.19
21.35
19.82
19.37
24%
28.77
22.05
20.58
20.17
25%
29.35
22.75
21.36
20.98
Example Borrow $1,000,000 to be repaid monthly at 10% p.a. over 10 years. Repayments = 1,000,000 / 1,000 x $13.22 = $13,220 per month
PRIME RATES & BASE LENDING RATES as at 4th Quarter 2011
Country
Rate (%)
Australia*
4.50
Brunei China**
5.50
Egypt***
10.25
Hong Kong India
6.90 5.00 14.75
Indonesia Japan^
6.00
Macau
5.25
Malaysia
6.60
New Zealand^^ Pakistan^^^
1.60
10.01 13.97
Philippines
5.74
Singapore
5.38
South Africa
9.00
South Korea+ Thailand++
3.25 7.71
United Kingdom
0.50
United States of America Vietnam+++
3.25 9.00
* Over Night Cash Rate ** 3-Year Benchmark Lending Rate *** Overnight Lending Rate ^ Long Term Prime Rate % pa (Implementation 10-Dec-2010) ^^ SME Overdraft Rate (Previously Businesss Base Lending Rate) ^^^ Weighted Average Lending Rate + Base Rate of The Bank of Korea ++ Minimum Loan Rate % pa (Average Based on Local Bank) +++ Minimum and in VND per year Source: DLS branches Central Bank of Egypt (www.cbe.org.eg) Reserve Bank of New Zealand (www.rbnz.govt.nz) Bank of England (www.bankofengland.co.uk) www.economagic.com www.investec.com www.money-rates.com
UTILITY COSTS FOR SELECTED ASIAN CITIES EXCHANGE RATE
WATER
ELECTRICITY
FUEL
DOMESTIC
COMMERCIAL/ INDUSTRIAL
DOMESTIC
COMMERCIAL/ INDUSTRIAL
DIESEL
LEADED
UNLEADED
US$1=
US$/kWh
US$/kWh
US$/m 3
US$/m 3
US$/litre
US$/litre
US$/litre
Hong Kong
HK$7.80
0.10
0.11
0.83
0.59
1.52
N/A
2.05
Shanghai
RMB6.35
0.097(peak) / 0.048(normal)
0.16(peak) / 0.077(normal)
0.46
0.60
1.17
N/A
1.19 - 1.26
Beijing
RMB6.35
0.07
0.13
0.63
0.98
1.08
N/A
1.13
Guangzhou
RMB6.35
0.09
0.17 / 0.14
0.20
0.43 / 0.29
0.84
N/A
1.04
Shenzhen
RMB6.35
0.1066
0.525
1.177
N/A
1.089 - 1.271
Macau
MOP7.97
0.11
0.66
1.48
N/A
1.99
Kuala Lumpur
RM3.15
0.069 - 0.144
0.57
N/A
0.60
Singapore
S$1.25
0.22
0.22
1.44
1.67
1.27
N/A
1.75
Jakarta
IDR8,910
0.089
0.102
0.250
0.475
0.475
N/A
0.505
Bangkok
BHT30.00
0.044 - 0.096
0.951
N/A
1.074
Manila
PHP43.00
0.20 - 0.27
1.095
N/A
1.243
Brunei
B$1.26
0.008 - 0.12
0.057 - 0.159 0.087 - 0.349 0.484 - 0.524
0.302
0.404
0.421
Ho Chi Minh
VND21,000
0.082 - 0.141 / 0.051 - 0.092
0.995
N/A
0.99 - 1.014
Bangalore
INR50.00
0.078 - 0.196
0.112 - 0.352 3.083 - 5.507 4.142 - 6.829
0.921
N/A
1.457
New Delhi
INR50.00
0.098 - 0.167
0.123 - 0.229 3.304 - 5.288 4.865 - 7.932
0.82
N/A
1.328
Karachi
PKR89.42
0.078 - 0.16
0.16 - 0.23
1.105
N/A
0.983
Seoul
KRW1,146
0.155
0.0879
0.311
1.475
1.61
N/A
1.73
Tokyo
JPY78.14
0.277
0.277
2.726
5.170
1.459
N/A
1.639
CITY
0.091
0.048 - 0.183 0.361 - 0.721 0.12
0.54
0.110 - 0.137 0.181 - 0.635 0.657 - 0.724
0.054 - 0.056 0.274 - 0.466 0.306- 0.510 0.21
0.56 - 0.65
0.21 - 0.50
1.32
0.65 / 0.35
0.175 - 0.319 0.292 - 0.529
The above costs are at 4th Quarter 2011 levels
Basis of Charges in Hong Kong, China ○ Water Domestic : 12 - 43m3 = US$ 0.53/m3; 0 - 12m3 = Free of charge; Above 62m3 = US$ 1.16/m3 43 - 62m3 = US$ 0.83/m3;
○
Electricity (Based on tariff scheme of CLP Holding Limited) Domestic (bi-monthly consumption) 0 - 400kWh = US$ 0.10/kWh; 400 - 1,000kWh = US$ 0.11/kWh; 1,000 - 1,800kWh = US$ 0.12/kWh; Above 1,800kWh = US$ 0.13/kWh
Basis of Charges in Shenzhen, China ○ Water Domestic : Within 22m3 = US$ 0.361/m3; 23 - 30m3= US$ 0.541/m3; 31m3 and above = US$ 0.721/m3 Commercial : US$ 0.525/m3 Industrial : US$ 0.525/m3 ○ Electricity Commercial : US$ 0.158/kWh Industrial : Peak = US$ 0.183/kWh; Normal = US$ 0.138/kWh; Off-peak = US$ 0.048/kWh ○ Unleaded Fuel 90# = US$1.089/litre; 93# = US$1.174/litre; 97# = US$1.271/litre Basis of Charges in Macau, China ○ Water Domestic :
○
3
Other charges (Depending on meter size 15mm - 200mm) : Meter rental = US$0.33 - 58.07/month; Minimum consumption fee = US$2.22 - 383/month Commercial/ Industrial : Charges for ordinary users (e.g. Business, government buildings, schools, associations, hospitals and others) only. Special users (e.g. gaming industries, hotels, saunas, golf cources, construction, public infrastructures and other temporary consumption) are excluded. Electricity E l e c t r i c i t y t a r i ff a r e c o m p o s i t i o n o f d e m a n d c h a r g e s , c o n s u m p t i o n charges, fuel clause adjustment and government tax.
Basis of Charges in Beijing and Guangzhou, China ○ Unleaded fuel rate is for Unleaded gasoline 97. Basis of Charges in Shanghai, China ○ Unleaded Fuel 93# = US$1.19/litre; 97# = US$1.26/litre Basis of Charges in Kuala Lumpur, Malaysia Unleaded fuel rate is for Unleaded petrol Ron 95.
○
Basis of Charges in Singapore (All rates are nett of GST) Domestic water rate includes conservation tax and water-borne fee and is an average for the 1st 40m3, exclude sanitary appliance fee. ○ Non-domestic water rate includes conservation tax and water-borne fee, exclude sanitary appliance fee. ○ Electricity tariff is based on low tension power supply. ○ Unleaded fuel rate is for 98 Unleaded petrol as at 15 November 2011. ○ Diesel fuel rate as at 15 November 2011.
○
Basis of Charges in Bangkok, Thailand Unleaded fuel rate is for Gasohol 95.
○
Basis of Charges in Manila, Philippines ○ Water Domestic : 32m3 - 52m3/month Commercial/Industrial : 3,204m3/month ○ Electricity Domestic : 100kWh - 533kWh Commercial/Industrial : 222,600kWh Water and Electricity actual billing includes miscellaneous charges such as Environmental Charge, Currency Exchange Rate Adjustment (CERA), VAT, etc. Basis of Charges in Brunei Electricity (Domestic) : Tariff effective from 1st Jan 2012. 1-10 kWh 10c, 11-60 kWh 8c, 61-100kWh 12c, above 100kWh 15c
○
Basis of Charges in Ho Chi Minh, Vietnam (All rates are VAT inclusive) Water Domestic : Used in norm = US$ 0.21; Used over norm = US$ 0.50 Industrial = US$0.35 Commercial = US$0.65 ○ Electricity Domestic electricity rates are applied to the 301 KW above wards ○ Fuel : Diesel fuel D.O - 0.05% : 92 and 95 Unleaded petrol as at October 2011.
○
Basis of Charges in Karachi, Pakistan Fuel : The diesel fuel rate is for High Speed Diesel. : The unleaded fuel rate is for Premier Petrol.
○
Basis of Charges in Seoul, Korea Water Domestic = US$0.939/month (basic rate) + US$0.311/m3 (Within 30m3 usage) Commercial = US$77.39/month (basic rate) + US$1.475/m3 (Within 100m3 usage) ○ Electricity Domestic = US$4.757/month (basic rate) + US$0.155/kWh (500kWh below in use) Commercial = US$5.243/month (basic rate) + US$0.0879/kWh (within 1,000kWh, 3,300V - 66,000V)
○
Basis of Charges in Tokyo, Japan (All rates are VAT inclusive) Water Domestic : Rates for 30mm diameter of water piping + Basic rate of US$41.64. Commercial / Industrial : Rates for 100mm diameter of water piping + Basic rate of US$1,146.28. ○ Electricity 0kWh - 120kWh = US$0.217/kWh; 120kWh - 300kWh = US$0.277/kWh; Over 300kWh = US$0.292/kWh Basic rate = US$3.309 - 10A (ampere); US$9.927 - 30A (ampere); US$19.855 - 60A (ampere) is added.
○
IDD CODES LOCATION
Australia: Melbourne Perth Sydney Bahrain Bangladesh (Dhaka) Bhutan (Thimphu) Brunei: Bandar Seri Begawan Kuala Belait Cambodia (Phnom Penh) Canada: Toronto (Metropolitan) Vancouver China: Beijing Guangzhou Hong Kong Macau Shanghai Shenzhen France (Paris) India: Bangalore Chennai New Delhi Mumbai Indonesia: Bali Jakarta Ireland: Cork Dublin Japan: Tokyo Osaka Kazakhstan (Almaty) Korea (Seoul) Korea (Pyongyang) Laos (Vientiane)
IDD COUNTRY CODE
AREA CODE
61 61 61 973 880 975
3 8 2 2 2
673 673 855
2 3 23
1 1
416 604/250/ 778
86 86 852 853 86 86 33
10 20 21 755 1
91 91 91 91
80 44 11 22
62 62
361 21
353 353
21 1
81 81 7 82 850 856
3 6 727 2 2 21
LOCATION
Malaysia: Johor Bahru Kota Kinabalu Kuala Lumpur Kuching Penang Mongolia (Ulaanbaatar) Myanmar (Rangoon) Nepal (Kathmandu) New Zealand: Auckland Wellington Pakistan (Karachi) Philippines (Manila) Qatar Singapore Spain: Barcelona Girona South Africa: Johannesburg Cape Town Sri Lanka (Colombo) Russia (Moscow) Taiwan (Taipei) Thailand: Bangkok Phuket United Arab Emirates: Abu Dhabi Dubai United Kingdom: London Edinburgh USA: Los Angeles New York Vietnam: Ho Chi Minh City Hanoi
Source : www.worldtimeserver.com ; www.worldtimezone.com www.timeanddate.com
IDD COUNTRY CODE
AREA CODE
60 60 60 60 60 976 95 977
7 88 3 82 4 11 1 1
64 64 92 63 974 65
9 4 21 2 -
34 34
93 972
27 27 94 7 886
11 21 1 495 2
66 66
2 76
971 971
2 4
44 44
20 131
1 1
213 212
84 84
8 4
WEIGHT AND MEASURES Metric Measures and Equivalents LENGTH
1 millimetre (mm) 1 centimetre (cm) 1 metre (m) 1 kilometre (km)
AREA
1 sq cm (cm2) 1 sq metre (m2) 1 hectare (ha) 1 sq km (km2)
= 10 mm = 100 cm = 1,000 m
= 100 mm2 = 10,000 cm2 = 10,000 m2 = 100 ha
VOLUME / CAPACITY
1 cu cm (cm3) 1 cu decimetre (dm3) 1 cu metre (m3) 1 litre (l ) 1 hectolitre (hl )
= 1,000 cm3 = 1,000 dm3 = 1 dm3 = 100 l
MASS (WEIGHT)
1 milligram (mg) 1 gram (g) 1 kilogram (kg) 1 tonne (t)
= 1,000 mg = 1,000 g = 1,000 kg
Imperial Measures and Equivalents LENGTH
1 inch (in) 1 foot (ft) 1 yard (yd) 1 mile 1 int. nautical mile
= 0.0394 in = 0.3937 in = 1.0936 yd = 0.6214 mile
1 sq inch (in2) 1 sq foot (ft2) 1 sq yard (yd2) 1 acre 1 sq mile (mile2)
= 0.1550 in2 = 1.1960 yd2 = 2.4710 acres = 0.3861 mile2
VOLUME / CAPACITY
1 cu inch (in3) 1 cu foot (ft3) 1 fluid ounce (fl oz) 1 pint (pt) 1 gallon (gal)
= 0.0610 in3 = 0.0353 ft3 = 1.3080 yd3 = 1.76 pt = 21.997 gal
MASS (WEIGHT)
1 ounce (oz) 1 pound (lb) 1 stone 1 hundredweight (cwt) 1 ton
= 0.0154 grain = 0.0353 oz = 2.2046 lb = 0.9842 ton
Temperature Conversion
USA Liquid Measure Equivalents
1 fluid ounce 1 pint (16 fl oz) 1 gallon
= 1.0408 UK fl oz = 0.8327 UK pt = 0.8327 UK gal
o
= 0.5506 l
= 29.574 ml = 0.4723 l = 3.7854 l
= 144 in2 = 9 ft2 = 4,840 yd2 = 640 acres
= 6.4516 cm2 = 0.0929 m2 = 0.8361 m2 = 4,046.9 m2 = 2.59 km2
AREA
USA MEASURES AND EQUIVALENTS
USA Dry Measure Equivalents 1 pint = 0.9689 UK pint
= 12 in = 3 ft = 1,760 yd = 2,025.4 yd
= 2.54 cm = 0.3048 m = 0.9144 m = 1.6093 km = 1.853 km
o
C
o
o
C = 5/9 ( F - 32)
F
= 20 fl oz = 8 pt
= 16.387 cm3 = 0.0283 m3 = 28.413 ml = 0.5683 l = 4.5461 l
= 437.5 grains = 16 oz = 14 lb = 112 lb = 20 cwt
= 28.35 g = 0.4536 kg = 6.3503 kg = 50.802 kg = 1.016 t
= 1,728 in3
o
o
F = (9/5 C) + 32
CONVERSION GUIDE Conversion Formulae To use the conversion formulae simply multiply the Imperial measurement by the factor beside the conversion you wish to make. For example 6 inches into milimetres. 6 inches multiplied by 25.4 equals 152.4 milimetres. Conversely if you wish to convert Metric measure into Imperial measure simply divide by the same factor. LENGTH To Convert mili-inches into micrometres inches into milimetres inches into centimetres inches into metres feet into milimetres feet into centimetres feet into metres yards into metres fathoms into metres chains into metres furlongs into metres miles, statute into kilometres miles, nautical into kilometres
Multiply by 25.4 25.4 2.54 0.0254 304.8 30.48 0.3048 0.9144 1.8288 20.1168 201.168 1.609344 1.852
VOLUME & CAPACITY To Convert cubic inches into cubic centimetres cubic inches into litres cubic feet into cubic metres cubic feet into litres UK pints into litres UK quarts into litres cubic yards into cubic metres UK gallons into litres UK gallons into cubic metres UK fluid ounces into cubic centimetres
Multiply by 16.387064 0.016387 0.0283168 28.316847 0.5682613 1.1365225 0.7645549 4.54609 0.0045461 28.413063
AREA To Convert square inches into square milimetres square inches into square centimetres square feet into square centimetres square feet into square metres square yards into square metres square yards into (0.01 hectare) acres into square metres acres into hectares square miles into square kilometres
Multiply by 645.16 6.4516 929.0304 0.092903 0.836127 0.0083613 4046.8564 0.4046856 2.589988
MASS To Convert grains into miligrams grains into metric carats grains into grams pennyweights into grams ounces into grams ounces troy into grams ounces into kilograms pounds into kilograms stones into kilograms hundredweights into kilograms tons into kilograms tons into metric tonnes tahils into grams kati into kilograms
Multiply by 64.79891 0.323995 0.064799 1.555174 28.349523 31.103477 0.0283495 0.4535924 6.35023932 50.802345 1016.0469 1.01605 37.799 0.60479
POWER To Convert foot pounds-force per second into watts horsepower into watts foot pounds-force per second into kilowatts horsepower into kilowatts horsepower into metric horsepower
Multiply by 1.35582 745.7 0.001356 0.7457 1.01387
PUBLIC HOLIDAYS 2011 MALAYSIA
New Year’s Day** 01 Chinese New Year 03 - 04 Prophet Muhammad’s Birthday 15 Labour Day 01 Wesak Day 17 King/Agong’s Birthday 04 Hari Raya Aidilfitri* 30 - 31 National Day 31 Malaysia Day 16 Hari Raya Qurban* 06 Deepavali* 26 Awal Muharram 27 Christmas Day 25
2012
Jan 01 Feb 23 - 24 Feb 05 May 01 May 05 Jun 02 Aug 19 - 20 Aug 31 Sep 16 Nov 26 Oct 13 Nov 15 Dec 25
Jan##
Jan# Feb## May May Jun Aug## Aug Sep## Oct Nov Nov Dec
* Subject to change ** Except Johor, Kelantan, Kedah, Perlis & Terengganu # Except Kelantan & Terengganu ## The following day will be an additional Public Holiday
2011 BRUNEI
New Year’s Day** Chinese New Year Prophet Muhammad’s Birthday** National Day Royal Brunei Armed Forced Ann. Israk Miraj** His Majesty’s Birthday** First Day of Ramadhan* Ann. Revelation of the Holy Koran* Hari Raya Aidilfitri* Hari Raya Aidilfitri* (2nd day) Hari Raya Aidil Adha* & ** First Day of Hijrah* & ** Christmas Day*
Kashmir Day Eid-e-Milad-un-Nabi* (Birth of Prophet) Pakistan Day Labour Day Independence Day Eid al-Fitr (End of Ramadan)* Allama Muhammad Iqbal Day Eid-ul-Azha* (Feast of the Sacrifice) Ashoura* Quaid-e-Azam’s Birthday *Subject to change
05 16
Feb Feb
05 05
23 Mar 23 01 May 01 14 Aug 14 30 Aug- 01 Sep 19 - 21 09 Nov 09
Jan Feb Feb Feb May Jul Jul Aug Aug Aug Aug Nov Nov Dec
02 23 06 23 31 18 16 21 06 20 21 26 15 25
Jan Jan Feb Feb May Jun Jul Jul Aug Aug Aug Oct Nov Dec
Fridays and Saturdays are government off days * Subject to change ** Replacement for Fridays / Sundays CHINA
PAKISTAN
01 03 15 23 31 29 16 01 17 30 31 07 28 25
2012
Feb Feb Mar May Aug Aug Nov
07 - 09 Nov 26 - 27 Oct 06 - 07 Dec 24 - 25 Nov 25 Dec 25 Dec
New Year’s Day@ Chinese New Year’s Eve Chinese New Year* Tomb-Sweeping Day** Labour Day+ Dragon-Boat Festival# Mid Autumn Festival National Day^
01 02 03 - 04 05 01 06 12 01 - 03
Jan 01 Feb 22 Feb 23 - 24 Apr 04 May 01 Jun 23 Sep 30 Oct 01 - 03
@ 2nd and 3rd Jan are holidays, 31 Dec is working day. * 25th to 28th Jan are holidays. ** 2nd and 3rd Apr are holidays, 31st Mar and 1st Apr are working days. + 29th and 30th Apr are holidays, 28th Apr is working day. # 22nd and 24th Jun are holidays. ^ 4th to 7th Oct are holidays.
Jan Jan Jan Apr May Jun Sep Oct
PUBLIC HOLIDAYS 2011 MACAU
New Year’s Day* The first working day after New Year’s Day# Lunar New Year Eve (Afternoon) Lunar New Year Ching Ming Festival Good Friday The day following Good Friday* Easter Monday# Labour Day The Buddha’s Birthday* The first working day after the Buddha’s Birthday# Tung Ng Festival The first working day after the Tung Ng Festival# Bank’s Holiday The day following Chinese Mid-Autumn Festival National Day Chong Yeung Festival All Soul’s Day Feast of the Immaculate Conception* The first working day after the Feast of the Immaculate Conception# Macao SAR Establishment Day Winter Solstice* Christmas Eve Christmas Day Bank’s Holiday New Year’s Eve (Afternoon)#
01
Jan
2012
01
Jan
02 Feb Feb 23 - 25 Apr 04 Apr 06 Apr 07 Apr 09 May 01 May 28
Jan Jan Apr Apr Apr Apr May Apr
06
Jun
30 23
Apr Jun
01
Jul
25 02
Jun Jul
13 01 - 03 05 02
Sep Oct Oct Nov
01 01 23 02
Oct Oct^ Oct Nov
08
Dec
08
Dec
20 22 24 25 - 26 27 -
Dec Dec Dec Dec Dec -
10 20 21 24 25 26 31
Dec Dec Dec Dec Dec Dec Dec
02 03 - 05 05 22 23 25 01 - 02 10
* Not applicable to Bank # Special Holiday Granted by Chief Executive. ^ As the day following Chinese Mid-Autumn Festival and National Day fall on the same day, one additional holiday will be granted following the National Day.
2011 HONG KONG
The First day Of January Lunar New Year’s Day Ching Ming Festival Good Friday Easter Monday Buddha’s Birthday Labour Day Tuen Ng Festival HKSAR Establishment Day The day following Chinese Mid-Autumn Festival National Day Chung Yeung Festival Christmas Day
2012
01 03 - 05 05 22 - 23 25 10 01 - 02 06 01
Jan 01 Feb 23 - 25 Apr 04 Apr 06 - 07 Apr 09 May 28 May 01 Jun 23 Jul 01
Jan# Jan Apr Apr Apr Apr May Jun Jul#
13 01 05 25 - 27
Sep 01 Oct 01 Oct 23 Dec 25 - 26
Oct* Oct* Oct Dec
# When public holiday falls on Sunday, the following Monday is an alternative holiday. * As the day following Chinese Mid-Autumn Festival and National Day fall on the same day, one additional holiday will be granted following the National Day. INDONESIA
New Year’s Day Chinese New Year (Imlek) Prophet Muhammad’s Birthday Hindu Day of Quiet (Nyepi) Good Friday Waicak Day (Buddha Birthday) Ascension Day of Jesus Christ Ascension Day of Prophet Muhammad* National Independence Day Idul Fitri* Idul Adha Day Hijriyah New Year Christmas Day * Subject to change
01 03 15 05 22 17 02
Jan Feb Feb Mar Apr May May
01 23 05 23 06 06 17
Jan Jan Feb Mar Apr May May
29 17 30 31 06 27 25
Jul Aug Sep Sep Nov Dec Dec
17 17 19 20 26 15 25
Jun Aug Aug Aug Oct Nov Dec
PUBLIC HOLIDAYS 2011 INDIA
New Year’s Day Sankranthi Republic Day Good Friday May Day Independence Day Gandhi Jayanthi Karnataka Formation Day Deepavali Christmas Day
01 14 26 22 01 15 02 01 26 25
Jan Jan Jan Apr May Aug Oct Nov Oct Dec
2012
01 14 26 06 01 15 02 01 13 25
Jan Jan Jan Apr May Aug Oct Nov Nov Dec
2011 KOREA
New Year’s Day Lunar New Year (Seol) Independent Movement Day Buddha’s Birthday Children’s Day Memorial Day Liberation Day Full Moon Day (Chuseok) National Foundation Day Christmas Day
2012
Jan 01 Feb 23 - 24 Mar 01 May 28 May 05 Jun 06 Aug 15 Sep 29 - 01 Oct 03 25 Dec
Jan Jan Mar May May Jun Aug Oct Oct Dec
01 21 22 09 01 12 31 30 07 30 25 30
Jan Apr Apr Apr May Jun Aug Aug Nov Nov Dec Dec
01 05 06 09 01 12 19 30 26 30 25 30
Jan Apr Apr Apr May Jun Aug Aug Oct Nov Dec Dec
21 01 31
Aug Nov Dec
21 01 31
Aug Nov Dec
01 02 - 04 01 10 05 06 15 11 - 13 03 25
PHILIPPINES (Regular Holidays) Regular Holidays JAPAN
New Year’s Day* Coming of Age Day National Foundation Day* Spring Equinox Day* Day of Showa* Constitution Memorial Day* Greenery Day* Children’s Day* Marine Day Respect-for-Senior-Citizens Day Autumnal Equinox Day* Physical Fitness Day Cultural Day* Labor Thanksgiving Day* The Emperor’s Day*
01 10 11 21 29 03 04 05 18 19 23 10 03 23 23
Jan Jan Feb Mar Apr May May May Jul Sep Sep Oct Nov Nov Dec
02 09 11 20 30 03 04 05 16 17 22 08 03 23 23
Jan Jan Feb Mar Apr May May May Jul Sep Sep Oct Nov Nov Dec
*When Public Holiday falls on Sunday, the following Monday is an alternative holiday.
New Year’s Day Maundy Thursday Good Friday Araw ng Kagitingan Labour Day Independence Day End of Eid-ul-Fitre National Heroes’ Day Eid-ul Adha Bonifacio Day Christmas Day Rizal Day Special Holidays (Non Working Holidays)
Ninoy Aquino Day All Saint’s Day Last Day of the Year
PUBLIC HOLIDAYS 2011 SINGAPORE
New Year’s Day Chinese New Year Good Friday Labour Day Vesak Day National Day Hari Raya Puasa Hari Raya Haji Deepavali* Christmas Day
01 03 - 04 22 01 17 09 30 06 26 25
2012
Jan 01 Feb 23 - 24 Apr 06 May 01 May 05 Aug 09 19 Aug Nov 26 13 Oct Dec 25
Jan^ Jan Apr May May Aug Aug^ Oct Nov Dec
*Subject to changes ^ The following Monday will be a public holiday TAIWAN
01 Founding Day 02 Lunar New Year’s Eve 03 - 07 Lunar New Year Replacement Holiday 28 Peace Memorial Day Woman Day and Children’s Day 04 05 Ching Ming Festival 01 Labour Day 06 Dragon Boat Festival 12 Mid-Autumn Festival 10 Double Ten Day Replacement Holiday
Jan 01 Feb 22 Feb 23 - 27* 27 Feb 28 Apr 04 Apr 04 May 01 Jun 23 Sep 30 Oct 10 31
Jan Jan Jan Feb@ Feb Apr Apr May Jun Sep Oct Dec#
* As 4-Feb is adjusted to work, this day is adjusted to holiday. @ As 3-Mar is adjusted to work, this day is adjusted to holiday. # As 22-Dec is adjusted to work, this day is adjusted to holiday.
2011 THAILAND
New Year’s Day 03 Chinese New Year* 03 Makha Bucha Day 18 Chakri Memorial day 06 Songkran Festival 13 - 15 National Labour Day 02 Coronation Day 05 + Royal Ploughing Ceremony Day 13 Visakha Bucha Day 17 # Mid Year Bank Holiday 01 Asarnha Bucha Day 15 Khao Phansa Day (Buddhist Lent)+ 18 H.M. The Queen’s Birthday 12 Chulalongkorn day 24 H.M. The King’s Birthday 05 Constitution Day 12 New Year’s Eve 31
2012
Jan 02 Feb 23 Mar 07 Apr 06 Apr 13 - 16 May 01 May 07 May 09 May 04 Jul 01 Jul 02 Jul 03 Aug 13 Oct 23 Dec 05 Dec 10 Dec 31
Jan1 Jan Mar Apr Apr2 May May3 May Jun Jul Aug Aug Aug4 Oct Dec Dec Dec
*Unofficial Chinese Community Only # Banks only + Government only 1 Substitute for 31 Dec 2011 (Sat) 2 Substitute for 14 Apr (Sat) 3 Substitute for 05 May (Sat) 4 Substitute for 12 Aug (Sun) VIETNAM (Normal Scheduled Holidays)
Solar New Year Lunar New Year Hung Vuong King Celebration Liberation Day of Saigon International Labour Day National Day Christmas Day * Substitute for 1 Jan (Sun) ** Substitute for 22 Jan (Sun) # Substitute for 31 Mar (Sat) ^ Substitute for 2 Sep (Sun)
03 03 - 07 12 02 03 02 25
Jan 02 Feb 23 - 26** Apr 02 May 30 May 01 Sep 03 Dec 25
Jan* Jan Apr# Apr May Sep^ Dec
ABOUT US First established in 1934 in Singapore under the name "Waters and Watson" we survived the Second World War to become the pre-eminent Quantity Surveying and Construction cost Management firm in Asia - operating for many years as Langdon Every and Seah. One of our early partners, Mr. Seah Mong Hee, was the first Chartered Surveyor (RICS) in the world. Our Hong Kong office opened in 1949 and we quickly established ourselves as the leading firm in the profession. Following a series of global mergers, Davis Langdon & Seah International was founded in 1990. As we begin 2012, Davis Langdon & Seah has grown to almost 3,000 staff in 40 offices across Asia, and continues to cooperate with Davis Langdon in Europe & Middle East, USA, Australia & New Zealand and Africa - forming a network of over 100 offices across more than 30 contries. We entered the China market in 1984, introducing modern cost management techniques to its newly evolving construction market. Our initial commissions were from Hong Kong and foreign developers investing in China, although we have since then further developed our client base to include state owned enterprises and local privatedevelopers. We now have 16 offices across China located in Hong Kong, Shanghai, Beijing, Guangzhou, Shenzhen, Macau, Chongqing, Wuhan, Tianjin, Shenyang, Chengdu, Foshan, Hangzhou, Dalian, Sanya and Suzhou with a total staff count of around 1,400. For over 60 years, DLS Hong Kong/China has been proactively providing world-class construction consulting services for all types of building and infrastructure projects. We are committed to further extending our professional expertise to related fields and further expanding our activities in China to support the needs of our clients as they explore one of the world's largest and fastest growing markets.
QUALITY MANAGEMENT SYSTEM Nowadays an effective Quality Management System is one of the core elements in any kind of business. Davis Langdon and Seah Hong Kong Limited aims to provide not merely quantity surveying services but also the highest quality services to meet clients' requirements. We launched our Quality Management System in 1993 and have continually upgraded our quality standards since then. Davis Langdon & Seah Hong Kong Limited achieved certification to ISO 9001: 1987 by the Hong Kong Quality Assurance Agency in October 1994 to cover quantity surveying services. We were certifies to ISO 9001: 1994 in October 1995. The following further displays our commitment to the continual improvement of our Quality Management System: (i) June 2009 saw Davis Langdon & Seah Hong Kong Limited being certified to the ISO 9001: 2008 standard. (ii) In December 2009, the Hong Kong office of Davis Langdon & Seah China Limited was certified to the ISO 9001:2008 standard. (iii) In September 2010, Davis Langdon & Seah Macau Limited was certified to the ISO 9001:2008 standard. Plans are currently well advanced to further extend our HKQAA ISO certification to all our offices in China.
CONSTRUCTION COSTS FOR HONG KONG HK$/m 2 BUILDING TYPE
BUILDING
SERVICES
TOTAL
DOMESTIC
Public rental housing, high rise Private housing estates, high rise Private luxury apartments, high rise Terraced houses Individual prestige houses
6,055 14,035 15,805 19,065 27,485
- 6,810 - 14,780 - up - 20,490 up
1,045 2,455 3,325 2,255 2,455
-
1,350 3,320 4,220 2,860 3,610
7,100 - 8,160 16,490 - 18,100 19,130 up 21,320 - 23,350 29,940 up
12,340 - 13,350 16,470 up 11,840 - 14,770 16,420 up
4,150 4,850 4,700 4,900
-
5,280 6,130 5,430 6,130
16,490 - 18,630 21,320 up 16,540 - 20,200 21,320 up
15,070 - 16,630 21,470 up
4,930 5,330 -
5,700 6,550
20,000 - 22,330 26,800 up
OFFICE/COMMERCIAL
Average standard office, high rise Prestige offices, high rise Average standard shopping centres Prestige shopping centres HOTELS
3-star budget hotels, inclusive of F.F. & E. 5-start luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories, 7.5 kpa (150lb.) loading Heavy duty flatted factories and warehouses, 15 kpa (300 lb.) loading
6,980 -
7,410
1,750 -
2,330
8,730 -
9,740
7,640 -
8,590
2,000 -
2,580
9,640 - 11,170
1,300 2,050 3,000 3,150 5,350
2,050 2,850 3,950 3,950 6,900
OTHERS
Carparks, above ground Primary and secondary schools International schools Student hostels Sports clubs inclusive of F.F. & E. The above costs are at 4th Quarter 2011 levels.
6,210 9,120 10,960 8,790 15,270
- 6,480 - 9,330 - 11,680 - 10,060 - 16,970
-
7,510 11,170 13,960 11,940 20,620
-
8,530 12,180 15,630 14,010 23,870
M&E COSTS FOR HONG KONG HK$/m 2 BUILDING TYPE
MECHANICAL ELECTRICAL SERVICES SERVICES
FIRE LIFTS/ HYDRAULIC SERVICES ESCALATORS SERVICES
TOTAL SERVICES
DOMESTIC
Public rental housing, high rise Private housing estates, high rise Private luxury apartments, high rise Terraced houses Individual prestige houses
-450 - 550 650 - 850 850 - 1,050 1,100 - 1,300 1,050 - 1,300 850 - 1,100 850 - 1,050 850 - 1,400 1,050 - 1,500
75 75 75 55 55
-
120 120 120 110 110
200 - 250 330 - 550 450 - 650 ---
320 550 650 500 500
-
430 750 850 600 600
1,045 - 1,350 2,455 - 3,320 3,325 - 4,220 2,255 - 2,860 2,455 - 3,610
430 430 430 430
-
550 550 550 550
550 650 650 650
270 270 270 270
-
380 380 380 380
4,150 - 5,280 4,850 - 6,130 4,700 - 5,430 4,900 - 6,130
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Average standard shopping centres Prestige shopping centres
1,600 - 1,950 1,900 - 2,350 1,950 - 2,150 1,950 - 2,400
1,300 - 1,650 1,600 - 1,950 1,400 - 1,600 1,600 - 1,950
-
750 900 750 850
HOTELS
3-star budget hotels, inclusive of F.F. & E. 5-start luxury hotels, inclusive of F.F. & E.
1,750 - 1,950 1,500 - 1,750 1,850 - 2,150 1,750 - 2,150
430 - 550 430 - 550
450 - 550 450 - 650
800 - 900 850 - 1,050
4,930 - 5,700 5,330 - 6,550
INDUSTRIAL
Light duty flatted factories, 7.5 kpa (150 lb.) loading
380 - 500
450 - 650
250 - 300
450 - 550
220 - 330
1,750 - 2,330
Heavy duty flatted factories and warehouses, 15 kpa (300 lb.) loading
380 - 500
650 - 850
250 - 300
500 - 600
220 - 330
2,000 - 2,580
250 250 250 350 450
250 150 150 150 250
150 250 250 600 350
1,300 - 2,050 2,050 - 2,850 3,000 - 3,950 3,150 - 3,950 5,350 - 6,900
OTHERS
Carparks, above ground Primary and secondary schools International schools Student hostels Sports clubs inclusive of F.F. & E. The above costs are at 4th Quarter 2011 levels.
200 - 550 450 - 650 550 - 850 850 - 1,050 1,300 - 1,600 1,050 - 1,400 650 - 850 1,400 - 1,600 2,500 - 3,000 1,800 - 2,500
-
300 350 350 450 600
-
350 250 250 250 350
-
200 350 350 800 450
BUILDING COST TRENDS IN HONG KONG INDEX
(Base = 100, at Year 1970)
YEAR Q1
Q2
Q3
Q4
2000
1,079
1,057
1,040
1,020
2001
990
960
945
935
2002
915
890
875
840
2003
855
878
895
895
2004
940
952
933
930
2005
945
955
963
970
2006
970
980
985
990
2007
1,020
1,074
1,175
1,150
2008
1,239
1,360
1,355
1,281
2009
1,245
1,242
1,253
1,273
2010
1,297
1,315
1,342
1,367
2011
1,385
1,425
1,452
1,476*
* Provisional Historical TPI values from 1970 onwards available at www.dlsqs.com.
INDEX
(Base = 100, at Year 1970)
YEAR Q1
Q2
Q3
Q4
2000
959
873
858
844
2001
862
842
807
721
2002
687
742
692
733
2003
720
723
722
681
2004
685
712
704
701
2005
711
716
718
697
2006
714
730
751
789
2007
821
859
906
998
2008
1,118
1,305
1,401
1,262
2009
1,074
983
1,111
1,107
2010
1,134
1,161
1,249
1,266
2011*
1,273
1,320 * Up to Q2 only
Source: Architectural Services Department, Hong Kong, SAR Refer to www.archsd.gov.hk for further information.
YEAR
HYD CONST. COST INDEX
(Nov. 1975 Value = 100)
CEDD CIVIL ENGINEERING WORKS INDEX
(1980 Value = 100)
2000
844
419
2001
838
416
2002
839
416
2003
848
419
2004
871
428
2005
869
429
2006
886
436
2007
917
450
2008
1,031
500
2009
950
461
2010
989
481
2011*
1,061
518
* 1/11 to 8/11 only Source: Civil Engineering and Development Department, Hong Kong, SAR Refer to www.cedd.gov.hk/eng/index.htm for further information.
LABOUR INDEX IN HONG KONG
INDEX
(Base = 100, at June 1995)
YEAR Q1
Q2
Q3
Q4
2000
152
153
154
154
2001
152
152
152
151
2002
150
150
149
148
2003
147
146
146
143
2004
143
140
140
138
2005
137
136
133
132
2006
131
133
134
136
2007
137
135
131
130
2008
129
128
128
129
2009
129
128
129
130
2010
131
131
131
132
2011*
133
134
* Up to Q2 only Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information. Figures above are the quarterly average of the monthly indices
MATERIAL PRICES IN HONG KONG GALVANIZED MILD STEEL ANGLE
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
REBAR
SAND
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
ORDINARY PORTLAND CEMENT
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
COPPER GRADE A
CRUDE OIL
Source: International Monetary Fund Refer to www.imf.org for further information.
Source: Organization of the Petroleum Exporting Countries (OPEC) Refer to www.opec.org for further information.
ESTIMATING RULES OF THUMB AND DESIGN NORMS FOR HONG KONG CFA TO GFA RATIO Building Type
AVERAGE PILING RATIO - BORED PILES CFA : GFA
Building Type
m2 CFA / m2 cross section area of piles
Residential
1.15 to 1.25 : 1
Office / Commercial
1.15 to 1.25 : 1
Residential
200 - 300
Hotel
1.30 to 1.45 : 1
Office / Commercial
200 - 250
Hotel
200 - 300
FUNCTIONAL AREA DISTRIBUTION IN 5-STAR HOTELS Functional Area
% of Total Hotel CFA
AVERAGE PILING RATIO - DRIVEN H-PILES
Front of House
15 - 20%
Building Type
m2 CFA / No. of piles
Guestroom Floors
50 - 60%
Residential
50 - 90
Back of House
25 - 30%
Office / Commercial
50 - 80
Hotel
50 - 90
DIMENSIONS OF TYPICAL GRADE A OFFICE SPACE Component Distance from curtain wall to core wall Population Average waiting interval for lifts
Dimension 9 - 13 m 9 m2 usable floor area/person 30 - 40 seconds
DENSITY OF BASIC MATERIALS FOR STRUCTURE Material
2,400 kg/m3
Cement
1,450 kg/m3
Sand
1,600
Aggregate
1,600 kg/m3
Steel
7,843 kg/m3
kg/m3
Barge
m2 CFA / No. of piles
Residential
70 - 120
Office / Commercial
70 - 110
Hotel
70 - 120
All pile ratios are for high-rise buildings with normal soil conditions.
BUILDING STRUCTURE - CONCRETE RATIO Concrete/floor area
0.4 m3/m2 to 0.5 m3/m2
Formwork/floor area
2.2 m2/m2 to 3.0 m2/m2
Reinforcement
160 kg/m3 to 250 kg/m3
AVERAGE EXTERNAL WALL/FLOOR RATIO
AVERAGE LOADS VOLUME Concrete truck (24 ton)
Building Type
Density
Concrete
Lorry (24 ton)
AVERAGE PILING RATIO - PRE-BORED H-PILES
10.0 m3 5.5 m3 200 - 1,450 m3
Residential Apartments
1.0 m2/m2
Office, Hotel
0.4 m2/m2
Industrial
0.4 m2/m2
DIMENSIONS OF PARKING SPACES
AVERAGE INTERNAL WALL/FLOOR RATIO
Residential Apartments Office Hotel
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particularly small foot prints. AVERAGE LIGHTING LEVEL Building Type
Lux
Residential Office Retail Hotel School
300 500 400 300 300 - 500
Type of Vehicle
Length
Minimum Width Headroom
Private Cars and Taxis
5m
2.5 m
2.4 m
Light Goods Vehicles
7m
3.5 m
3.6 m
Medium/Heavy Goods Vehicle
11 m
3.5 m
4.7 m
Container Vehicles
16 m
3.5 m
4.7 m
Coaches and Buses
12 m
3.5 m
3.8 m
8m
3m
3.3 m
Light buses
Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilation ducts, conduits or similar
AVERAGE POWER DENSITY Building Type
VA/m2 CFA
Residential Office Retail Hotel - Accommodation Hotel - F&B Area School
80 - 100 70 300 - 400 30 550 50
AVERAGE COOLING LOAD Building Type
Residential Office Retail Hotel School
m Cooling Area/RT 2
18 - 23 14 - 18 12-14 23 23
INDICATIVE DIMENSIONS FOR SPORTS GROUNDS Length
Width
Tennis Court
40 m
20 m
Squash Court
10 m
6.4 m
Basketball Court
34 m
20 m
Volleyball Court
36 m
20 m
Badminton Court
20 m
10 m
Ice Rink
61 m
26 m
120 m
90 m
Soccer Pitch
The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed.
CONSTRUCTION ACTIVITY IN HONG KONG
YEAR
* #
COMPLETED m2
CONSENT TO COMMENCE m2
2000
1,515,000
1,850,000
2001
1,354,000
1,388,000
2002
1,908,000
1,372,000
2003 #
1,587,000
1,683,000
2004 #
1,720,000
1,115,000
2005 #
1,227,000
1,476,000
2006 #
1,389,000
1,398,000
2007 #
1,030,000
1,539,000
2008 #
1,097,000
997,000
2009 #
815,000
1,075,000
2010 #
1,139,000
1,210,000
2011 #*
750,000
791,000
1/11 to 9/11 onl y As from January 2003 onwards, statistics by Buildings Department on "Consent to Commence" are published with 2 sub-divisions, viz. "First Submission" and "Major Revision". Details can be found in the Buildings Department's "Monthly Digest".
Source: Census and Statistics Department, Hong Kong, SAR Buildings Department, Hong Kong , SAR Refer to www.censtatd.gov.hk and www.bd.gov.hk for further information.
CONSTRUCTION VALUE IN HONG KONG
YEAR
VALUE IN NOMINAL TERMS HK$ MILLIONS
VALUE IN CONSTANT (2000) MARKET PRICE HK$ MILLIONS
2000
122,071
114,691
2001
113,986
111,385
2002
106,000
108,677
2003
99,032
106,274
2004
93,171
100,615
2005
90,851
98,275
2006
90,230
96,269
2007
92,866
96,844
2008
99,599
97,024
2009
100,944
93,683
2010
111,274
100,278
2011*
91,332
78,106
* 1/11 to 9/11 only Source:
Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
FIREE RECORDALS TRACKER: NOVEMBER 2011 UPDATE Since May 2007, any injection of foreign capital in foreigninvested real estate enterprises (FIREEs) must be recorded with the PRC Ministry of Commerce (MOFCOM). These “FIREE recordals” provide a useful perspective on the trend and pace of new foreign capital inflow into the China real estate sector. However, the FIREE recordal statistics do not disclose the actual amount of foreign capital involved in each transaction. Baker & McKenzie has been tracking FIREE recordals announced by MOFCOM since May 2007. Set out below are some FIREE recordal statistics and data current up to the end of November 2011. In summary: ○ The total number of FIREE recordals for November 2011 was 95, up from 60 in October 2011. ○ The total number of FIREE recordals in 2008, 2009 and 2010 were 1,051, 991 and 1,094 respectively. ○ Since May 2007, cumulatively, there have been 5,614 FIREE recordals up to the end of November 2011. This includes 2,486 cases of new project operating entities being established, 2,562 cases of capital increase or M&A transactions (involving capital increase) related to existing project operating entities, and 238 cases of M&A transactions which do not involve any capital increase. 1.
FIREE recordals: monthly from 1 Jan 2009 to 30 Nov 2011:
2.
Cities with the highest number of FIREE recordals from May 2007 to Nov 2011:
3.
Types of FIREE recordals from May 2007 to Nov 2011:
About the FIREE Recordal Regime The regulatory regime for recording foreign-invested real estate enterprises was first established in May 2007 by MOFCOM and the State Administration of Foreign Exchange (SAFE). This “FIREE recordal” regime was part of a scheme of regulatory measures introduced between 2006 to 2007 to monitor and control foreign investment in the real estate sector at a time when the central government considered the real estate sector to be overheated. This regime controls all types of foreign capital inflow being injected into the real estate sector for purposes such as the setting up of new entities, capital increases and mergers & acquisitions. Foreign capital flowing into China cannot be converted into Renminbi (China’s legal currency) unless and until the “FIREE recordal” process has been completed with MOFCOM and SAFE. Since July 2008, the provincial-level commerce authorities have been charged with the primary responsibility of vetting the legal compliance of FIREE-related transactions. MOFCOM reserves the right to conduct random checks on the recordals filed by the provincial-level commerce authorities. Generally, within one to two weeks of receiving an electronic submission from a provincial-level commerce authority, MOFCOM will release the new FIREE recordal on its public website. Only then can the local bureau of SAFE and the local commercial bank credit the foreign currency funds into the accounts of the transaction parties concerned. In December 2008, MOFCOM further simplified the local recordal procedures such that the general office of the provincial governemnt is no longer required to jointly endorse the recordal form with the provincial-level commerce authority. In December 2010, MOFCOM announced Notice 1542, which requires local bureaus of MOFCOM to use the FIREE recordal regime to slow down new foreign investment into the PRC real estate sector.
Provided by : Mr. Rico Chan
Partner Baker & McKenzie Hong Kong Office +852 2846 1971 [email protected]
Ms. Barbara Li
Partner Baker & McKenzie Beijing Office +86 10 6535 3824 [email protected]
HONG KONG GENERAL CONSTRUCTION INSURANCE This section provides general information regarding construction insurance arrangements in Hong Kong. It is common place for Hong Kong construction contracts to contain provisions as to insurances such as Employees Compensation Insurance, Third Party Liability Insurance, Works Insurance and, on occasion, Professional Liability Indemnity Insurance. For employers, the insurance placement ensures that the contractual indemnities are backed by a financial institution that can afford to pay. For contractors, it provides a certain degree of protection to ensure that he has the means to pay in the event of mishaps. The insurances may be effected by the contractor (Contractor Controlled Insurance Programme or CCIP) or be taken out by the employer (Employer Controlled Insurance Programme or ECIP). CCIP tends to be the most common insurance arrangement in Hong Kong, since the contractor is in control of all site operations and in a better position to manage its own site safety / risk. As a poor safety record will count against the contractor in premiums negotiation in the procurement of insurance, CCIP provides an incentive for better safety / risk management. On the other hand, ECIP placement leaves the control of the insurance programme in the hands of the employer, thereby offering the advantage of providing comprehensive insurance coverage on a project-wide basis and hence minimizing overlaps and gaps in insurance coverage. Employees Compensation Section 40(1) of the Employees Compensation Ordinance states that no employer shall employ any employee unless there is a policy of Employees Compensation Insurance in place. The maximum penalty for failing to comply with HK$100,000. Under the Ordinance, the principal contractor shall take out insurance for his employees and all of the employees of subcontractors with a limit of indemnity of HK$200 million per event (or HK$100 million if the number of employees is less than 200). Since an injured worker could attempt to sue the employer, the employer will want to ensure the contractor has taken out insurance in joint names with the employer. Contractors' All Risks Insurance A Contractors' All Risks policy generally comprises (i) Third Party Insurance which covers injury to persons (except the Contractor’s own workmen) or damage to property (other than the Works), due to the carrying out of the Works which may or may not be caused by a default of the contractor. The policy is normally subject to a maximum reimbursement per incident but unlimited in the number of incidents, (ii) Contract Works Insurance which covers damage caused to the Works itself by risks not excluded from the policy and (iii) Plant & Equipment Insurance which covers the contractor’s plant and equipment used in the Works. Plant & Equipment Insurance is not normally required under the contract conditions and is voluntarily purchased by the contractor.
ACMV COSTS FOR VARIOUS DESIGNS AND DEVELOPMENTS IN HONG KONG
Professional Indemnity Insurance For construction contracts involving contractor’s design, it is not uncommon for the employer to require the contractor and his design consultants and independent checking engineers to obtain insurance to cover their liability for design. For Government Contracts, the Professional Indemnity Insurance shall cover the contractor's liability for design generally for the construction period and a further 6 years.
SPECIFIED FORMS FOR BUILDINGS ORDINANCE OR REGULATIONS FOR HONG KONG FORM NO.
PURPOSE
RELEVANT SECTION OF REGULATION
BA1
Application for inclusion in the authorized persons' register / structural engineers' register / geotechnical engineers' register. BOs 3(6)
BA1A
Application for retention of name in the authorized persons' register / structural engineers' register / geotechnical BOs 3(9B) engineers' register.
BA1B
Application for restoration of name to the authorized persons' register / structural engineers' register / geotechnical BOs 3(12) engineers' register.
BA2
Application for registration as a general building contractor / specialist contractor.
BOs 8B
BA2A
Application for renewal of registration as a registered general building contractor / registered specialist contractor.
BOs 8C(2)
BA2B
Application for restoration of name to the register of general building contractors / specialist contractors.
BOs 8D(2)
BA2C
Application for approval of technical director / other office / person appointed to act for the purposes of the Building BOs 8B Ordinance for a registered general building contractor / registered specialist contractor.
BA4
Notice of appointment of authorized person and/or registered structural engineer and/or registered geotechnical engineer. B(A)R 23(1A)
BA5
Application for approval of plans of building works and/or street works, and certificate of preparation of plans.
B(A)R 29(1) & 18A
BA6
Stability certificate of authorized person and/or registered structural engineer.
B(A)R 18
BA7
Notice of urgent works required as a result of accident or emergency.
BOs 19(3), B(A)R 28
BA8
Application for consent to the commencement and carrying out of building works or street works.
B(A)R 31
BA9
Application for renewal of consent to the carrying out of building works or street works.
BOs 20(2)
BA10 BA11
Notice of appointment of registered contractor, notice of commencement of building works or street works and undertaking B(A)R 20 by registered contractor. Notice from a registered contractor on ceasing to be appointed in respect of building works or street works and certificate B(A)R 24 in respect of that part of the building works or street works carried out by the registered contractor.
BA12
Certificate on completion of building works resulting in a new temporary building, a new building or part of a new building B(A)R 25, BOs 21(2) and application for temporary occupation permit in respect of such building or part.
BA13
Certificate on completion of building works resulting in a new building and application for permit to occupy such building. B(A)R 25, BOs 21(2)
BA14
Certificate on completion of building works not resulting in a new building or street works.
B(A)R 25 & 26
BA14A
Certificate on completion of demolition works
B(A)R 25
BA15
Notice of intended material change in the use of a building.
BOs 25(1)
BA16
Application for modification of and/or exemption from the provisions of the Buildings Ordinance and/or Regulations made thereunder.
BOs 42(2)
BA17
Application for permit to erect a temporary building.
B(P)R 51
BA18
Application for permit to erect a contractor's shed.
B(P)R 53(1)
BA19
Application for permit to erect hoardings, covered walkways or gantries.
B(P)R 64
BA20
BA22
Notice of technically competent person or persons appointed to supervise demolition works. B(DW)R 8(3) Notice of nomination by authorized person or registered structural engineer or registered geotechnical engineer of another authorized person or registered structural engineer or registered geotechnical engineer to act in his stead during B(P)R 23(2) temporary inability to act. Application for authorization to carry out and/or maintain groundwater drainage works. BOs 28B(1)
BA23
Application for grant/renewal of licence for an oil storage installation.
B(OSI)R 6(1) & 7(3)
BA24
Notification to the Building Authority of change of business address of authorized person / registered structural engineer / registered general building contractor / registered specialist contractor.
B(A)R 45
BA21
Source : Buildings Department, Hong Kong, SAR. Refer to www.bd.gov.hk for further information.
SUMMARY OF BUILDING REGULATIONS FOR HONG KONG DESCRIPTION
NUMBER OF REGULATIONS
Administration
48
Appeal
14
Construction
93
Demolition Works
13
Energy Efficiency
6
Oil Storage Installations
12
Planning
72
Private Street and Access Roads
28
Refuse Storage Chambers and Chutes
25
Standards of Sanitary Fitments, Plumbing, Drainage Works and Latrines
91
Ventilating Systems
7
Source: Buildings Ordinance, Hong Kong, SAR Refer to www.legislation.gov.hk for further information.
PERCENTAGE SITE COVERAGE AND PLOT RATIOS FOR HONG KONG DEFINITION Class A Site
OPEN SPACE ABOUT DOMESTIC BUILDINGS
:
Not being a class B or class C site, that abuts on one street not less than 4.5 m wide or on more than one such street.
Class B Site
:
A corner site that abuts on 2 streets either of which is less than 4.5 m wide.
Class C Site
:
A corner site that abuts on 3 streets none of which is less than 4.5 m wide.
DOMESTIC BUILDINGS
Height of Building in metres
Percentage site coverage
Item
Class of site
Open space required
1.
Class A site
Not less than one-half of the roofed-over area of the building
2.
Class B site
Not less than one-third of the roofed-over area of the building
3.
Class C site
Not less than one-quarter of the roofed-over area of the building
NON-DOMESTIC BUILDINGS
Percentage site coverage
Plot Ratio
Class Class Class Class Class Class C B A C B A site site site site site site
Plot Ratio
Class A site
Class B site
Class C site
Class A site
Class B site
Class C site
Not over 15 m
66.6
75
80
3.3
3.75
4.0
100
100
100
5
5
5
15 m to 18 m
60
67
72
3.6
4.0
4.3
97.5
97.5
97.5
5.8
5.8
5.8
18 m to 21 m
56
62
67
3.9
4.3
4.7
95
95
95
6.7
6.7
6.7
21 m to 24 m
52
58
63
4.2
4.6
5.0
92
92
92
7.2
7.4
7.4
24 m to 27 m
49
55
59
4.4
4.9
5.3
89
90
90
8.0
8.1
8.1
27 m to 30 m
46
52
55
4.6
5.2
5.5
85
87
88
8.5
8.7
8.8
30 m to 36 m
42
47.5
50
5.0
5.7
6.0
80
82.5
85
9.5
9.9
10.2
36 m to 43 m
39
44
47
5.4
6.1
6.5
75
77.5
80
10.5
10.8
11.2
43 m to 49 m
37
41
44
5.9
6.5
7.0
69
72.5
75
11.0
11.6
12.0
49 m to 55 m
35
39
42
6.3
7.0
7.5
64
67.5
70
11.5
12.1
12.6
55 m to 61 m
34
38
41
6.8
7.6
8.0
60
62.5
65
12.2
12.5
13.0
33.33
37.5
40
8.0
9.0
10.0
60
62.5
65
15
15
15
Over 61 m Source:
Buildings Ordinance, Hong Kong, SAR Refer to www.legislation.gov.hk for further information.
CONSTRUCTION COST SPECIFICATION FOR HONG KONG The costs for the respective categories given on the previous pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, balconies, plant rooms, water tanks and the like. All buildings are assumed to have no basement (unless otherwise stated) and to be built on flat ground, with normal soil conditions. The costs exclude external works, land costs, professional fees, finance and legal expenses. The standards for each category of buildings vary from country to country. Standards representing by the construction costs of other regions published hereinafter do not necessarily follow those of Hong Kong. DOMESTIC Public rental housing is based on Hong Kong Housing Authority Non-standard Cruciform Block design. Private housing estates are based on blocks containing 30-50 storeys, with average unit size not greater than 100 m2. Single glazed windows. Tiled or plastered finishes in general. Air conditioning, kitchen cabinets and home appliances are included for private housing estates, private luxury apartments, terraced houses and prestige houses. All types of domestic construction include provision of functional light fittings only and no feature light fittings have been allowed. Fitting out works and loose furniture are also not included. OFFICE/COMMERCIAL Office based on buildings 20-30 storeys high with floor plans minimum 1,000 m2 per level.I Average standard offices and shopping centres exclude finishes, A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations and granite finishes lobbies, with raised floor, suspended ceiling, A/C ducting and light fittings to tenants areas. INDUSTRIAL Flatted factories exclude manufacturing equipment, airconditioning, electrical distribution systems and special services provisions to tenants areas.
HOTELS F.F. & E. includes interior decoration and loose furniture etc. but excludes pre-opening expenses and hotel operation system and equipment costs (e.g. cutlery, crockery, linen, uniform, etc.). Includes 1 level of basement. OTHERS Carparks to be multi-storey. Primary and secondary schools with standard government provisions. International Schools with upgraded facilities. Student hostels to university standard. Sports club to the standard of the Government's indoor recreational centre.
FIT-OUT COSTS FOR HONG KONG BUILDING TYPE
HK$/m 2
BUILDING TYPE
HOTELS
DEPARTMENT STORES
Public Areas (Front of House) :
General department store
3-star Hotel
7,600 - 11,500
4-star Hotel
12,000 - 16,000
5-star Hotel
17,000
up
Guest Rooms : 3-star Hotel
6,000 - 7,400
4-star Hotel
7,500 - 10,000
5-star Hotel
10,000
up
Notes : 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, building shell, chandeliers, operational items and equipment (e.g. cutlery, crockery, linen, television, refrigerator etc.)., openinig expenses, stage equipment and computer systems.
10,000
up
Notes : 1. Includes electrical work, additional FCU and minor alteration of fire services to suit layout. 2. Excludes facade modification, data cabling, operational items and equipment (e.g. computers, P.O.S, office equipment) and opening expenses.
General dining restaurant Fine dining restaurant
General office
4,800 - 7,400
Executive office
7,500 - 10,500
Notes : 1. Local/Taiwanese/PRC furniture allowed for general offices 2. Includes furniture, partitioning, electrical work, minor alteration to air-conditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, data cabling, office equipment (e.g. computers, photocopiers, fax machines, UPS, etc).
6,000 - 9,300
RESTAURANTS
OFFICES
Prestige office
Prestige department store
HK$/m 2
10,500
up
Notes : 1. Includes furniture, floor, wall and ceiling finishes, electrical work, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen 2. Excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.).
7,600 - 15,000 16,000
up
UNIT COSTS FOR ANCILLARY FACILITIES FOR HONG KONG DESCRIPTION
UNIT
HK$
DESCRIPTION
UNIT
SQUASH COURTS
SAUNAS
Single court with glass backwall including associated mechanical and electrical services but excluding any public facilities (enclosing structure not included). per court
Sauna room for 4-6 people complete with all accessories (enclosing structure not included). per room
HK$
130,000
420,000 STEAM BATHS
Steam bath for 4-6 people complete with all accessories (enclosing structure not included). per room
TENNIS COURTS
Single court on grade with acrylic surfacing and complete with chain link fence. per court
870,000 GOLF COURSES
Single court on grade with artificial turf surfacing and complete with chain link fence. per court
980,000
Extra for lighting.
300,000
per court
(Based on average cost of an 18-hole golf course) Excluding associated buildings and equipment. per hole
SWIMMING POOLS
Half Olympic (25m x 10.50m) outdoor swimming pool built into ground, fully tiled; complete with 5m wide deck and associated pool equipment and ozone system. per pool
per set
7,000,000 to 13,000,000
GOLF SIMULATOR
5,500,000
PLAYGROUND EQUIPMENT
Outdoor playground equipment comprising various activities.
130,000
250,000 to 650,000
Golf simulation system complete with projector, high impact projection screen, artificial turf, recording system and control computer with software (enclosing structure not included).
per set
550,000
2012 OUTLOOK China: Riding on the wave of recovery from 2010 and despite continued volatility in the global economy, the quarters of 2011, but was clouded by growing uncertainty in the property market towards the end of the year. The volume of construction works performed in 2011 grew at about 25% per annum, close to the rate in each of the preceding two years. However, the rate of growth for new-start floor areas in the real estate sector has slowed down slightly. This is likely because, on the one hand, the build-up of demand prior to the 2010 economic rebound has been released, whilst at the same time, the central government has taken decisive action to curb soaring residential property prices. The Government has adopted a series of measures to reduce speculative activities by property developers and end-users alike – including purchase limits, credit restrictions, a premium on the benchmark mortgage rate and higher down payments. Given the fact the Government has stated its long term goal is to keep property prices stable, these measures will likely be in place for some time. The credit crisis in the US coupled with the sovereign debt problems in the Eurozone has weakened the global economy, resulting in a slow-down of fixed asset investment activities across China. Given these conditions, private sector activity is likely to stablilise and we are unlikely to see another 2010-style boom anytime soon. A positive note is that the Government does not intend to cut the supply of residential property. In fact, it has committed to provide 36 million affordable public housing units in the coming five years. Of this, 10 million are to start each year in 2011 and 2012. When compared to the number of residential units started by the public and private sectors in 2010 (circa 5.8 million and 13 million respectively), this new initiative accounts for about half of the total floor area of all building works. On the face of it, this potential volume of new public works should be able to outweigh the possible slowdown in the private sector. However, the distribution of these 10 million units to various regions may not be in direct proportion to the scale of construction capacity in each region. For example, Chongqing’s construction output in 2010 was only 2.6% of the whole country, but their allocation of affordable public housing units for 2011 represents 5% of the country’s annual target (i.e. 500,000). On the other hand, Beijing and Shanghai performed 5.5% and 4.5% of the national total output in 2010, but are assigned only 200,000 and 260,000 units respectively. This apparent divergence may be partly explained by the fact that Beijing and Shanghai have relatively more commercial and infrastructure construction. However, it remains to be seen if this policy results in more localised variances in construction costs across the country. Within the industry, both material prices and labour wages continur to be influenced by inflation in living and and production costs. Both the Consumer Price Index and Producer Price Index had at one stage surged to 3-year highs, before dipping to 1-year and 2-year lows respectively in November, albeit still in positive territory. Workers’ pay rises are also bound by the nationwide increment in the Statutory Minimum Wage, which is about 20% on
average. However, this has been offset to some extent by material costs having dipped in the 4th quarter. As a whole, construction costs have risen about 5% in 2011. On the back of the Government’s proactive housing policy, the outlook for the industry remains fairly positive. Driven by increases in labour costs and general inflation, overall construction costs are forecast to rise by 5% p.a. in both 2012 and 2013. Hong Kong: Construction activity picked up in 2011, driven by implementation of the public infrastructure projects and a gradual recovery in the private residential sector following the 2008 crisis. With this improved sentiment, private residential have pressed ahead with new projects. Despite the HKSAR Government’s tightening measures (eg. extra stamp duty for properties sold within 2 years’ of purchase, increased down payments for units over HK$8M) and the banks’ increased mortgage rates, residential construction starts during the first nine months of 2011 still managed to reach 7,700 units. This surpassed the average 6,600 units which started each year from 2008 to 2010. These figures are likely to grow further over the next few years as a result of the Chief Executive’s commitment in the 2010/11 Policy Address to supply land for 20,000 private residential units a year, for the next decade. Plots of land released by the government for residential use in 2011 could potentially provide up to 12,000 private units. Of which, 6,700 will be built on top of, or adjacent to, existing MTR station boxes, where most of the foundation works have already been completed – thus allowing an early start on the superstructure construction. Given that the new-build private residential sector contributes about 20% of the annual gross output of the construction industry, it will not be long before this supply translates into increased construction volume. The likely follow-on effect will be pressure on tender prices. Basic construction costs have risen by around 8% in 2011, largely as a result of escalation in material prices and labour wages driven by the SAR’s 15-year-high inflation rate, the weakening of the US dollar against the Renminbi, and growing demand for labour. Overall, the outlook for the industry in 2012 is fairly upbeat, although continued uncertainty in the US and EU economies will need to be kept in view. We forecast construction costs will rise by 8% a year in both 2012 and 2013. Macau: Construction activity is expected to gather pace in 2012. One of the bigger projects is the long-awaited construction of the Macau Light Rail Transit (LRT) system, which is scheduled to last for about four years. In addition, the Macau government has been busy commissioning new public housing and other infrastructure works in response to growing economic activity and demand from the public. In the entertainment and gaming sector, a number of Cotai projects, such as Venetian Parcel 3, Macau Studio City, Wynn and the next phase of Galaxy Macau are scheduled to start in the latter part of 2012. Given the relatively modest levels of casino construction in the last two years, such increased demand is likely to put significant pressure on construction labour and material prices
for 2012 and beyond. Across the boundary with Guangdong, the progress of projects on the neighbouring Hengqin Island is expected to pick up in the next few years, especially from private sector investment. Given its proximity to Macau, it is likely that the work there will have an effect on Macau's construction prices. According to the Statistics and Census Service of the Macau Government, as at third quarter 2011, the average daily wages of construction workers was MOP569, representing a 4.6% year-onyear increase. Similarly, the price index of construction materials rose by 20.4% year-on-year. Given the above situation, we predict tender prices are set to increase by about 8% during 2012.
CONSTRUCTION COST TREND PREDICTION REGION
2011
2012
2013
China (1)
+5%
+5%
+5%
Hong Kong (1)
+8%
+8%
+8%
Hong Kong (2
+8%
+8%
+6%
Macau (1)
+7%
+8%
+8%
(1) Building Works (2) Civil Engineering Works
PROPERTY COMMENTARY HONG KONG'S PROPERTY MARKET IN 2011 Economic overview Hong Kong’s economic growth remained stable in 2011 although the global economy outlook remained unclear amid the outbreak of the European sovereign debt crisis. Hong Kong’s GDP growth in real terms surged 4.3% in the third quarter, following a gain of 5.1% in tthe first half of 2011. Visitor arrivals recorded a notable year on year growth of 16.2% in the first nine months of 2011, mainly driven by the growth in visitors from Mainland China. The value of retail sales also exhibited strong year-on-year growth of 25.4 % in the period. Meanwhile, the unemployment rate dropped to 3.3% in the three months to October, compared with 4.2% in the same period of 2010. Looking forward, the global economy is expected to become more recessionary in the coming year and the effect will inevitably spill over to Hong Kong. As employers may become cautious about hiring because of the unclear economic outlook, the unemployment rate in Hong Kong may rise slightly in 2012. The Hong Kong government has lowered the city’s GDP growth forecast for 2012 from 5–6% to 5%. Residential Hong Kong's residential market slowed in 2011 by a series of regulatory government policies, such as the implementation of Special Stamp Duty, and credit tightening measures adopted by local and Mainland banks. The number of residential sales transactionstotaled about 75,300 in the first ten months of the year down 33.5% from the same period in 2010. The luxury residential market was more resilient, with transactions worth HK$10 million or above dropping a less drastic 14.3% during the same period. Residential prices experienced minor downward adjustments in the third quarter, following an upward trend in the first half of the year. However, the average price of luxury homes by the end of September 2011 was still 62.4% higher than the level in November 2008, according to Rating and Valuation Department, when the market was dragged down to its trough by the global financial crisis. Mass residential prices performed even better and soared 75.7% in September 2011 compared with their trough in December 2008. In the leasing market, the average rent of luxury residential properties, by the end of September, had risen 42.2% from its trough in April 2009. Looking forward, uncertainties in the global economy are expected to keep the volume of residential sales transactions low in 2012. Mass home prices are likely to drop about 10-15% in 2012. Luxury residential properties should be more resilient due to their limited supply, with their prices set to adjust marginally by less than 10% in 2012.
Office The Grade-A office sales market continue to grow over the year, despite the introduction of lower loan-to-value ratios by the government. The average capital value of Grade-A offices rose 20.8% during the first ten months, compared with only 16.9% over 2010. The number of office sales transactions totaled 2,675 in the first nine months of 2011, up 4.3% from the same period of 2010, according to the Rating and Valuation Department. In the leasing market, financial institutions and professional services firms scrambled for limited office space in core areas. The average Grade-A vacancy rate edged down from 3.2% in December 2010 to 2.5% in October 2011. Aggressive corporate expansions and decreasing vacancies prompted landlords to raise their asking rents markedly, leading to a boost in office rents. By the end of November, the average rent of Grade-A offices witnesses a 21.3% year-to-date growth. Looking forward, office demand from financial institutions - that usually favour space in core districts - is likely to slow amid the eurozone debt crisis. Meanwhile, local firms are also expected to slow their expansion plans. Grade-A office rents in cire areas will see mild corrections, while rents in non-core districts will remain stable with the support of companies moving out from core areas to these locations to save operation costs. Retail Hong Kong’s retail property market experienced strong growth in 2011 on the back of robust retail sales and increased tourist arrivals, especially those from Mainland China. Amid relatively weak economies in US and Europe, international brands expanded aggressively in Hong Kong in order to grab a share of strong spending from Mainland tourists. Competition for leasing shops in prime locations was fierce, especially among international luxury fashion brands and jewellery shops, pushing up rents of prime street shops by 20.7% year on year in the first three quarter of 2011. In the sales sector, although retail property sales transactions dropped 8.5% year on year to 5,169 in the first nine mohts of 2011, their total value grew by 1.1%. In view of the cooling measures implemented on the residential sector, some investors turned to acquire quality retail properties for long term growth, pushing up prime street shop prices by 18.9% in the first three quarters of the year. In the coming year, with sustainable retail sales growth and the continued influx of Mainland tourists, we expect international retailers will continue to expand in Hong Kong, which would push up retail rents by another 10% over 2012.
Industrial Hong Kong’s industrial property market continued to recover over 2011, in the aftermath of the global financial tsunami. The government’s new policies to encourage the change of use of industrial buildings implemented in April 2010, plus the rezoning of industrial areas proposed in October 2010, helped revitalise the industrial sales market. There were 6,617 flatted-factory sales transactions during the first nine months of 2011, up 15.4% fromt he same period in 2010, with total consideration rising 45.1% to over HK$24.0 billion. The value of en-bloc industrial property sales reached about HK$4.6 billion up to mid-November 2011, up 7.2% from the same period of 2010, according to our research. During the first nine months of 2011, prices of flatted factories grew 23.1%, while their rents increased 11.4%, according to the Rating and Valuation Department. With prices rising faster than rents, yields slid to 3.9% in September 2011, compared with 4.6% a year ago. By the end of September, the Lands Department had approved 35 applications of change of usage under the revitalisation scheme, involving the demolition and redevelopment of nine industrial buildings as well as the wholesale conversion of 26 others, providing a total gross floor area of 380,000 sq m for non-industrial uses. We expect the acquisition of industrial buildings for redevelopment and conversion to continue in the coming year, which would further push up industrial property prices, while their rents would remain stable.
Provided by :
PROPERTY INDICATORS HONG KONG GRADE-A OFFICE PRICE
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE VACANCY RATES
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE RENTAL VALUES
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE SUPPLY
Source: Rating and Valuation Department / Knight Frank
GROSS FLOOR AREA (GFA) CALCULATIONS IN HONG KONG FEATURE
REMARKS
General floor area
Accountable
Basement
Accountable
Balcony / utility platform *
Accountable
Non-accountable if for residential buildings and be open on at least 2 sides, max. 50% area grantable.
Curtain wall / cladding
Non-accountable
Non- accountable if: 1. The curtain wall system itself does not form part of the structural system of the parent building; 2. The system does not result in any additional floor area at a floor level; 3. The projection of the system from the outer face of the structural elements does not exceed 300 mm.
External wall finishes (including bay windows) *
Non-accountable
Precast facades may subject to conditions be excluded from GFA calculation.
Plant rooms
Non-accountable
Subject to justification with reasonable plant layouts.
Staircases and lift shafts
Accountable
Covered public carparking space
Accountable
Covered private carparking space
Non-accountable
Area within outer surface of external walls.
Except staircases and lift shafts solely serving non-accountable areas. Applicable only for spaces serving users of the building required under local standard and built below ground.
Lobby *
Accountable
Concession may be granted for lift lobbies subject to conditions.
Canopy
Accountable
Non-accountable when the canopy soley serves as protection against weather and falling object.
Refuge floor
Non-accountable
Space below elevated ground floor
Accountable
Covered walkways *
Accountable
Loading and unloading bay
Non-accountable
Refuse storage chambers, refuse storage, refuse chutes, refuse hopper rooms
Non-accountable
Floor space inside sloping roof Covered area on roof-tops
*
BUILDING (PLANNING) REGULATION
Non-accountable if the covered areas are clearly intended for and designed as playground or dedicated as public passage. Open-sided covered walkways for common areas in residential developments may be exempted, subject to the proposed walkways being not for commercial use. Applicable if required under local standard/lease and built below ground.
Accountable Non-accountable
Non-accountable for plant rooms and staircases only.
Recreational facilities *
Accountable
Non-accountable subject to conditions.
Spaces for watchmen and management staff *
Accountable
Non-accountable subject to conditions.
External staircases
Accountable
Non-accountable if situated in non-accountable areas.
Total concessions of these areas are subject to a cap of 10% of the total GFA and prerequisites with sustainability designs.
Disclaimer : GFA calculations are subject to various legislation and practice notes. All cases of accountable or non-accountable GFA are subject to individual conditions. The above presents a brief summary only and users are advised to seek professional advice from authorized persons. Langdon & Seah herewith disclaims any liability that may arise from unsolicited use of the information given above.
GROSS FLOOR AREA (GFA) CALCULATIONS IN PRC FEATURE
NATIONAL STANDARD - STANDARD MEASUREMENT FOR CONSTRUCTION AREA OF BUILDING (GB/T 50353-2005)
General floor area
Accountable
Basement
Accountable
Balcony / utility platform
Accountable
Curtain wall / cladding
Accountable
External wall finishes (including bay windows)
REMARKS FOR BEIJING, SHANGHAI AND GUANGZHOU Area within outer surface of external insulation. Shanghai : External insulation is exempted from calculation of plot ratio. 1. Beijing: Non-accountable 2. Shanghai : Non-accountable. 3. Guangzhou : Accountable for GFA except where the floor space is solely for plant rooms or carpark Except decorative type of curtain wall.
Non-accountable
Plant rooms
Accountable
Staircases and lift shafts
Accountable
Covered public carparking space
Accountable
Covered private carparking space
Accountable
Lobby
Accountable
Canopy
Accountable
Refuge floor
Accountable
Space below elevated ground floor
Accountable
Covered walkways
Accountable
Loading and unloading bay
Accountable
Non-accountable if not roofed over.
Refuse storage chambers, refuse storage, refuse chutes, refuse hopper rooms
Accountable
Non-accountable if not roofed over.
Floor space inside sloping roof
Accountable
Non-accountable if clear height does not exceed 1.2m.
Covered area on roof-tops
Accountable
1. Shanghai : Non-accountable if the area of the construction on rooftop does not exceed 1/8 of the area of the typical floor. 2. Guangzhou: Staircase, lift lobby and water tank room on roof-tops are exempted from GFA
Recreational facilities
Accountable
Spaces for watchmen and management staff
Accountable
External staircases
Accountable
Non-accountable subject to width of the canopy not exceeding 2.1m. 1. Shanghai : Non-accountable. 2. Guangzhou : Only refuge areas on refuge floow are non-accountable. Non-accountable for GFA if for the usage of walkway, green, public amenities or similar public function.
Non-accountable if not roofed over.
Disclaimer : GFA calculations are subject to various legislation and practice notes. All cases of accountable or non-accountable GFA are subject to individual conditions. The above presents a brief summary only and users are advised to seek professional advice from authorized persons. Langdon & Seah herewith disclaims any liability that may arise from unsolicited use of the information given above.
COMPOSITE CPI
YEAR
INDEX
% CHANGE
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011*
90.2 95.9 101.5 104.3 100.2 96.5 94.9 92.0 89.7 89.3 90.1 92.0 93.8 97.8 98.4 100.7 105.5
9.2% 6.3% 5.8% 2.9% -3.9% -3.7% -1.6% -3.1% -2.6% -0.4% 1.0% 2.0% 2.0% 4.3% 0.5% 2.4% 5.2%
* 01/11 to 10/11 only Note: The base index (100) applies to the period from October 2009 to September 2010. Source
: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
EXCHANGE RATES Approximate rates prevailing on 30 November 2011. COUNTRY
CURRENCY
HK$1
US$1
Australia
Dollar
0.13
1.00
Brunei
Dollar
0.17
1.30
Canada
Dollar
0.13
1.03
Renminbi
0.82
6.39
EU (Euro Zone)
Euro
0.10
0.75
Hong Kong
Dollar
1.00
7.79
India
Rupee
6.70
52.18
Indonesia
Rupiah
1,177.26
9,170.00
Yen
10.01
77.93
Kazakhstan
Tenge
19.05
148.39
Macau
Pataca
1.03
7.99
Malaysia
Ringgit
0.41
3.19
New Zealand
Dollar
0.17
1.31
Pakistan
Rupee
11.23
87.47
Philippines
Peso
5.61
43.74
Qatar
Rial
0.47
3.64
Singapore
Dollar
0.17
1.30
South Korea
Won
146.63
1,142.14
Taiwan
NT Dollar
3.89
30.27
Thailand
Baht
4.02
31.32
United Kingdom
Pound
0.08
0.64
United States of America
Dollar
0.13
1.00
Vietnam
Dong
2,709.29
21,103.31
China
Japan
Source : www.exchange-rates.org Refer also : www.xe.com
CURRENCY CHARTS STERLING POUND
AUSTRALIAN DOLLAR
JAPANESE YEN
RENMINBI
Source
: Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information
Source
: Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information
Refer also
: www.xe.com ; www.exchange-rates.org
Refer also
: www.xe.com ; www.exchange-rates.org
HONG KONG PRIME RATE
CHANGES IN HONG KONG PRIME RATES DATE
14 Feb 2000 27 Mar 2000 22 May 2000 08 Jan 2001 05 Feb 2001 26 Mar 2001 23 Apr 2001 21 May 2001 03 Jul 2001 24 Aug 2001 19 Sep 2001 04 Oct 2001 08 Nov 2001 13 Dec 2001 08 Nov 2002 23 Sep 2004 12 Nov 2004 21 Mar 2005
%
8.75 9.00 9.50 9.00 8.50 8.00 7.50 7.00 6.75 6.50 6.00 5.50 5.25 5.125 5.00 5.125 5.00 5.25
DATE
%
23 May 2005 05 Jul 2005 22 Jul 2005 11 Aug 2005 23 Sep 2005 03 Nov 2005 15 Dec 2005 30 Mar 2006 07 Nov 2006 20 Sep 2007 02 Nov 2007 12 Nov 2007 13 Dec 2007 24 Jan 2008 01 Feb 2008 20 Mar 2008 10 Nov 2008
5.75 6.25 6.50 6.75 7.00 7.50 7.75 8.00 7.75 7.50 7.25 7.00 6.75 6.00 5.75 5.25 5.00
Source : Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information.
HANG SENG INDEX
Refer to www.aastocks.com for further information.
TELEPHONE DIRECTORY HONG KONG GOVERNMENT Architectural Services Department Headquarters Administration Division 2867 3628 Architectural Branch Advisory & Statutory Compliance Division 2867 3759 Architectural Drawing Records Unit 2867 3691 Division 1 2867 3935 Division 2 2867 3814 Site Staff (New Works) 2867 3992 Technical Officer (Architectural) Grade Management Unit 2867 3691 Building Services Branch Division 1 2867 3538 Division 2 2867 3493 Division 3 2867 3629 Division 4 2867 4156 Property Services Branch 2773 2217 Quantity Surveying Branch 2867 3298/2867 4597 Structural Engineering Branch 2867 3791 Buildings Department 2626 1616 Census and Statistics Department 2582 4807 Civil Engineering and Development Department 2762 5111 Customs and Excise Department 2815 7711 Drainage Services Department 2877 0660 Electrical and Mechanical Services Department 1823 Environmental Protection Department 2594 6308 Fire Services Department 2311 0066 Government Laboratory 2762 3700 Government Property Agency 2594 7604 Highways Department 2926 4111 Housing Department 2712 2712 Labour Department 2717 1771 Lands Department 2231 3294 Planning Department 2231 5000 Rating and Valuation Department 2152 0111 Water Supplies Department 2824 5000 Refer to http://tel.directory.gov.hk for further information.
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, Malaysia, Philippines, Vietnam and Singapore and is also the editor of the Spon’s Price Book Series. As in the previous editions, the DLS Handbook – India 2012 focuses on the construction cost profile of India and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in India. The information contained in this handbook has been compiled by Davis Langdon & Seah Consulting India Pvt Ltd. Any further information and/or if advice relating to particular projects is required, please contact us at the address given at the end of this handbook.
INDIAN CONSTRUCTION - AN OVERVIEW Construction in India has historical significance and finds remarkable place in Indian history. World wonders such as the Taj Mahal and ancient temples are classic examples of construction achievements in ancient times. During the period of British rule and post Independence India, the construction industry was dominated by the government and this domination continued up to the mid 1990s. The subsequent change in foreign investment policies accelerated industrialization, foreign investment and subsequent demand for buildings and infrastructure. Indian Construction Industry today is the second largest economic activity in the country, followed by agriculture. Construction with linkage to other industries hasgenerated employment for more than 40 million people in the country. The cost structure of the construction industry is principally dominated by raw material costs and sub-contracting costs. Raw material cost which is the major cost component, accounts approximately 30% to 50% of the total cost and subcontracting cost accounts approximately 20% to 40%. The consumption of steeland cement by the construction industry has also shown an increase of 16% and 10% respectively between 2002 and 2007. Prior to the global economic crisis, India has experienced an unprecedented rise in the price of these two raw materials resulting in a significant increase in the construction cost trend. However, prices of these two materials have reduced considerably in 2009 by up to 20% and 25% respectively, resulting in a downward trend in construction cost. Prices of these two materials started to increase in early 2010 and current material price remains volatile. The Construction Industry is dependent on investments in the infrastructure, industrial and real estate sectors. The Planning Commission has envisaged an outlay of approximately US$ 300 billion during the 11th Five Year Plan for infrastructure development in the country. These investments would be achieved through a combination of Public and Public-Private Partnerships. 11th Five Year Plan (2007-2012). The estimate of additional investment for the 11th Five Year Plan period is given below. ITEM
AMOUNT RS CRORES
Private Investments in Road
34,000
Expressway Development (Modernization/Upgradation)
220,000
Railways (Public)
180,000
Railways (Private)
120,000
Civil Aviation
40,000
Ports (Private)
50,000
Freight Corridors for Railways Power Generation Housing
22,000 420,000 150,000
INFRASTRUCTURE DEVELOPMENT 1. Roads India has 3.3 million kilometers of road out of which 70,000 kilometers comprises national highways. The road network carries approximately 85% of the total passenger traffic and 70% total freight traffic. The National Highway Authority of India (NHAI) is currently implementing an US$ 12 billion national highway development projects. Some of the major developments planned by NHAI are: • Six-laning of the Golden Quadrilateral - 5,846 kms connecting Delhi-Kolkata-Chennai-Mumbai and; • Four-laning North-South and East-West Corridors 7,300 kms connecting Kashmir to Kanyakumari including Salem to Cochin Spur and Silchar to Porbandar; spanning the length and breadth of the country. 2. Railways The Indian Railway system is the World’s fourth largest rails network and the largest in Asia. It comprises of over 100,000 track kilometers and runs about 11,000 trains everyday carrying an estimated 18 million passengers and 2 million tonnes of freights. A large proportion of the capital investment is proposed to be raised through Public-Private Partnerships. Indian Railways is expected to invest US$ 45.9 billion in the 11th Five Year Plan, triple the amount envisaged in the 10th Plan. 3. Ports Considerable private investment has started flowing into the Indian port sector. A number of existing facilities have been taken over by private players and many new facilities have also been set up at existing ports. Two new ports (Mundra and Pipavav in Gujarat) have also been constructed by the private sector. India currently has 12 major ports and 200 minor/intermediate ports spread across the vast coastline of 7,517 kms. They handle almost 90% of India’s total foreign trade. The current handling capacity of the ports in the country is around 600 million tonnes. This has been achieved through construction of a new port at Ennore and a mechanized coal handling facility at Paradip. Thesetwo facilities entailed an investment of around US$ 394 million. According to government estimates, private sectorinvestment in ports may exceed US$ 18 billion within a decade. The Government of India targets to increase cargo handling capacity of major ports by two folds to reach 1.5 billion metric tonnes (MT) by the year 2012.
BASIC COST OF KEY MATERIALS UNIT
RATE* [Rs]
Reinforcement Steel
MT
42,000
Ordinary Portland Cement
Bag
285
20mm Aggregate
m3
850
Sand
m3
1,200
Shuttering Plywood
m2
625
200mm Solid Concrete Block (400mm x 200mm x 200mm)
No
36
100mm Solid Concrete Block (400mm x 200mm x 100mm)
No
25
200mm Hollow Concrete Block (400mm x 200mm x 200mm)
No
35
100mm Hollow Concrete Block (400mm x 200mm x 100mm)
No
25
Teak Wood
m3
110,000
Sal Wood
m3
33,000
Vitrified Tiles
m2
500
Ceramic Tiles
m2
400
Emulsion Paint
Ltr
200
MATERIAL
* Material rates are nett of VAT
The prices of cement and reinforcement steel are highly volatile and fluctuate very frequently. The charts below provide the price variation of these two materials for the last six months:
Cement Price Fluctuation Rs. / 50kg bag
Description
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
275
285
280
280
275
295
Cement (Grade 53)
Cement Price Fluctuation 300
Rs. / 50kg bag
295 290 285
Cement (Grade 53)
280 275 270 Jun-11
Jul-11
Aug-11 Sep-11
Oct-11
Nov-11
Months
Reinforcement Price Fluctuation Rs. / MT
Description Reinforcement Steel
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
41,500
41,350
44,385
41,600
42,689
41,500
Reinforcement Steel Price Fluctuation 45,000 44,500
Rs. / MT
44,000 43,500 43,000
Reinforcement Steel
42,500 42,000 41,500 41,000 40,500 Jun-11
Jul-11
Aug-11 Sep-11 Months
Oct-11
Nov-11
WAGES OF KEY PERSONNEL PERSONNEL
RATE/DAY [Rs]
Skilled Mason
400
Semi-Skilled Mason
300
Tiling Mason
450
Bar Bender
375
Carpenter
425
Painter
400
Welder
400
Electrician
400
Plumber
400
Unskilled Labour
250
4. Airports India has 126 airports: of these 12 are designated as international airports. The top 5 airports in the countryhandle 70% of the passenger traffic. The Government has embarked on a number ofupgrading and new airport development projects which have been made available for FDI. Key factors driving airport development are listed below: • Passenger traffic is projected to grow at a Compound Annual Growth Rate (CAGR) of over 15% in the next 5 years. Expecting 100 million passengers per annum (p.a) over the next 5 years • Cargo traffic to grow at approximately 20% p.a. over the next five years • Favourable demographics and rapid economic growth point to a continued boom in domestic passenger traffic and international outbound traffic • Indian private airline accounts for around 60% of the domestic passenger traffic • Estimated investment of about Rs.40,000 Crores (US$ 9 billion) for airport development over the next 5 years • 100% FDI is permissible in existing airports; FDI beyond 74% requires FIPB approval • 100% tax exemption for airport projects for a period of 10 years 5. Power India presently has a huge shortfall in power generating requirements to support the economic and population growth. Some key features are as follows: • Transmission and Distribution Network of 5.7 million circuit km – the 3rd largest in the world • 57% of the installed generation capacity comes from coal-fired plants, followed by 25% from hydro power, 10% gas-based, 3% from nuclear energy and 5% from renewable sources • 100% FDI is permitted in Generation, Transmission and Distribution • Total investment opportunity of about US$ 200 billion over a seven year horizon
Investment in Different Sectors Scope of Investment Required in Different Sectors (5 to 7 Years) 80 70
50 40 30 20 10 0 R o R ad ai lw ay s Ai rp or t Po rt Po w W er at er In fr Te a. le Fo od com Pr oc es s
US$ Billion
60
Sectors
US$ Billion
PROCUREMENT MODEL AND CONTRACT FORMS In both public and private sectors, most of the construction projects are procured based on competitive tendering. The following are the commonly adopted procurement routes in India: 1. Conventional Contract based on Bills of Quantities/ Sum 2. Design and Build Contract 3. Construction Management Contract 4. Management Contract Commonly used contract forms are: • FIDIC suite of Contracts (EPC/Turnkey/Short Form) • Indian Institute of Architects Forms • Central Public Works Department Forms • Municipal Bodies Forms
Lump
CHALLENGES FACING REAL ESTATE AND CONSTRUCTION INDUSTRIES • Land Ownership and Title Issues • High Transaction Cost • Slow Approval Process • Liquidity Risk • Property Market Transparency Risk • Supply and Demand on Material and Labour • Shortage of Technical Supervisory/Skilled Labour
PREAMBLES The construction costs for the respective categories given on the following pages are average costing at 4th Quarter 2011. They are based on interpolation of competitive tenders received. The construction cost serves as a guide for preliminary cost appraisals and budgeting. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metres are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, plant rooms, water tanks and the like. All buildings are assumed to have no basements (unless otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs exclude the following: • Professional fees • Authorities’ processing and approval charges • Land cost • Financing charges • Administrative expenses • Legal costs and disbursements • Demolition of existing building/s • Loose furniture and fittings • Operating equipment • Cost escalation • Value Added Tax (VAT) and Service Tax
CONSTRUCTION COSTS FOR INDIA TYPES
COST Rs/m 2
US$/m 2
RESIDENTIAL Detached houses and bungalows
20,441
409
Terraced houses
15,007
300
Avg. std. apartments, high rise
17,336
347
Luxury apartments,
21,955
439
OFFICE/COMMERCIAL Avg. std. offices, high rise
20,295
406
Prestige offices, high rise
25,704
514
Shopping centres
23,512
470
INDUSTRIAL Light duty flatted factory factories
13,183
263
Heavy duty flatted factories and warehouses Single storey conventional factories
15,667
313
12,622
252
Owner operated factories, low rise
15,840
317
36,180
723
3-star budget hotels inclusive of F.F. & E.
40,888
817
5-star hotels inclusive of F.F. & E.
79,600
1,588
OTHERS Basement car parks (<3 levels)
12,712
254
Elevated car parks (<4 levels)
11,080
222
Primary and secondary schools
8,907
178
Student hostels
11,385
228
Sports clubs inclusive of F.F. & E.
30,255
605
HOTEL Resort hotels
The foregoing construction costs are based on Bangalore. Exchange Rate US$1 = Rs.50/-
M&E COSTS FOR INDIA ACMV Rs/m2
ELECTRICAL Rs/m2
1,140
1,460
900
1,100
1,200
1,450
Avg. std. offices, high rise
3,700
4,000
Prestige offices, high rise
4,050
4,475
Flatted factories
2,540
2,675
Warehouses
2,800
3,050
Resort hotels
2,310
2,520
3-Star budget hotels
4,050
4,400
5-Star luxury hotels
4,650
4,850
-
475
520
500
3,250
3,850
TYPES
RESIDENTIAL Detached houses Avg. std. apartments, high rise Luxury apartments, high rise OFFICE
INDUSTRIAL
HOTELS
OTHERS Elevated car parks Basement car parks Shopping centres
OFFICE M&E COST COMPONENTS Electrical 5%
4%
ACMV 20%
8%
4% 1%
8%
3%
1%
35%
10%
9%
13%
1%
12%
1%
10% 1%
11%
1%
12%
15%
LV mains & sub-mains distribution system Lightning protection system Luminaries Earthing system Final sub-circuit for lighting & power points External lighting Standby generator Telephone distribution system Sub-station, HV & LV switchgear MATV/SCV system Underfloor trunking system CCTV/Guard patrol system Power transformer Public address system Intercom/Card access system
Chilled water AHU/FCU and ductworks Electrical and automatic control works Chiller plant Mechanical ventilation fan system and ductworks Condenser water pumps and pipeworks Chilled water pumps and pipeworks Cooling towers Split units and ductworks
Fire Protection 3%
15%
Plumbing and Sanitary
3%
7%
11% 2%
13% 19% 42%
7%
27% 22% 10%
Sprinkler Hose reel Wet riser Dry riser Automatic fire alarm Fire extinguisher External fire hydrant
28%
6%
Water works Water pumps Cold water distribution piping Installation and connection of water piping to sanitary wares Aboveground drainage piping system Underground drainage piping system Installation and connection of waste water piping to sanitary wares
REAL ESTATE DEVELOPMENT The real estate development in India has grown considerably since 2003 and peaked in 2007. The sector development slowed down in 2008 as a result of the global economic turmoil and showed a drastic slowdown in the first half of 2009. Faced with reduction in demand, housing prices dropped drastically. The early 2010 showed a comeback in the property sector and the outlook for the sector currently looks promising; however the uncertainties in the global economy may affect the FDI investments in the real estate sector. Residential space constitutes of almost about 80% of the real estate developed in India. The IT/ITES sector and the organized retail industry would require an estimated space of 150 million sq ft and 200 million sq ft respectively pan-India in the next 3 years. Hospitality sector also shows similar increase in requirements. The key demand drivers in the various real estate segments are: • India’s emergence as an attractive off-shoring destination for software development • Availability of highly skilled manpower • High disposable income and increasing aspirations for quality residential space • Entry of global brands and professional players • Improvement in infrastructure • Real estate as an investment option • Relaxed government and legal processes
KEY DATA India is one of the oldest civilizations with a kaleidoscopic variety and rich cultural heritage. It has achievedmultifaceted socioeconomic progress since gaining independence in 1947. Covering a landmass of 3,287,590 Square Kilometers extending from theHimalayan heights to the tropical rain forests of the south. As the seventh largest and second most populous country in the world, India stands apart from the rest of Asia. Bordering with Afghanistan and Pakistan to the northwest, China, Bhutan and Nepal to the north, Myanmar to the east and Bangladesh to the east of West Bengal and Sri Lanka to the south, India is strategically located. India is a Sovereign Socialist Democratic Republic witha federal parliamentary system of government. TheConstitutional head of State is the President and head of Government is the Prime Minister. The federal republic is governed in accordance with the Constitution of India which came into force on 26th January 1950. The Federal Republic consists of twenty-eight states and seven union territories. The parliament is a bicamental legislature: the lower house, the Lok Sabha, has 545 members, 543 singlemember constituencies and 2 representatives of Anglo-Indians appointed by the President; and the upper house, the Rajya Sabha, is elected by the provincial legislatures. Government Country Name
: Republic of India
Head of State
: President
Government Type
: Federal Republic
Head of Government
: Prime Minister
Capital City
: New Delhi
Administrative Divisions : 28 States and 7 Union Territories Independence
: 15th August 1947
Legal System
: Based on Constitution of India
Official Language
: English/Hindi
National Language
: Hindi
Geography Geographic Coordinates : 2000N, 7700E Location
: Southern Asia
Total Area
: 32,87,590 SqKm
Land Area
: 29,73,190 SqKm
Water
: 3,14,400 SqKm
Land Use
: Arable land 48.83% Permanent crops 2.8% Others 48.37%
Irrigated Land
: 5,58,080 SqKm
Coastline
: 7,500 Km
Natural Resources
: Coal (world 4th largest), iron ore, manganese, mica, bauxite, titanium chromate, natural gas, diamonds, petroleum, limestone
Climate Type
: Tropical monsoon with four seasons; winter, summer, rainy south-western monsoon and north-east monsoon
People Total Population
: 1,210 million
Age Structure
: 0 - 14 years 32.3% 15 - 59 years 60.5% 60 & above 7.2%
Population Growth Rate : 1.548% Median Age
: Total 26.2 years Male 25.6 years Female 26.9 years
Life Expectancy
: Total 68.8 years Male 65.77 years Female 67.95 years
Urban Population Delhi
: 16.33 million
Mumbai
: 18.41 million
Kolkata
: 14.11 million
Chennai
: 8.69 million
Bangalore
: 8.49 million
Ethnic Group
: Hindus 80.5% Muslims 13.4% Christians 2.3% Sikhs 1.8% Buddhists 0.8% Jains 0.4% Others 0.7% and Unspecified 0.1%
Languages
: Hindi 41% Bengali 8.1% Telugu 7.2% Marathi 7% Tamil 5.9% Urdu 5% Gujarati 4.5% Others 21.3%
Literacy (Definition-
: Total population 64%
Age 15 and over
Male 75.3%
can read and write)
Female 53.7%
Population below poverty line
: 21%
Labour Force : Labour Force by Occupation
523.5 million : Agriculture 60% Industry 12% Services 28%
Unemployment Rate
: 6.8%
Economy Monetary Unit
: Indian Rupees (Rs)
Currency Code
: INR
Exchange Rate to British Pound
: 80.10 INR
USD
: 49.78 INR
Euro
: 68.82 INR
Inflation Rate
: 9.73%
Fiscal Year : 1 April – 31 March GDP (Purchasing Power : $ 4.057 trillion Parity) (2011 Est) GDP (Official Exchange : $ 1.54 trillion Rate) GDP Real Growth Rate
: 7.6%
GDP per Capita GDP Composition by Sector
: $ 3,580 : Agriculture 18.5% Industry 26.3% Services 60.5%
Trade Total Exports
: $ 251.1 billion
Major Export
: Engineering Goods, Textile goods,
Commodities
Chemicals, Gems & Jewellery,
Export Partners
Leather manufactures : US 10.17%, UAE 13.76%, China 7.81%
Total Imports Major Import Commodities
: $ 369.7 billion : Crude Oil, Chemicals, Fertilizer and Gems
Import Partners
: China 11.75%, US 5.42% UAE 8.85%, Singapore 1.93%
International Airports
: Delhi, Mumbai, Kolkata, Chennai, Bangalore, Trivandrum, Cochin, Hyderabad, Ahemadabad
Major Seaports
: Mumbai, Cochin, Vishakhapatnam, Chennai, Tuticorn, New Mangalore, Kandla
ECONOMY The Indian economy has been growing at an impressive rate of 6% per year which accelerated to around 8% during the last couple of years. The growth recorded at 7.6% in 3rd Quarter 2011 which was moderately lowerthan the 8% anticipated by the Government of India. Rising inflation has resulted in a lower growth rate for year 2010-2011 as compared to the 8.8% growth rate in the previous year. GDP at Factor Cost 1,600,000
1,400,000
1,200,000 Mining & Quarrying
GDP (Factor Cost)
1,000,000
Manufacturing Electricity, Gas & Water Supply
800,000
Construction Trade, Hotel, Transport & Communication
600,000
Financing, Insurance, Real Estate & Business Services
400,000
Community, Social & Personal Services Agriculture
200,000
0 2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
Years
Source: Reserve Bank of India
Following the liberalization policy in 1990, the Government of India opened up the market through economic reforms and by easing government controls on foreign trade and investment. The Indian economy is characterized by a large young workforce which makes it dynamic and expansive. It is very diverse, with a wide range of sectors: manufacturing, handicrafts, textiles and services sectors. Theadvancement of information technology and the abundance of young well educated populace versed in English, is transforming India into an importantdestination for all major international companies for software development and technical support services. India is a major exporter of highly-skilled software professional. India is also expected to make considerable progress in other areas such as pharmaceuticals, manufacturing, tourism, aviation, telecommunications and biotechnology. Challenges for Indian Economy • Controlling inflation • Equitable spreading of growth benefits • Completing investment projects which are essential for the long term development of the economy • Managing global financial
FOREIGN INVESTMENT POLICY The following are some of the highlights of the Foreign Direct Investment (FDI) Policy in the real estate sector: • 100% FDI is allowed in real estate developments of over 50,000 m2 • Capital must be brought into India within 6 months of incorporation of JV or subsidiary • Repatriation of original investment allowed after 3 years • Sale of undeveloped land is not permitted • Minimum area to be developed has been reduced from 100 to 25 acres for integrated township projects • Minimum capital investment of wholly owned subsidiaries and joint ventures stands at US$ 10 million and US$ 5 million respectively • 51% FDI is allowed in single brand retail outlets and cash-and-carry through automatic route
100% in
FDI Infrastructure Equity Limit: Real Estate (Townships) Roads Power Airports Mining Telecom Airlines Banks (Private) Insurance
100% 100% 100% 74% 74% 74% 74% 74% 26%
Special Economic Zones (SEZs) SEZs are specially delineated duty free enclaves for the purpose of trade, operations, duty and tariffs. A SEZ may be set-up in the public, private, or joint sector and/or by a state government. There are about 98 functional SEZs in the country including those converted from the Export Processing Zones. SEZs have been developed in various segments such as multi-product, IT/ITES, biotechnology, gems and jewellery and technology intensive areas. The policy allows 100% FDI in most manufacturing activities. Developments in SEZ qualify for approval through automatic routes subject to sectorial norms. Details of the type of activities permitted are available in the Foreign Trade Policy issued by the Department of Commerce. Proposals not covered under the automatic route require approval by the Foreign Investment Promotion Board (FIPB).
Facilities to SEZ Units • SEZ units may import or procure from the domestic sources, duty free, all their requirements of capital goods, raw materials, consumables, office equipment, etc., for setting up of units or further operations without any license or specific approval • Goods imported/procured locally duty free could be utilized over the approval period of five years • 100% income tax exemption for the first five years and 50% for the two years thereafter • 100% FDI is allowed in the manufacturing sector in SEZ units under the automatic route except sectors requiring an industrial license. 100% FDI is allowed in items reserved for small scale units • Setting up of offshore banking units is allowed in SEZs. They would be entitled for 100% income tax exemption for three years and 50% for the next two years • More flexible exchange control regulations for units in SEZs and for external commercial borrowing up to US$ 500 million in a year • Exemption from service tax to SEZ units
Breakdown of SEZ by Sector 22%
4%
3%
62%
4% 5% IT/ITES
Biotech
Pharma
Textile
Multiproduct
Others
Generally the developments permitted under 100% FDI are: 1. Export Oriented Units (EOU) 2. Industrial Parks 3. Electronic Hardware Technology Parks 4. Software Technology Parks Units
EXCHANGE RATES Approximate current rates at 11th November 2011 COUNTRY
PER UNIT
INR
Australia
Dollar
52.47
China
RMB
7.70
Eur
68.82
Dollar
6.30
Japan
Yen
0.64
Korea
Won
0.04
Ringgit
15.81
Peso
1.01
NT Dollar
1.14
Baht
1.60
UK
Pound
80.10
USA
Dollar
49.78
Europe Hong Kong
Malaysia Philippines Taiwan Thailand
RELEVANT WEBSITES Government of India Government of India Directory Ministry of Finance Ministry of Commerce & Industry Ministry of Statistics and Programme Implementation Ministry of Law & Justice Ministry of Labour Ministry of Home Affairs (MHA) Ministry of External Affairs Ministry of Urban Development Office of the Economic Advisor Central Public Works Department Supreme Court of India
http://goidirectory.nic.in/ http://finmin.nic.in http://dipp.nic.in http://mospi.gov.in http://lawmin.nic.in http://labour.nic.in http://mha.nic.in http://meaindia.nic.in http://urbanindia.nic.in http://eaindustry.nic.in http://www.cpwd.gov.in http://supremecourtofindia.nic.in
Government Bodies Reserve Bank of India Bureau of Indian Standards Insurance Regulatory and Development Authority
http://rbi.org.in http://bis.org.in http://irdaindia.org
Construction Related Organisations The Institution of Engineers The Indian Institution of Valuers The Indian Institute of Architects Construction Industry Development Council
http://ieindia.org http://iivindia.org http://iia-india.org http://cidc.in
Others National Stock Exchange of India Ltd. Bombay Stock Exchange Limited Davis Langdon & Seah Asia
http://nseindia.com http://bseindia.com http://www.dlsqs.com
About Us Davis Langdon & Seah (Malaysia) Sdn Bhd, which was first set up as Langdon & Every (Far East) in Kuala Lumpur in 1947 is amongst the longest established Quantity Surveying firm in Malaysia and pride ourselves with having the most complete set of database on the major projects that have been implemented in the country since Independence. Davis Langdon & Seah (Malaysia) Sdn Bhd practises in conjunction with our local sister practices of Juru Ukur Bahan Malaysia (JUBM) and JUBM Sdn Bhd. Jointly, we have accumulated a wealth of information and knowledge of local construction practice, customs, costs and useful data from the numerous projects that have been entrusted to us. Juru Ukur Bahan Malaysia was established in 1972 and is one of the earliest fully Malaysian Quantity Surveying practices to be set up in Malaysia. Today, the DLS-JUBM Group is one of the largest Quantity Surveying and Construction Cost Consultancy practices in Malaysia with some 250 staff throughout Malaysia working from five main offices situated at Kuala Lumpur, Penang, Johor Bahru, Kota Kinabalu and Kuching. The DLS-JUBM Group had successfully participated as Quantity Surveyors and Cost Managers providing capital budgeting, cost management, cost control, financial, contractual advisory and other related services in the full spectrum of development works in Malaysia for both Government and the Private Sector. Our experience covers participation in project evaluation, value management and feasibility/market studies as well as in the physical implementation of capital projects. We have also developed our competencies in undertaking project management, legal support and management consultancy services. Davis Langdon & Seah (Malaysia) Sdn Bhd is a member of Davis Langdon & Seah which constitutes a regional partnership of Quantity Surveyors and Construction Cost Consultants offering clients the services of more than 2,800 staff based in 40 offices in 13 countries. Global Reach .... Local Delivery
Davis Langdon & Seah (Malaysia) Sdn Bhd (520443-H) Juru Ukur Bahan Malaysia JUBM Sdn Bhd (27638-X) Quantity Surveyors & Construction Cost Consultants
Quality Management System It is a policy of the Davis Langdon & Seah (Malaysia) Sdn Bhd together with its associated local companies, namely Juru Ukur Bahan Malaysia and JUBM Sdn Bhd (“The Company”) to ensure that the quality of the services provided are consistently of a high professional level and shall be no less than the scope of work and brief agreed with the client. Through the implementation and constant improvement of the “Quality Management System”, the Company aims to achieve our vision of becoming the first point of reference for clients. This quality policy is supported by the Company’s commitment in continuing education and training of its staffs, as well as applying the latest technology which are pertinent to their works. Together with our member firms in other regions around the world, we aim to have global reach whilst at each locality we have hands-on experience to deliver our services. The Company achieved the accreditation to ISO 9001 by the Standard & Industrial Research Institute of Malaysia (SIRIM) since May 1995 and we are also the first Quantity Surveying Consultancy firm in Malaysia to have successfully obtained such certification. We have since upgraded our quality management system to the new MS ISO 9001:2008 standards. We believe the application and implementation of the Company’s Quality Management System provides us with significant opportunities for: Improved service performance and client satisfaction; Improved productivity and efficiency; Increased competitive advantage through improved organisational capabilities; and Instilling confidence of clients and other interested parties in the Company.
MALAYSIA
D IT ED C
BO
DY
AC
CRE
N ERTIFICATIO
MS ISO/IEC GUIDE 62:1999 QS 02121999 CB 01
Certified to ISO 9001 : 2008 Cert. No. : AR0595 / AR0598 / AR0599
Environmental Health & Safety Davis Langdon & Seah (Malaysia) Sdn Bhd is committed in addressing the delicate balance between maintaining profitability and reducing environmental impact insofar as possible in the company’s daily practise, processes and business activities. To this end, we - together with our associate local company JUBM Sdn Bhd - have put in place an Environmental Management System (EMS) that identifies all aspects of the business which impacts on the environment as well as the relevant environmental laws in the industry. From the EMS is then derived the company’s Environmental Health and Safety (EHS) Policy Statement which lists the quantifiable objectives under the EMS for the company and its staff as well as the management programme to achieve them on a continuous basis. The company’s EMS adopts the best available techniques that are appropriate, economical and cost effective in achieving these objectives in terms of measurability and practicability. Our efforts in incorporating the EMS and the EHS Policy into the practice, processes and business activities were given due recognition on 27 February 2009 when Davis Langdon & Seah (Malaysia) Sdn Bhd and JUBM Sdn Bhd received the globally recognised MS ISO 14001 accreditation in another industry landmark achievement for the group.
Construction Cost Specification The costs for the respective categories given on the following pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter, and are inclusive of lift shafts, stairwells, plant rooms, water tanks and the like. The costs per square metre excludes local infrastructure cost. All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs excludes land cost, professional fees, finance costs and legal expenses. The standards for each category of building vary from country to country and do not necessary follow those of Malaysia.
INDUSTRIAL Flatted factories exclude manufacturing equipment, airconditioning and electrical distribution system to tenants areas. Owner operated factories exclude manufacturing equipment, airconditioning and special services provisions.
HOTELS F.F.&E. includes interior decoration and loose furniture etc. but excludes operator’s items (e.g. cutlery, crockery, linen etc.).
OTHERS Carparks to be multi-storey, above ground. Schools with standard government provisions. Student hostels to university standard.
DOMESTIC Average standard apartments of 6-10 units per floor, 46m2 - 83m2 per unit. Air conditioning allowed for luxury apartments and prestige houses. Prestige houses include provision of functional light fittings only. Interior fit-out and decoration is excluded. No light fittings have been allowed for other types of domestic construction.
OFFICE / COMMERCIAL Based on buildings 20-30 storeys high with floor plans minimum 1,000m2 per level. Average standard offices and shopping centres exclude A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations, granite finishes lobbies with A/C ducting and light fittings to tenants area.
KUALA LUMPUR CONSTRUCTION COST TREND 2001 - 2011 Domestic
Industrial RM/m2
RM/m2 3,000
1,800 1,600
2,500
1,400
2,000
1,200
1,500
1,000
1,000
600
800 400
500
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Bungalows (mass housing) Terraced houses Average standard apts, high rise Low cost flats, low rise (<6 levels)
0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Detached houses and bungalows* Luxury apts, high rise Low cost flats, high rise (<15 levels) Low cost housing
Office / Commercial RM/m2
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise
Hotels
RM/m2
3,500
8,000
3,000
7,000 6,000
2,500
5,000
2,000
4,000 3,000
1,500
2,000
1,000
1,000 0
500
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Average standard offices, high rise Prestige offices, high rise* Shopping Centres
* Cost are at lower range cost All cost are at an average level unless otherwise stated
Resort Hotel inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto*
FIT-OUT COSTS FOR KUALA LUMPUR DESCRIPTION
RM/m2
HOTELS Public Area (Front of House): 3 - star Hotel 2,200 - 2,990 4 - star Hotel 2,900 - 3,600 5 - star Hotel 3,600 - above Guest Rooms: 3 - star Hotel 1,100 - 1,550 4 - star Hotel 1,500 - 2,370 5 - star Hotel 2,300 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, chandelier, building shell, operational items and equipment (e.g. bed, cutlery crockery, linen, television, refrigerator etc.), opening expenses, stage equipment and computer systems. OFFICES General Office 430 570 Executive Office 570 930 Prestige Office 930 - above Notes: 1. Local furniture allowed for general offices. 2. Includes furniture, partitioning, minor alteration to airconditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, Local Area Network, office equipment (e.g. computers, photocopies, fax machines, UPS, etc). RESTAURANTS General dining restaurant 1,800 - 3,300 Fine dining restaurant 5,000 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.).
DLS - JUBM BUILDING WORKS COMPOSITE TENDER PRICE INDEX (BWCTPI) Tender Price Index
190.0
180.1
180.0 170.0 160.0
152.3
150.0 137.2
140.0 130.0
100.0
111.3 97.8
90.0
101.2
93.6 90.6 91.7 98.1 100.0 97.8 96.6
153.8 146.3 142.1 143.2 141.0 149.9 146.0 141.6 141.3
147.2 137.3
145.7
135.7
122.8
120.0 110.0
161.3
133.4
118.0
92.2
80.0 70.0
74.2
60.0 50.0
Base Year = 2000
Source: JUBM & DLS
Projection 1H 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2010
Q4 2009
Q3 2009
Q2 2009
Q1 2009
Q4 2008
Q3 2008
Q2 2008
Q1 2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1983
1982
40.0
LS - JUBM BUILDING WORKS COMPOSITE TENDER PRICE INDEX (BWCTPI) Tender Price Index
190.0
180.1
180.0 170.0 160.0
152.3
150.0 137.2
140.0 130.0
100.0
111.3 97.8
90.0
101.2
93.6 90.6 91.7 98.1 100.0 97.8 96.6
153.8 146.3 142.1 143.2 141.0 149.9 146.0 141.6 141.3
147.2 137.3
145.7
135.7
122.8
120.0 110.0
161.3
133.4
118.0
92.2
80.0 70.0
74.2
60.0 50.0
Base Year = 2000
Source: JUBM & LS
Projection 1H 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2010
Q4 2009
Q3 2009
Q2 2009
Q1 2009
Q4 2008
Q3 2008
Q2 2008
Q1 2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1983
1982
40.0
Green Building A Green Building focuses on increasing the efficiency of resource use while reducing building impact on human health and the environment during the building’s lifecycle, through better sitting, design, construction, operation, maintenance, and removal.
Green Building Index The launching of the Green Building Index (GBI) in May 2009 was an important milestone in the push for a more sustainable construction industry in Malaysia. Co-developed by Pertubuhan Akitek Malaysia (PAM) and Association of Consulting Engineers Malaysia (ACEM), the GBI is a voluntary rating tool based on six criteria: Energy Efficiency (EE) Improve energy consumption by optimising building orientation, minimizing solar heat gain through the building envelope, harvesting natural lighting, adopting the best practices in building services including use of renewable energy, and ensuring proper testing, commissioning and regular maintenance. Indoor Environmental Quality (EQ) Achieve good quality performance in indoor air quality, acoustics, visual and thermal comfort. These will involve the use of low volatile organic compound materials, application of quality air filtration, proper control of air temperature, movement and humidity. Sustainable Site Planning and Management (SM) Selecting appropriate sites with planned access to public transportation, community services, open spaces and landscaping. Avoiding and conserving environmentally sensitive areas through the redevel-opment of existing sites and brownfields. Implement-ing proper construction management, storm water management and reducing the strain on existing infrastructure capacity. Water Efficiency (WE) Rainwater harvesting, water recycling and water-saving fittings. Materials and Resources (MR) Promote the use of environment-friendly materials sourced from sustainable sources and recycling. Implement proper construction waste management with storage, collection and re-use of recyclables and construction formwork and waste. Innovation (IN) Innovative design and initiatives that meet the objectives of the GBI.
Green Incentives The government, for example, offers tax exemptions on green incentives that help lower capital costs for owners and operators.
Existing Incentives Income Tax (Plant Annual Allowances) Rules 2000 Income Tax (Accelerated Capital Allowances) (Conservation of Energy) Rules 2001 New Incentives* Income Tax (Exemption) (No.8) Order 2009 Stamp Duty (Exemption) Order 2009
* Effective for GBI Certified Buildings from 24 Oct 2010 to 31 Dec 2014.
Cost of Building Green The additional premium in construction cost to build a green building would depend very much on the level of green rating (Basic to Silver, Gold or Platinum) that is being targeted. Green buildings submitted for certification are assessed on the abovementioned six criteria and the points scored would determine its green rating. Due to the wide and numerous variables in building designs, it would make it wholly inappropriate and even simplistic to assign a so-called “typical” percentage in cost premiums to achieve the said ratings. Generally, it is suggested that the higher the rating - e.g. Gold and Platinum - and complexities of the green features would increase the construction cost.
Green Points Table A lists examples where the GBI points can be scored; thus outlining the green features which could be included in a building’s construction planning and design. This would include open ventilation, building orientation, parking facilities for car poolers as well as hard - and green - scapes.
Points
GBI Rating
86+ points
Platinum
76 to 85 points
Gold
66 to 75 points
Silver
50 to 65 points
Certified
Table A
GBI Points Sourcing (Non-Residential) Criteria Energy Efficiency (Max Points: 35)
Indoor Environmental Quality (Max Points: 21) Sustainable Site Planning &Management (Max Points: 16)
Possible additional costs Nominal Moderate Substantial Management Control System (1) EE1: Energy EE2: Flexible lighting control (3) EE4:Encourage renewable energy (5) EE5: Advanced EE performance of up to EE6: Commissioning of Building Energy System (3) BEI* between 90 - 150 (15) EE9: Sustainable maintenance beyond defect & liability period (3) EQ2:Minimise exposure to EQ9: Daylight Glare Control (1) Environmental Tobacco Smoke (1) EQ4: Low VOC building materials (2) EQ6: Individual comfort controls (2) SM1: Site selection (1) SM3: Community connectivity (2) SM10: Nominal parking capacity (1) SM13: Building User Manual (1) SM4: Conservation and open spaces (2) SM12: Heat reducing hardscape, greenery and roof applications (2) MR1:Reuse of Building Materials (2) MR2: Usage of materials with recycled contents (2)
Materials & Resources (Max Points: 11)
MR5: Recyclable materials storage (1)
Water Efficiency (Max Points: 10)
MR7: Environmental-friendly refrigerants and cleaning agents (2) WE1: Rainwater Harvesting (2) WE4: Water efficient fittings (2) WE5: Submeters and detection of water leakage (2) IN2: GBI Facilitator appointment (1) IN1: Innovation in design and environmental initiatives (6)
Innovations (Max Points: 10)
Notes: BEI = Building Energy Intensity in kWh/m2 of annual energy usage
Finding Balance The green building rating is geared towards the objective of pushing the boundaries in building efficiency. Accreditation focuses on the whole construction process to achieve this right from the design stage through to completion. Additional cost premiums to achieve the green rating depending very much on the objectives of a particular building’s efficiency. This additional premium could be recouped over a period of time from the cost savings in energy and water bills, but the greater value would be in its overall contribution towards reducing negative environmental impact. Source: - JUBM/DLS Malaysia Construction News & Views, Issue 2 April 2010 - www.greenbuildingindex.org
MR4: Use of sustainable timber (1)
GBI points in ( )
Estimating Rules of Thumb Composition of Concrete (per m 3 )
Structure Design - Concrete Ratios The following is a range of concrete ratios for building
Mix
Cement
Sand
Aggregate
1:3:6
216kg
0.45m3
0.90m3
1:2:4
308kg
0.43m3
0.86m3
1:1:2
540kg
0.38m3
0.75m3
Weight of Concrete Items
superstructure design: Concrete/floor area
0.4 m3/m2 to 0.5 m3/m2
Formwork/floor area
2.2 m2/m2 to 3.0 m2/m2
Reinforcement
160 kg/m3 to 250 kg/m3
Average External Wall/Floor Ratio
Item
Weight
Concrete
2,400 kg/m3
Cement
1,441 kg/m3
Sand
1,600 kg/m3
Aggregate
1,350 kg/m3
Steel
7,843 kg/m3
Average Loads
Volume
Residential Apartments
1.0 m2/m2
Office, Hotel Industrial
0.4 m2/m2 0.4 m2/m2
Average Internal Wall/Floor Ratio Residential Apartments
1.0 m2/m2
Office Hotel
0.5 m2/m2 1.5 m2/m2
Air - Conditioning Lorry
10.0 m3
Concrete truck (24 ton)
5.5
Barge
m3
200 - 1,450 m3
Dimensions for Standard Parking Space, Loading/ Unloading Bays and Lay-bys
Average
0.05 tonne/m2 of floor area
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particular small foot prints. Indicative Dimensions for Sports Grounds
Minimum Private Cars, Taxis
Length
Width
5 m
2.5 m
Headroom 2.4 m
and Light Vans Coaches and Buses
12 m
3.0 m
3.8 m
Lorries
11 m
3.5 m
4.1 m
Container Vehicles
16 m
3.5 m
4.5 m
Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilation duct, conduits or similar.
Length
Width
Tennis Court
40 m
20 m
Squash Court
13 m
6 m
Basketball Court
38 m
23 m
Volleyball Court
30 m
20 m
Badminton Court
20 m
10 m
Rink
61 m
26 m
Soccer Playing Field Futsal
110 - 120 m 70 - 80 m 25 - 42 m 15 - 25 m
The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed.
Technical Specifications Table for Standard BRC Fabrics BRC Ref. No.
BS 4483 or SS-32 Ref No.
A 10 A9 A8 A7 A 6/5 A5 A4
A 393 A 252 A 193 A 142 A 98 -
B 12 B 10 B9 B8 B7 B6 B5
B 1131 B 385 B 503 B 385 B 283 B 196
Main Wire Cross Wire Size Spacing Size Spacing mm mm mm mm SQUARE MESHES 200 10 200 10 200 9 200 9 200 8 200 8 200 7 200 7 200 6.5 200 6.5 200 6 200 6 200 5 200 5 200 4 200 4 RECTANGULAR MESHES 200 8 100 12 200 8 100 10 200 8 100 9 200 8 100 8 200 7 100 7 200 7 100 6 200 7 100 5
C 10 C9 C8 C7 C6 C5
C 785 C 636 C 503 C 385 C 283 -
10 9 8 7 6 5
400 400 400 400 400 400
6 6 5 5 5 5
100 100 100 100 100 100
Cross-Sectional Area Main Cross mm2/m mm2/m
Mass Per Unit Area Kg/m2
393 318 252 193 166 142 98 63
393 318 252 193 166 142 98 63
6.16 4.99 3.95 3.02 2.61 2.22 1.54 0.99
1131 785 636 503 385 283 196
252 252 252 252 193 193 193
10.90 8.14 6.97 5.93 4.53 3.73 3.05
785 636 503 385 283 196
71 71 49 49 49 49
6.72 5.55 4.34 3.41 2.61 1.93
STANDARD SIZES Rolls (Ref. No’s: A4, A5, A6, A6/5 only) Length : 40.0 metres Width : 2.0 metres Sheets (all Ref. No’s) Length : 6.0 metres Width: 2.2 metres
Weight Tables for Mild Steel Round Bars & High Tensile Deformed Bar Unit No. of Pcs. Weight Cross Std. Size (mm) High Yield Mild Steel Sectional Weight 12m Length Per Bundle (MT) Deformed Round Area (mm2) (kg/m) Per Bundle D6 D8 D9 D 10 D 12 D 16 D 20 D 22 D 25 D 28 D 32 D 35 D 38 D 40
Ø6 Ø8 Ø9 Ø 10 Ø 12 Ø 16 Ø 20 Ø 22 Ø 25 Ø 28 Ø 32 Ø 35 Ø 38 -
28.3 50.3 63.6 78.5 113.1 201.1 314.2 380.1 490.9 615.8 804.2 962.1 1,134.1 1,256.6
0.222 0.395 0.499 0.616 0.888 1.579 2.466 2.984 3.854 4.834 6.313 7.553 8.903 9.864
376 210 168 138 96 54 34 28 22 18 14 12 10 9
1.002 0.995 1.006 1.020 1.023 1.023 1.006 1.003 1.017 1.044 1.061 1.088 1.068 1.065
* High Yield Deformed Bar Standard Length : 12 metres straight. * Mild Steel Round Bar Standard Length : 12 metres straight or 12 metres once folded. * Special cut length can be produced from 6m to 15m on a certain min. quality per size per order upon request.
CONSTRUCTION SECTOR INDICATORS % Change 80
Production (% Change) Other Articles of Concrete, Basic Iron and Construction 2011 Cement & Plaster Steel Products Related Products
60 40
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
20 0
-40
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct
-20
2010
2011
Other articles of concrete, cement and plaster Basic iron and steel products Production of construction related products
- 17.3 - 12.5 - 21.7 - 4.1 2.9 - 3.5 12.9 20.9 46.2 17.8
13.8 16.4 15.7 6.5 22.7 17.9 20.9 8.2 10.3 12.5
9.3 27.7 4.2 - 3.5 2.1 2.9 25.6 - 3.8 - 9.3 6.8
Note: All rates are based on the new Industrial production Index (2005 = 100). November and December rates are not available at time of publication. Source: Monthly Statistical Bulletin, November 2011, Central Bank of Malaysia.
Number
RM Million
Housing Approvals* (number) Loans Approved for Construction Sector (RM miliion)
25,000 20,000 15,000 10,000
0
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov
5,000
2008
Jan
Feb
2009
Mar
Apr
2010
May
Jun
5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0
2011
Jul
Aug
9,005 8,258 13,180 12,655
10,912 16,665
Sep
Oct
Nov
Dec
Housing Approvals* (number)
2010 2011
6,965 12,455
5,757 12,349 8,766 11,781
9,183 11,766 9,354 11,639
10,037 9,865 13,769 12,935 15,674 13,463 20,142 N/A
Loans Approval for Construction Sector (RM million)
2010 2011
1,602 1,867
1,120 1,421
1,793 2,552
1,643 2,738
1,492 1,915
2,288 2,496
2,391 1,779
2,165 2,551
3,094 1,755
2,287 2,991
3,356 4,666
2,292 N/A
Source: Monthly Statistical Bulletin, November 2011, Central Bank of Malaysia. * No. of housing units by private developers approved for construction by the Ministry of Housing and Local Government in Peninsular Malaysia.
AVERAGE UNIT PRICES FOR CEMENT IN MALAYSIA PENINSULAR MALAYSIA North
Central
East
2011
SABAH Kota Kinabalu
Sandakan
SARAWAK Tawau
Kuching
Sibu
Miri
RM/Bag (50 kg)
Jan Feb
15.53 15.61
16.03 16.03
15.86 15.86
17.00 17.00
19.88 19.75
20.50 20.00
16.09 16.09
16.75 16.75
16.38 16.38
Mar Apr May
16.16 16.65 16.63
16.19 16.60 16.69
15.88 16.14 16.18
17.00 17.00 17.00
19.75 19.75 19.75
20.00 20.00 20.00
16.09 16.09 16.09
16.75 16.75 16.75
16.38 16.38 16.38
Jun Jul
16.63 16.60
16.74 16.86
16.18 16.32
17.00 17.00
19.75 19.75
20.00 20.00
16.09 16.09
16.75 16.75
16.38 16.38
Aug Sep Oct
16.80 16.82 16.80
16.93 16.92 16.85
16.32 16.32 16.32
17.25 17.38 17.38
19.88 19.88 19.75
20.00 20.00 20.00
16.79 16.79 16.79
17.42 17.42 17.42
16.95 16.95 16.95
Nov
16.77
16.90
16.32
17.38
19.75
20.00
16.79
17.42
16.95
Note: December 2011 rates are not available at time of publication. Source: Special Release 1 for Peninsular Malaysia, Sabah & Sarawak, by Department of Statistics, Malaysia
CONSTRUCTION COST FOR KUALA LUMPUR RM/m2 SERVICES
BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
TOTAL
1,302 1,974 662 893 2,064 368 462 520
- above - above 903 - 1,334 - above 399 499 572
903 809 168 289 793 99 121 179
- above - above 278 441 - above 131 189 242
2,205 2,783 830 1,181 2,857 467 583 698
- above - above - 1,181 - 1,775 - above 530 688 814
1,344 1,896 1,355
- 1,481 - above - 1,754
940 1,402 830
- 1,155 - above - 1,155
2,284 3,298 2,184
- 2,636 - above - 2,909
2,825 3,429 5,325
- 2,988 - 3,838 - above
1,250 1,192 1,875
- 1,565 - 1,444 - above
4,075 - 4,553 4,621 - 5,283 7,199 - above
782 1,013
-
798 1,008
530 593
-
693 751
1,313 1,607 -
1,491 1,759
840 1,124
-
998 1,218
362 483
-
520 583
1,202 1,607 -
1,518 1,801
971 572 630 809 1,623
-
1,145 730 719 871 1,722
368 210 189 242 540
-
467 289 210 289 641
1,339 782 819 1,050 2,163
1,612 1,019 929 1,160 2,363
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
-
UNIT PRICES FOR UNLEADED PETROL, DIESEL & LIQUEFIED PETROLEUM GAS IN PENINSULAR MALAYSIA
240
185
220
180
200 180
175
160
170
140
Source: Ministry of Domestic Trade, Co-operatives and Consumerism
16-Jun-11
4-May-11
165
2-Apr-11
120
31-Jan-11
175 175 175 185 185 185 190 190 190 190 190
5-Jan-11
180 170 170 175 175 175 180 180 180 180 180
4-Dec-10
175 185 185 190 190 190 190 190 190
2-Nov-10
190 180 180 210 215 230 240 250 270 290 280
16-Jul-10
03-Dec-08 16-Dec-08 12-May-09 16-Jul-10 02-Nov-10 04-Dec-10 05-Jan-11 31-Jan-11 02-Apr-11 04-May-11 16-Jun-11
190
260
12-May-09
175
16-Dec-08
190
3-Dec-08
-
280
18-Nov-08
200
Cent/Kg 195
Unleaded Petrol RON 97 Unleaded Petrol RON 95 Diesel Fuel Liquefied Petroleum Gas
1-Nov-08
18-Nov-08
Cent/Litre 300
15-Oct-08
Liquefied With Petroleum Gas (LPG) Effective RON 97 RON 95 (Cent/Litre) (Cent/Litre) (Cent/kg)
25-Sep -08
Diesel Fuel
23-Aug -08
Unleaded Petrol
COMMODITIES PRICE TREND (JAN TO DEC 2011) Nickel
Aluminium
USD/Tonne 29,500
USD/Tonne 2,800
28,500 2,700
27,500 26,500
2,600
25,500
2,500
24,500
2,400
23,500 22,500
2,300
21,500 2,200
20,500 19,500
2,100
18,500 2,000
17,500 16,500
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
1,900
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Copper (Grade A) USD/Tonne 10,500
10,000
9,500
9,000
8,500
8,000
7,500
7,000
6,500
Jan
Feb
Mar
Apr
May
Source: London Metal Exchange
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Year 2011
Aluminium
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2,438.73 2,507.33 2,551.76 2,661.92 2,591.18 2,554.66 2,511.19 2,391.66 2,295.93 2,171.48 2,072.75 2,023.58
Copper (Grade A)
Nickel
Monthly Average (USD / Tonne)
9,554.13 9,866.75 9,529.57 9,482.56 8,925.93 9,044.80 9,618.36 9,040.34 8,313.82 7,346.71 7,550.95 7,569.43
25,638.50 28,246.75 26,803.04 26,321.39 24,203.00 22,344.32 23,721.43 22,075.23 20,384.55 18,879.29 17,876.82 18,129.50
MALAYSIA TIMBER PRICES Monthly Average - Year 2011
Yearly Average
(USD/m3) Jan
Feb
Mar
Apr
May
Jun
N/A N/A N/A
493 294 345
497 300 350
500 303 352
N/A N/A N/A
462 427 396
469 434 405
470 435 407
Jul
(USD/m3)
(RM/m3) USD$1 = RM3.15 Nov Dec* 2010 2011 2010 2011
% Change
Aug
Sep
Oct
505 307 354
510 309 356
512 310 356
512 310 356
512 310 356
511 486 309 284 354 339
503 1,529.98 1,584.45 303 893.81 954.45 351 1,066.40 1,105.65
3.56 % 6.78 % 3.68 %
473 439 410
478 443 414
479 444 415
478 444 415
475 442 413
474 444 440 408 412 375
470 1,397.15 1,480.50 435 1,283.75 1,370.25 406 1,182.44 1,278.90
5.97% 6.74 % 8.16 %
MALAYSIA SAWNWOOD
Domestic Merbau 491 Kempas 290 Balau 343
492 291 344
MALAYSIA PLYWOOD
2.7 mm 3.0 mm 9.0 mm
455 419 387
457 422 391
Note: * 1st Half of December 2011 only. Rates for March 2011 are not available due to earthquake Source: International Tropical Timber Organisation (www.itto.or.jp)
MALAYSIA CONSTRUCTION SECTOR - EMPLOYMENT & GDP Employment (’000)
% 6.90
770.0
6.80 6.70
765.0
6.60 6.50
760.0
6.40 6.30
755.0
6.20 6.10
750.0
06
07
08
09
10
11*
6.00
Year Employment for Construction Sector Contribution to Total Employment
GDP (RM million)
%
20,000
3.35 3.30
18,000
3.25 3.20
16,000
3.15 3.10
14,000
3.05 12,000
06
07
08
09
10
11*
12**
3.00
Year Gross Domestic Product (GDP) for Construction Sector Contribution to Total GDP Note: * Estimate by Ministry of Finance Malaysia ** Forecast by Ministry of Finance Malaysia Source: Economic Report 2011/2012, Ministry of Finance, Malaysia
CONSTRUCTION COST FOR JOHOR BAHRU BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
1,390 2,025 720 910 1,800 410 450 465
-
above above 810 1,079 above 415 530 545
810 675 80 250 600 90 100 135
-
above above 90 296 above 95 120 155
2,200 2,700 800 1,160 2,400 500 550 600
-
above above 900 1,375 above 550 650 700
1,130 1,650 1,185
-
1,385 above 1,435
670 1,270 615
-
815 above 765
1,800 2,920 1,800
-
2,200 above 2,200
2,100 2,550 3,960
-
2,220 2,855 above
1,044 955 1,410 -
1,205 1,140 above
3,144 3,505 5,370
-
3,425 3,995 above
700 850
-
770 915
400 510
-
680 720
1,100 1,360
-
1,450 1,635
690 1,020
-
770 1,155
255 430
-
460 495
945 1,450
-
1,230 1,650
680 460 560 700 1,400
-
835 690 640 865 1,635
220 140 140 180 400
-
265 210 160 220 465
900 600 700 880 1,800
-
1,100 900 800 1,085 2,100
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COST FOR PENANG BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
900 1,780 570 870 1,100 420 440 455
-
above above 700 1,030 above 470 520 600
450 870 95 285 450 65 140 170
-
above above 125 330 above 70 180 200
1,350 2,650 665 1,155 1,550 485 580 625
-
above above 825 1,360 above 540 700 800
1,100 1,600 1,200
-
1,300 above 1,400
900 1,250 720
-
1,000 above 850
2,000 2,850 1,920
-
2,300 above 2,250
2,200 2,700 4,300
-
2,500 3,300 above
1,000 960 1,500
-
1,300 1,450 above
3,200 3,660 5,800
-
3,800 4,750 above
620 650
-
800 800
500 580
-
630 700
1,120 1,230
-
1,430 1,500
510 540
-
680 820
500 400
-
560 600
1,010 940
-
1,240 1,420
650 460 575 650 1,300
-
780 595 650 740 1,450
270 200 160 195 500
-
300 270 200 240 610
920 660 735 845 1,800
-
1,080 865 850 980 2,060
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COSTS FOR KOTA KINABALU RM/m2 SERVICES
BUILDING DOMESTIC
TOTAL
1,360 2,060 700 940 2,160 380 470 550
-
1,450 above 940 1,390 above 410 530 600
419 992 287 353 926 121 165 209
-
529 above 342 419 above 165 187 221
1,779 3,052 987 1,293 3,086 501 635 759
-
1,979 above 1,282 1,809 above 575 717 821
Average standard offices, high rise Prestige offices, high rise Shopping centres
1,390 1,980 1,410
-
1,580 above 1,930
860 1,433 860
-
992 above 992
2,250 3,413 2,270
-
2,572 above 2,922
HOTELS
2,950 3,590 5,570
-
3,130 4,010 above
1,158 1,422 2,282
-
1,422 1,566 above
4,108 5,012 7,852
-
4,552 5,576 above
820 1,050
-
880 1,100
419 496
-
518 562
1,239 1,546
-
1,398 1,662
880 1,180
-
1,090 1,330
353 419
-
419 507
1,233 1,599
-
1,509 1,837
890 600 650 850 1,690
-
1,050 760 750 920 1,800
243 187 232 254 706
-
287 221 364 287 860
1,133 787 882 1,104 2,396
-
1,337 981 1,114 1,207 2,660
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COST FOR KUCHING BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
1,030 1,600 900 1,050 1,460 520 730 780
-
1,160 above 970 1,140 1,580 590 790 850
440 770 150 280 790 110 150 160
-
530 above 190 380 950 130 170 220
1,470 2,370 1,050 1,330 2,250 630 880 940
-
1,690 above 1,160 1,520 2,530 720 960 1,070
1,440 1,680 1,570
-
1,690 above 1,700
880 1,510 760
-
1,000 above 950
2,320 3,190 2,330
-
2,690 above 2,650
2,640 2,830 4,550
-
3,040 3,100 above
1,310 1,500 2,300
-
1,580 1,650 above
3,950 4,330 6,850
-
4,620 4,750 above
950 1,010
-
1,180 1,170
340 400
-
370 480
1,290 1,410
-
1,550 1,650
750 1,020
-
880 1,170
280 420
-
390 500
1,030 1,440
-
1,270 1,670
1,030 800 910 1,100 1,690
-
1,140 900 1,030 1,240 1,820
350 220 210 240 680
-
370 230 330 290 820
1,380 1,020 1,120 1,340 2,370
-
1,510 1,130 1,360 1,530 2,640
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies
MAJOR RATES FOR MALAYSIA RM
1. Excavating basement ≤ 2m deep 2. Excavating for footings ≤ 1.5m deep 3. Remove excavated materials off site 4. Hardcore bed blinded with fine materials 5. Mass concrete grade 15 6. Reinforced concrete grade 30 7. Mild steel rod reinforcement 8. High tensile rod reinforcement 9. Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting 13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
m3 m3 m3 m3 m3 m3 kg kg
KUALA LUMPUR
15 15 20 60 230 250 3.50 3.50
- 20 - 20 - 25 - 70 - 250 - 280 - 3.80 - 3.80
PENANG
12 13.6 5 50 225 230 3.40 3.40
- 16.5 - 21.8 - 13 - 70 - 265 - 270 - 3.80 - 3.80
JOHOR BAHRU KOTA KINABALU
18 13 12 70
KUCHING
- 21 - 15 - 15 - 80 255 280 3.50 - 4.00 3.50 - 4.00
12 15 10 100 310 356 3.70 3.60
15 15 15 75 280 330 3.50 3.50
m2 m2 m2
30 - 38 30 - 38 32 - 45
25 - 34 25 - 34 35 - 40
35 35 45 - 50
36 36 40
38 38 38
m2
55 - 60
60 - 85
75 -
86*
86
m2
350 - 500
260 - 360
250 - 350
250 - 350
320
kg
6.00 - 7.50
5.50 - 9.00
7.50 - 8.50
6.50 - 7.00
7
kg m2
6.00 - 7.50 15 - 22
5.50 - 9.00 13.5 - 19.0
7.50 - 8.50 18 - 23
6.50 - 7.00 17
7 18
m2 m2 m2 m2 %
22 70 45
12 - 21 35 - 70 21 - 35
3.50 - 4.50 6 - 12
15 50 30 -
23 55 35 -
80
25 65 45
18 78 56
15 68 55
3.20 - 5.00
4.50 - 5.50
8.50
11
3 - 5
4.50 - 7.50
4 - 7
8.5
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies and preliminaries. * Rates is for “Kliplok Colorbond” 0.54mm profiled steel sheeting.
ACMV Costs for Various Designs & Developments in Kuala Lumpur ACMV : Air Conditioning & Mechanical Ventilation System
RM/m2 of Construction Floor Area
RM/Tonne of Refrigeration
500
8000 400
400
200
4000 2000
Central Constant Air Volume
Central Variable Refrigerant Volume
RM/m2 of Construction Floor Area
10000 400
391
7500
278
6600 5000
5000
6200
Commercial Complex
1200
Hotel
1300
Factory
2000
Residential
Commercial Complex
Hotel
Residential
Office
0
2000
Office
2500
90
0 Academic Institution
7500
4600
60
Hospital
7500
200
100
8500
7600
Academic Institution
100
280
Central Variable Refrigerant Volume
RM/Tonne of Refrigeration
6500
280 190
200
Central Constant Air Volume
8400
350 310
Central Variable Air Volume
450
Factory
300
0
Hospital
Central Variable Air Volume
450
400
4000
210
100
500
4500
5200
250
260
6000
6650
6000
350
360
300
0
7400
UNIT COSTS FOR ANCILLARY FACILITIES FOR KUALA LUMPUR DESCRIPTION PLAYGROUND EQUIPMENT Outdoor playground equipment comprising various activities and safety mat Minimum recommended area: 13.97m x 13.61m Age group: 4 to 12 Child Capacity: 20 - 30 * Price varies according to equipment and design.
UNIT
per set
SAUNAS Sauna room for 4 - 5 people complete with timber finishes, stainless steel heater with built-in control panel and all accessories per room Size: 5’ x 5’ x 6’6” STEAM BATHS Steam bath for 5 - 6 people complete with steam generator, tempered glass door, ceramic wall tiles, water proofing system, lighting and all accessories Size: 5’ x 5’ x 7’6”
per room
GOLF COURSES (Based on “Average Cost Model” of an 18 hole golf course in Asia). Including fairway construction and rough hydro seeding.
per hole
GOLF SIMULATOR Complete golf simulation system complete with projector, high impact projection screen, artificial grass putting turf, putting green
per set
RM
DESCRIPTION
UNIT
RM
SQUASH COURTS Single court with glass back wall including associated mechanical and electrical services but excluding any public facilities (enclosing structure not included)
per court
46,500
40,000
TENNIS COURTS Single court on grade with acrylic surfacing complete excluding chain link fence
per court
69,000
12,000
SWIMMING POOLS Size: 25m x 10.5m Depth: approx. 1.2m to 1.8m Outdoor swimming pool built on ground, fully tiled, completed with 5m wide deck and associated equipment
per pool
715,000
Extra for heating equipment (solar)
per pool
150,000
Extra for ozone system
per pool
210,000
Size: 25m x 10.5m Depth: approx. 1.8m to 3.0m Indoor swimming pool built with suspended structure (enclosing structure not included) fully tiled and completed with 5m wide deck, including mechanical ventilation and associated equipment
per pool
1,045,000
Extra for heating equipment (solar)
per pool
250,000
Extra for ozone system
per pool
300,000
18,500
2,000,000
275,000
RESIDENTIAL Existing Stock (unit)
Incoming Supply (unit)
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
411,694 1,292,318 4,479 677,542 353,583 387,910 233,123 155,823 264,897 214,693 54,418 56,761 20,801 145,145 11,153 200,256
41,145 136,095 834 82,530 47,383 34,168 66,399 14,627 37,031 27,284 18,310 13,125 1,996 38,444 636 18,316
MALAYSIA
4,484,596
578,323
Residential p Q3 2011
p = preliminary
Projection of Cumulative Supply for High End Condominiums Number of units 35000 30000 25000 20000 15000 10000 5000 0
2008
2009
Bangsar / Damansara Heights
2010 Ampang Hilir / U-Thant
1H2011
2H2011
Mont' Kiara
2012 KL City
Source: Residential Property Stock Report, 3rd Quarter 2011, by Valuation & Property Service Department & Knight Frank
Average Capital Values and Asking Rental Rates for Luxury Condominiums in Kuala Lumpur Average Capital Values RM psf
Average Asking Rental Rates RM psf per month
Asking Prices and Rentals of Existing High End Condominiums (1H 2011)
5.50
1,200
5.00
1,000
971 4.50
800 712 4.00
600
4.00
558
400
3.32 3.12
200
3.50 3.00 2.50
2004
2005
2006
Average Asking Rental Rates for Average Capital Values for
2007
2008
KLCC KLCC
2009
Bangsar Bangsar
Source: CB Richard Ellis and Knight Frank
2010
2011 Q3
Mont Kiara Mont Kiara
Locality
KL City* Ampang Hilir / U-Thant Damansara Heights** Kenny Hills Bangsar ’ Mont Kiara***
Gross Rent (RM psf/month)
3.00 - 6.00 3.00 - 4.00 3.20 - 4.00 3.00 - 4.00 2.50 - 4.50 2.00 - 3.50
Asking Selling Price (RM psf)
700 - 1,800 500 - 900 400 - 900 500 - 900 500 - 1,100 400 - 650
Notes: * Excludes The Binjai On The Park ** Includes Clearwater Residence *** Excludes Verve Suites which comprises mainly fully furnished small units
HOTEL Existing Stock Incoming Supply (Room) (Room)
4-Star
3-Star
65.0 60.0 55.0 50.0 45.0
Q32011p
25,810
2010
2009
2008
2007
2006
2005
2004
2003
40.0
Q22011
173,425
5-Star
Q12011
MALAYSIA
% 70.0
6,587 3,250 359 6,098 654 996 744 1,172 188 1,639 921 557 212 1,048 444 941
2002
31,806 13,903 401 17,398 13,703 9,671 4,764 8,697 9,664 21,472 6,926 3,570 688 14,138 1,013 15,611
2001
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
Average Occupancy Rate of Hotels by Star Rating
2000
Hotel p Q3 2011
P = Prediction
p = preliminary
Source: Leisure Property Stock Report, 3rd Quarter 2011 by Valuation & Property Services Department
Tourist Arrivals & Receipts to Malaysia RM Million
Million
60,000
30
Receipts (RM mil) Arrivals (Mil)
50,000
25
1H 2007 2H 2007 1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
4 Star RM/Night
5 Star RM/Night
180 183 200 202 210 208 209 216 209
290 330 370 377 388 380 345 347 339
2010
2009
2008
2007
0
2006
-
2005
5
2004
10,000
2003
10
2002
20,000
2001
15
2000
30,000
1999
20
1998
40,000
Source: Tourism Malaysia
Average Room Rates for 5-star & 4-star Hotels in Kuala Lumpur City Centre
Source: Knight Frank
OFFICE Major Office Investment Sales in 1H 2011
Approx Lettable Area (SF)
RM psf
Dua Sentral, Jalan Tun Sambanthan
430,000
540
Block 6, The Horizon (Phase 1), Bangsar South
46,100
780
Prima 9, Cyberjaya
111,000 (1)
650
Prima 10, Cyberjaya
100,000 (1)
610
Average Gross Rental per month RM psf 11.00 10.00 9.00
1H08 RM psf
1H09 RM psf
1H10 RM psf
1H11 RM psf
8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00
Vacancy Rates of Office Space in KL City Center Vacancy Rate (%) 25.0%
20.0%
15.0%
10.0%
5.0%
0.0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 3Q 2011
KL City
Golden Triangle
Central Business District
Menara Millenium
Menara HLA
Menara Etiqa Twins
Menara Std Chartered
Menara Citibank
Menara IMC
0.00 Menara Maxis
Notes: (1) Prime 9 and Prime 10 have a total of 374 and 307 car park bays respectively. Source: Knight Frank
Purpose Built Office Existing Stock Occupancy Rate Incoming Supply p Total Space (m2) (%) (m2) Q3 2011
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak MALAYSIA
6,946,558 2,409,106 1,800,605 1,015,878 1,097,496 621,152 280,794 361,096 309,611 298,409 299,879 358,421 90,706 674,554 66,157 578,757
17,209,179
79.60 77.80 86.10 74.80 75.50 93.80 92.10 84.80 91.60 93.40 97.80 95.50 98.50 89.10 80.20 92.10
82.30
1,189,092 431,497 373,348 180,301 38,789 5,071 5,097 17,398 14,305 99,902 16,837 22,128 64,270 67,963 28,022 7,378
2,561,398
p = preliminary
Source: Commercial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Service Department and CB Richard Ellis
SHOPPING COMPLEX Shopping Complex's Existing Stock & Occupancy Shopping Complex Existing Stock Occupancy Rate Incoming Supply Rate in Kuala Lumpur & Selangor (By Location) p Total Space (m2) (%) (m2) Q3 2011 as at Q3 2011
Existing Stock
Occupancy
700,000
%
100
600,000 90
500,000 400,000
80
300,000 200,000
70
1,839,673
Bangsar
Klang
-
Shah Alam
100,000
Bukit Bintang / Jalan Raja Chulan
80.60
m2
Jalan Ampang
10,878,248
635,734 146,763 9,907 213,770 82,176 193,289 44,475 25,344 50,411 32,657 4,265 4,320 6,720 130,271 0 259,569
Central Commercial Area
MALAYSIA
86.90 85.60 75.30 71.30 69.30 86.80 82.40 79.50 75.60 81.70 71.10 87.40 97.80 85.10 98.30 73.00
Subang Jaya / Sunway
2,120,792 2,591,801 67,714 1,507,307 1,406,060 573,940 340,892 358,520 391,772 219,302 86,836 218,534 66,829 535,993 26,063 365,893
Petaling Jaya
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
60
p = preliminary
Source: Commercial Property Stock Report 3rd Quarter 2011 by Valuation & Property Service Department
Klang Valley Prime Retail Rental Index 300
Rental Index (Q4 1995 = 100)
250
Shopping Centres Completed / Scheduled for Completion in 2H2011
200
New Projects
150
Publika Mall @ Solaris Dutamas, Hartamas 1 Shamelin, Cheras Kenanga Wholesale City, Pudu Southgate, Jalan Tun Razak KL Festival City, Setapak Mines 2, Seri Kembangan First Subang, Subang Jaya Space U8, Shah Alam
100 50
Source: CB Richard Ellis
3Q 2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
0
Source: Knight Frank
Estimate Net. Lettable Area (sf)
335,000 420,000 500,000 189,000 450,000 295,000 120,000 574,000
SHOP Shop p Q3 2011
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak MALAYSIA
Existing Stock Incoming Supply (unit) (unit)
23,084 77,317 198 67,521 28,238 42,201 18,182 16,531 25,513 17,379 4,794 8,199 3,346 15,858 794 22,699
1,793 12,154 229 9,539 3,772 3,257 3,415 3,068 3,289 2,817 1,117 2,197 369 1,932 74 1,818
371,854
50,840
Distribution of Existing and Planned Supply of Shop in Kuala Lumpur and Selangor as at Q3 2011
724 ; 8.16%
30,153 ; 30.04%
887 ; 9.99%
7,415 ; 7.39% 2,376 ; 2.37% 240 ; 0.24% 11,353 ; 11.31%
162 ; 1.82% 251 ; 2.83% 370 ; 4.17%
p
Existing
534 ; 0.53% 665 ; 0.66% 1,294 ; 1.29%
543 ; 6.12%
28,306 ; 28.20%
955 ; 10.76%
2,732 ; 30.78% p
Planned Supply
18,035 ; 17.97%
2,253 ; 25.38%
p = preliminary
Pre-War 5-5 1/2 Storey
1-1 1/2 Storey 6-6 1/2 Storey
2-2 1/2 Storey Above 6 1/2 Storey
3-3 1/2 Storey Lock-Up
p = preliminary
Source: Commercial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Service Department
4-4 1/2 Storey SOHO
INDUSTRIAL Distribution of Existing and Planned Supply of Industrial in Kuala Lumpur and Selangor as at Q3 2011
Industrial p Q3 2011
29,346 ; 74.07% 412; 22.42%
689; 37.49%
Existingp
Planned SupplyP 25; 1.36%
121 ; 0.31% 1,386 ; 3.50% 4,803 ; 12.12%
p = preliminary
7; 0.38% 705; 38.36%
3,962 ; 10%
Terraced
Semi-Detached
Flatted Factory
Industrial Complex
Detached
Existing Stock Incoming Supply (unit) (unit)
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
5,160 34,458 48 13,476 7,682 7,078 4,747 4,140 3,190 3,313 716 458 165 4,266 605 4,227
35 2,792 35 789 237 428 1,286 263 58 332 11 80 19 1,013 0 447
MALAYSIA
93,729
7,825
p = preliminary
Source: Industrial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Services Department.
MALAYSIA BALANCE OF TRADE Trade Balance RM million
Import/Export RM million
190,000
800,000
170,000
700,000
150,000
600,000
130,000
500,000
110,000
400,000
90,000 70,000
300,000
50,000
200,000 00 01 02 03 04 05 06 07 08 09 10 11*12** Trade Balance Import (RM million) Export (RM million)
Year
Exports
Imports
(RM mil)
(RM mil)
Trade Balance (RM mil)
2000 2001
374,033 334,326
294,889 264,472
79,144 69,854
2002 2003 2004 2005
358,504 397,969 481,903 539,420
286,387 300,207 377,129 410,529
72,117 97,762 104,774 128,892
2006 2007
590,018 605,175
452,726 475,687
137,292 129,488
2008 2009 2010
663,875 554,067 640,043
492,076 412,322 505,317
171,799 141,745 134,726
2011*
682,707
543,025
139,682
2012**
723,968
581,248
142,721
Note: * Estimate ** Forecast Source: Economic Report 2011/2012, Ministry of Finance, Malaysia
CONSUMER PRICE INDEX % Change in CPI 6.0 5.0 4.0 3.0 2.0 1.0
Year
Year
CPI
% Change
2000
80.4
1.5 %
2001
81.5
1.4 %
2002
83.0
1.8 %
2003
83.9
1.2 %
2004
85.1
1.5 %
2005
87.7
3.0 %
2006
90.9
3.5 %
2007
92.7
2.0 %
2008
97.8
5.5 %
2009
98.3
0.6 %
2010
100.0
1.7 %
2011*
103.1
3.1 %
Note: Year 2010 is the Base Year * Average from January to November 2011 only Source: Department of Statistics, Malaysia
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0.0
INTEREST RATES: BANKING INSTITUTIONS Percent Per Annum 9.00 8.00 7.00 6.00 5.00 4.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Commercial Banks : Base Lending Rates Commercial Banks : Average Lending Rates Investment Banks : Average Lending Rates
Commercial Banks Base Lending Rates (%)
Average Lending Rates (%)
Investment Banks Average Lending Rates (%)
Jan Feb
6.27 6.27
5.10 5.07
7.27 7.20
Mar Apr May
6.27 6.27 6.54
5.06 5.06 5.10
7.19 7.17 7.12
Jun Jul Aug Sep Oct
6.54 6.54 6.54 6.54 6.54
5.07 5.03 5.05 5.05 5.03
7.05 6.91 7.01 6.99 6.95
Nov
6.54
5.06
6.99
2011
Note: December rates are not available at time of publication. Source: Monthly Statistical Bulletin, Central Bank of Malaysia
EXCHANGE RATES as at 1 January 2012
Country
Currency
RM1
US $1
Australia
dollar
0.3082
0.9792
Bahrain
dinar
0.1185
0.3764
Brunei
dollar
0.4028
1.2795
China
rmb
1.9923
6.3290
Egypt
pound
1.8956
6.0221
ecu
0.2428
0.7712
dollar
2.4441
7.7643
India
rupees
16.9353
53.8000
Indonesia
rupiah
2,853.87
9,066.2
Japan
yen
24.1900
76.860
Kenya
shillings
26.3116
83.587
Lebanon
pound
470.149
1,493.6
Malaysia
ringgit
1.0000
3.1706
New Zealand
dollar
0.4046
1.2854
Pakistan
rupee
28.1484
89.422
Philippines
peso
13.7529
43.690
riyal
1.1462
3.6411
Singapore
dollar
0.4080
1.2960
South Africa
rand
2.5307
8.0396
South Korea
won
364.97
1,159.42
Sri Lanka
rupee
35.820
113.792
Thailand
baht
9.7545
30.988
United Arab Emirates
dirham
1.1561
3.6726
United Kingdom
pound
0.2025
0.6432
United States of America
dollar
0.3148
1.0000
Vietnam
dong
6,581.2
20,907.1
European Currency Unit Hong Kong
Qatar
Source: www.oanda.com/convert/classic
CURRENCY CHART Ringgit (RM) 8.00 7.50 7.00 6.50 6.00 5.50 5.00 4.50 4.00 3.50 3.00 2.50 2.00 1.50 2001
2002
2003
RM per 1 USD RM per 1 SGD
2004
2005
2006 RM per 1 GBP RM per 1 EURO
2007
2008
2009
2010
RM per 100 JPY RM per 100 PAK
2011 Year
TELEPHONE DIRECTORY (MALAYSIA) Ministries/Departments Department of Statistics Malaysia Department of Town and Country Planning Ministry of Dom. Trade, Co-operatives & Consumerism Ministry of Entrepreneur & Co. Operative Dev. Ministry of Housing and Local Government Ministry of Science, Technology and Innovation Ministry of Works Malaysia Kuala Lumpur City Hall (DBKL) Penang Island Municipal Council Perbadanan Putrajaya Petaling Jaya City Council (MBPJ) Shah Alam City Council (MBSA) Subang Jaya Municipal Council (MPSJ) Public Works Department Malaysia (JKR) SIRIM Berhad The Malaysia Highway Authority
03-8885 7000 03-2698 9211 03-8882 5500 03-8880 5000 03-8891 5000 03-8885 8000 03-2711 1100 03-2617 9000 04- 259 2020 03-8887 7000 03-7956 3544 03-5510 5133 03-8026 3131 03-2691 9011 03-5544 6000 03-8737 3000
Contractor’s Association Master Builders Association Malaysia Contractor’s Registration Board
03-7984 8636
Construction Industry Development Board Professional Registration Boards
03-2617 0200
Board of Architects Malaysia Board of Engineers Malaysia Board of Quantity Surveyors Malaysia
03-2698 2878 03-2696 7095 03-2696 7999
Professional Bodies Assoc. of Consulting Engineers Malaysia (ACEM) Malaysia Institute of Architects (PAM) Malaysian Institute of Planners (MIP) The Institution of Engineers Malaysia (IEM) The Institution of Surveyors Malaysia (ISM) Other Important Numbers
03-2095 0031 03-2693 4182 03-7877 0636 03-7968 4001 03-7955 3333
Ambulance & Police Civil Defence (Rescue) Fire Fighter General Hospital KL Bursa Malaysia SYABAS Sdn Bhd Tenaga Nasional (KL)
999 999 999 03-2615 5555 03-2034 7000 03-2088 5400 03-2296 5566
About Us Davis Langdon & Seah Pakistan (Private) Limited (DLSPK) was established in Karachi in late 2007, spearheading a field relatively unheard of in Pakistan - Quantity surveying and cost management. Being pioneers, DLSPK is partly responsible assist in the building of a strong group of qualified field professionals for years to come. Hence, the publication of the DLS Construction Cost Handbook Pakistan 2009 providing an extensive database for accurate assessment in cost management and quality Quantity Surveying services. This is our second edition, published with technical support from DLS Malaysia, our partner in the proud network that is DLS International with a total of 105 offices and 5,000 staff worldwide. Focusing on Pakistan’s construction cost profiles as well as the major cities in Asia; this handbook serves as general reference on construction cost indicators for project budgeting, appraisals and costing purposes. The information within was compiled by DLSPK. Actual unit prices may vary project to project, depending upon the nature of work, quantum, location and prevalent economic conditions. For further information and/or advice relating to particular project, please contact us at the address provided at the end of this handbook. DLSI has been involved in the publication of construction costs handbooks for countries including Malaysia, Hong Kong, Philippines, Vietnam and Singapore; and is also the editor of the Spon’s Price Book Series. Global Reach .... Local Delivery
Davis Langdon & Seah Pakistan (Private) Limited Quantity Surveyors & Construction Cost Consultants
Industry Overview Housing and construction has been identified as one of the four priority sectors for growth and poverty alleviation for two reasons: one, because it is labor intensive, and two because it has backward and forward linkages with at least 40 other industries. The housing situation in Pakistan has steadily deteriorated over the past many years for a variety of reasons including ineffective policies, resulting in huge housing backlog. According to the last census held in 1998, the total number of housing units throughout the countries was 19.3 million. The housing backlog, as estimated according to the census, was 4.30 million units which then projected in 2004 to 6.0 million units. The annual additional requirements is estimated at 570,000 housing units whereas the annual production is estimated at 300,000 housing units, resulting in a recurring shortfall of 270,000 housing units annually. It is estimated that in order to address the backlog and to meet the housing shortfall in the next 20 years the overall housing production will have to be increased to 820,000 housing units annually. Recognizing the gravity of the situation and realizing the potentials of housing and construction as productive sector of the economy, the present government has declared Housing and Construction as priority industry and also formulated a pragmatic and workable National Housing Policy with a view to: a) Accelerate housing activity and contribute towards employment generation and economic development b) Facilitate provisions of housing inputs including land, finance and building materials, institutional and legal framework c) Analyse the culture of poverty and the forces generating ever increasing slums and squatters including political, public, socioeconomic, bureaucratic and environmental forces d) Promote ways and means for housing development by enhancing affordability, saving capacity, human tendencies and potential e) Provide safeguards against malpractices, bureaucratic inefficien-cies, institutional weaknesses, and f) Particularly for low income groups The Pakistan Housing Authority (PHA) has been entrusted to spearhead the construction of thousands of apartments for low income groups. The followings are some of the measures initiated under the “Housing for ALL” programme: a) Housing schemes for Government employees launched in all districts of the country for which the provincial governments and ICT will provide (100) acres of State land at affordable price b) Housing schemes for Government employees to be developed on public private partnership basis in which Banks will participate through appropriate collaboration with the private sector developers. Such partnership shall be secured on competitive basis through a transparent selection process
c) Federal/ Provincial/ District Government shall facilitate and provide all necessary support to Banks/Developers with a view to creating enabling environment d) Federal Government will ensure the provision of trunk infrastruc-ture at the project sites from National Utilities regarding electric-ity, gas and telephone. If required Banks may finance extra cost of such infrastructure e) Federal/ Provincial Government will ensure provision of trunk infrastructure for housing schemes f) Provincial Government will make the necessary legislation, if required, for transfer of state land at realistic/affordable rates for the Government employees housing schemes g) Rationalization of the rate of registration fees, stamp duty and property tax to promote housing sector by the Provincial governments
Selection of Design Consultants The professions are regulated by the appropriate professional bodies – Institute of Architects Pakistan (IAP), Institute of Engineers Pakistan (IEP) and Association of Consulting Engineers Pakistan (ACEP), Individual professional consultants have to register with their respective professional boards. Pakistan Engineering Council (PEC) is the regulatory body for engineering works. It is compulsory for all practicising engineers and engineering firms to be registered with PEC. Architects and town planners shall register individually (not as a firm) with Pakistan Council of Architect and Town Planners (PCATP) which is the regulating body for architects and town planners. There is no independent body for quantity surveyors. Quantity surveying works are normally done in house as an integral part of the engineering and/or architectural practices. In the private sector, most consultants are selected and appointed by the developers based on track record and personal relationships besides cost consideration. In the public sector, the selection criteria of project consultants are based on experience, quota, contracts and cost. The consultants must be registered with the various development authorities such as Capital Development Authority Islamabad, Rawalpindi Development Authority, Rawalpindi District Council, Karachi Building Control Authority (KBCA), PHA, PWD, Defence Housing Authorities etc.
Contractual Arrangements In the public sector, there are various forms of contract being used for large tender bids, which are essentially modified FIDIC Forms of Contracts. For smaller projects simple forms of contract are normally used. The Public Works Department usually invites contracting companies to tender through open advertisements in the major newspapers. Sometimes, tenderers are selected through a pre-qualification exercise for larger jobs. For private sector projects the most common procurement method is by selective tendering. In the private sector, the PEC Engineering Forms of contract are widely adopted. Bill of Quantities, drawings and specification are commonly used as the basis for tender. Pakistan Engineering Council produced the following standard bidding/contract documents with modifications based on FIDIC and World Bank formats and specifically tailored to be in line with relevant PEC construction and consultancy Bye laws and Govern-ment of Pakistan requirements:a) Standard form of bidding documents (civil works) – to be used for construction contract over Rs 50 millions b) Standard form of tender documents for procurement of works (electrical and mechanical) – to be used for E&M procurement contract over RS 50 millions. c) Standard form of tender documents for procurement of works (for smaller contracts) – to be used for all type of procurement contract below Rs 50 million. d) Standard form of contracts for engineering consultancy for large projects (Time based/Lump sum assignments) and smaller projects. The documents are applicable to all projects to be executed in Pakistan.
Development Control Presently the functions of development control are contended by several institutions. For instance Karachi Building Control Authority (KBCA), created under the provision of Sindh Building Control Ordinance 1979, is one of the legal valid bodies undertaking this task. KBCA is a regulatory and supervisory body whose prime function is to approval of building plans and “No Objection Certificates (NOC)” etc. and conformation with the existing Building & Town planning regulations. However the quality, soundness and implementation of appropriate design/specifications is the sole responsibility of the concerned professionals licensed by KBCA under Karachi Building Control Licensing Regulations 1982. City District Government (CDGK) has also its own claim under the Sindh Local government Ordinance. Federally controlled and constituted bodies such as Cantonment Board of the Ministry of Defence, Karachi Port Trust, Pakistan Railways, Ministry of Works Pakistan, Board of Revenue, Sindh Katchi Abadies Authorities, Sindh Industrial Trading Estates Karachi have their own jurisdiction which stands untainted from the other local authorities. Similarly other autonomous land owning agencies such as public universities are not controlled by the conventional building control practices. In general all developments must adhere and conform to the Town Planning and Building Control in accordance with Master Plan and Environmental Control (Building and Town Planning Regulations 2002, given cover under Sindh Building Control Ordinance (SBCO) 1979), and the developers/builders must obtain the followings: a) Building Plan approvals and NOCs from the various utilities authorities b) Approval of Structural Designs of Buildings c) Obtaining of NOCs for sale and advertisement for public sale projects i.e. fixation/approval of unit price, time period and specifications of construction and development d) Submission of as built plan upon completion e) Obtaining occupation/completion certificate.
Standards Generally the specifications for construction works are based on the latest edition of Pakistan Standards, British Standards (BS), American Concrete Institute Standards (ACI), American Society for Testing and Materials Standards (ASTM).
Construction Cost Specification For Pakistan The building costs per unit area given are averages incurred by building clients for typical buildings in the urban area as at 4th quarter 2008. They are based upon the total floor area of all storeys measured between external walls and without deduction for internal walls. Approximate estimating costs generally include mechanical and electrical installations but exclude furniture, loose or special equipment, and external works; they also exclude fees for professional services. The cost shown are for specifications and standards appropriate to Karachi and this should be borne in mind when attempting comparisons with similarly described building types in other countries.
Major Rates The unit rates provided are for main work items in a typical construction project in the Karachi area in the 4th quarter 2008. The rates include all necessary labour, materials and equipment. Allowances of 20% to cover preliminary and general items and 20% to cover contractors overheads and profit have been included in the rates which are the normal industry allowances in Karachi. It is customary to induce preliminaries and overheads in the unit rates.
Regional Variations The approximate estimating costs are based on projects in Karachi. Adjust these costs by the following factors to take account of regional variations. - Islamabad: 5 - 10% - Lahore: 0 - 5%
Construction Costs for Pakistan as at 4th Quarter 2008
Cost (Rs/ft2)
Cost (Rs/ft2) RECREATION AND ARTS BUILDINGS
INDUSTRIAL BUILDINGS Factories for letting
1,200 - 1,300
Factories for owner occupation (light industrial use)
Theatres (over 500 seats) incld. seating and stage equipment
1,500 - 1,600
Concert halls incld. seating
70,000 - 75,000/seat
Sports hall incld. changing and social facilities
Factories for owner occupation (heavy industrial use)
1,900 - 2,200
High tech laboratory workshop centers (air conditioned)
Swimming pools (school standard) incld. changing facilities
2,800 - 3,000
National museums incld. full air conditioning and standby generator
ADMINISTRATIVE AND COMMERCIAL BUILDINGS * air conditioned
Civic offices
3,600 3,000,000 each 3,000 - 4,000
RESIDENTIAL BUILDINGS 3,000
Social/economic single family housing
Offices for letting, 5 to 10 storeys
3,200 - 3,500
Offices for letting, high rise
3,500 - 3,700
Private/mass market single family housing 2 storey detached/semi detached
Offices for owner occupation, 5 to 10 storeys
3,800 - 4,000
Terraced houses
Offices for owner occupation, high rise
4,000 - 4,400
Prestige/headquarters office, 5 to 10 storeys
5,900 - 6,100
Prestige/headquarters office, high rise
6,300 - 6,600
Social/economic apartment housing - low rise (no lifts) - high rise (with lifts)
HEALTH AND EDUCATION BUILDINGS General hospitals (excld. specialist equipment and installation)
6,500 - 7,600
Private hospitals (excld. specialist equipment and installation)
7,500 - 8,700
Primary/junior schools
3,300 - 4,000
Secondary/middle schools
3,300 - 4,000
University
2,600 - 3,000
4,900
1,000 - 1,200 1,400 2,300 - 3,000 1,300 1,500
Private sector apartment building - standard specification - luxury
3,300 - 3,700 5,500 - 6,300
Student/nurses halls of residence
1,800 - 2,000
Homes for the elderly - shared - self contained with shared communal facilities
1,300 - 1,500 1,500 - 1,700
Hotel - 5 star, city center - 3 star, city/provincial Motel
11,000 - 13,000 7,000 - 8,800 3,100 - 3,700
Major Rates for Pakistan (as at 4th Quarter 2008)
Unit
Rate Rs
Excavation Mechanical excavation of foundation trenches Hardcore filling (sand) making up levels Hardcore filling (stone) making up levels
m3 m3 m3
425 825 1,170
Reinforcement Reinforcement in concrete walls, suspended concrete slabs Fabric reinforcement in concrete beds
tonne 80,000 m2 240 - 405
Steelworks Fabricate, supply and erect steel framed structure Framed structural steelwork in universal joist sections Structural steelwork lattice roof trusses
tonne
165,000
tonne tonne
165,000 165,000
Plumbing UPVC Half round eaves gutter (6” Dia.) UPVC rainwater pipes (4” Dia.) Light gauge copper cold water tubing (1/2” Dia.)
m m
4,300 2,300
m
595
m
1,235
m m
315 1,150
White vitreous china WC suite
each
14,500
White vitreous china lavatory basin Stainless steel single bowl sink and double drainer
each
8,500
each
11,700
m
1,900
High pressure plastic pipes for cold water supply (2”Dia) Low pressure plastic pipes for cold water distribution (3/4” Dia.) UPVC soil and vent pipes (3” or 4” Dia.)
Electrical Work PVC insulated and copper sheathed cable
Unit
Rate Rs
Preservative treated sawn softwood, size 50 x 100mm
m3
106,000
Single glazed casement window in hardwood, size 650 x 900mm
each
7,300
Two panel glazed door in hardwood , size 850 x 2000mm
each
14,000
Solid core half hour fire resisting hardwood internal flush doors, size 800 x 2000mm
each
15,000
Aluminium double glazed window, size 1200 x 1200m
each 14,400 - 15,200
Aluminium double glazed door, size 850 x 2100mm
each 15,500 - 17,500
Wood and metalwork
Hardwood skirtings
m
500 - 535
2 coats gypsum based plaster on concrete walls 20mm thick
m2
500
White glazed tiles on plaster walls
m2
1,290 - 1,395
Red clay quarry tiles on concrete floors
m2
900
Cement and sand screed to concrete floors, 30mm thick
m2
345 - 376
Mineral fibre tiles on concealed suspension system
m2
950
m2
600 - 700
Precast hollow concrete block walls
m2
1,130
Solid (perforated) common bricks
m2
810
Facing bricks
m2
1,350
Finishings
Glazing 6mm clear float glass; glazing to wood
Brickwork and blockwork
Concrete work
13 amp unswitched socket outlet
each
490
Plain insitu concrete (C25)
m3
6,400 - 7,745
Flush mounted 20 amp, 1 way light switch
each
350
Reinforced insitu concrete (C35)
m3
7,200 - 8,715
m2
270 - 325
Roofing Plain clay roof tiles 260 x 160mm
m2
740
Sawn softwood roof boarding (12mm)
m2
1,410
Bitumen based mastic asphalt roof covering
m2
450
Troughed galvanized steel roof cladding
m2 650 - 800
Painting Emulsion on plaster walls
m2 215 - 235
Oil paint on timber
m2 215 - 235
Formwork Softwood formwork to concrete works, concrete columns, horizontal soffits of slabs
Basic Cost of Key Materials in Pakistan (as at 4th Quarter 2008)
Unit
Cost Rs
CEMENT & AGGREGATE
Ordinary portland cement in 50kg bags tonne 6,740 825 Coarse aggregates for concrete (3/4” down) m3 3 Fine aggregates for concrete (Local Sand) m 670 Ready mixed concrete (in SR Cement) 4,400 - 1000 psi m3 3 5,400 - 3000 psi m - 3750 psi m3 5,800 6,360 - 4500 psi m3 3 7,055 - 6000 psi m 3 - 7000 psi m 8,200 3 11,000 - 9000 psi m Ready mixed concrete (in SR Cement) is on average Rs 125/m3 higher.
Unit CERAMIC TILES, STONE & MARBLE (Avg. Rate) Prime Quality Ceramic Floor & Wall Tiles - Local - China
m2 m2
450 - 550 450 - 850
Prime Quality Porcelain Floor & Wall Tiles (UAE)
m2
950 - 1,450
Polished Finish Verona Marble (Local 18mm thk)
m2
2,800 - 3,000
Polished Finish Granite (White) Flamed Finish Granite (White)
m2 m2
6,800 7,300
litre litre litre litre m2
255 150 300 300 645
m2 pc
410 220
m2 pc m2
1,000 110 550
PLASTER & PAINT
Plain steel reinforcement 10mm - 40mm dia. tonne 70,000 - 71,000 Cold-worked deformed Steel Bars, tonne 80,000 - 81,000 10mm - 40mm dia. Structural steel sections tonne 85,000 - 95,000
Plastic Emulsion paint (Matt) Distemper Paint Enamel Paint (Matt) Paint for External surface Colour crete plaster for external surface
BRICKS & BLOCKS
CEMENT TILES & PAVERS
STEEL
Hollow concrete blocks - 1200 psi (150 x 200 x 305mm) - 1200 psi (100 x 200 x 305mm) - 2000 psi (150 x 200 x 305mm) Solid concrete blocks - 1200 psi (150 x 200 x 305mm) - 1200 psi (100 x 200 x 305mm) - 3000 psi (150 x 200 x 305mm) Hollow concrete fairface blocks - 1050 psi (190 x 190 x 390mm) - 1050 psi (140 x 190 x 390mm) - 1050 psi ( 90 x 190 x 390mm) Solid concrete fairface blocks - 1050 psi (190 x 190 x 390mm) - 1050 psi (140 x 190 x 390mm) - 1050 psi ( 90 x 190 x 390mm)
TIMBER & INSULATION
Softwood sections for Formwork Hardwood for joinery (Deodar Wood) Teak plywood (Prime) Commercial plywood for joinery Formica ply sheets (Local) 100mm thick foam insulation (Jumbolon)
pc pc pc
19 17 58
pc pc pc
25 23 80
pc pc pc
38 29 23
pc pc pc
50 40 30
m3 m3 m3 m2 m2 m2
26,500 113,000 520 500 390 1,300
Cost Rs
Clay floor tiles (200 x 200mm) Kerb Stone (150 x 300 x 450) (Local) Precast concrete paving slabs (300 x 300 x 60mm) Clay roof tiles (400 x 225mm) Precast concrete roof tiles DRAINAGE
WC suite complete each 10,000 - 14,000 Lavatory basin complete each 70,000 - 80,000 100mm diameter UPVC drain pipes (Class D) m 755 150mm diameter UPVC drain pipes (Class D) m 1,635
The figures above are the cost of main construction materials, delivered to site in the urban area, as incurred by contractors in the 4th quarter 2008. These asume that the materials would be in quantities as required for a medium sized construction project and that the location of the works would be neither constrained nor remote. All estimated amounts are rounded to nearest Rs. 50.00 - 100.00
Wages of Key Personnel in Pakistan Wage rate Rs/day
CATEGORY OF WORKERS Mason/bricklayer
600.00
Carpenter
575.00
Plumber
550.00
Electrician
500.00
Aluminium Technician
500.00
Welder
550.00
Painter
500.00
Crane Operator
550.00
Pipe Fitter
500.00
Skilled Workers
600.00
Semi-Skilled Workers
450.00
Unskilled Workers
350.00 Wage rate Rs/hour
CATEGORY OF WORKERS Foreman Asphalt
75.00
Foreman Concrete
75.00
Foreman Earthwork
70.00
Supervisor
63.00
Site Engineer
125.00
Asphalt Plant Engineer
125.00
Concrete Plant Engineer
125.00
Surveyor
105.00
Assistant Surveyor
85.00
Steel Binder / Cutter
75.00
Note: Rates are as at 4th Quarter 2008 Source: Finance Department, Government of Punjab
Comparison of Daily Wages of Construction Workers in Different Cities Category of workers and cities
2005
2006
2007
2008
Islamabad
400.00
400.00
525.00
575.00
Karachi
365.00
369.00
450.00
575.00
Lahore
338.00
325.00
388.00
507.00
Peshawar
275.00
275.00
375.00
438.00
Quetta
275.00
313.00
500.00
600.00
Islamabad
400.00
400.00
525.00
575.00
Karachi
365.00
369.00
450.00
600.00
Lahore
380.00
396.00
491.00
557.00
Peshawar
325.00
325.00
442.00
475.00
Quetta
275.00
313.00
450.00
600.00
Carpenter
Mason (Raj)
Labourer (Unskilled) Islamabad
200.00
200.00
275.00
300.00
Karachi
230.00
230.00
300.00
350.00
Lahore
200.00
213.00
250.00
300.00
Peshawar
150.00
150.00
200.00
225.00
Quetta
170.00
200.00
300.00
300.00
Note: Data pertains to month of November each year (in Pak Rupees) Source: Federal Bureau of Statistics, Pakistan
Infrastructure Development (A) Roads The total length of roads in Pakistan is approximately 260,000 km. This includes 8,850 km of federalized roads, including twelve National Highway and four Motorways (M-1, M-2, M-3, & M-9). An investment of about Rs. 100 billion is earmarked for improvement of existing roads and construction of new highways and motorways during the 9th five-year plan. Work on the 1,265 km Indus Highway Project has been completed. The Indus Highway, an alternate North-South route on the west bank of river Indus, links Karachi and Peshawar through some less developed areas of the country and reduces the distance between Karachi and Peshawar by 300 km. The work on the dualisation of 1,762 km National Highway (N.5), a historic highway from Karachi to the Torkham border, through Lahore has also been completed. The construction of the Pakistan Motorway systems, connecting the northern and southern parts of the country with a link at Gawadar has been initiated. The first 333 km phase of the project, the Lahore-Islamabad Motorway M-2, has been constructed with the assistance of a South Korean firm at a cost of US$ one billion. The project has been completed now. Along this Motorway, industrial estates of 800 to 1,000 hectares at or near the interchanges are also constructed. The Islamabad-Peshawar Motorway (M-1) has also been completed.
Following are the details of some of the National Highways and Motorways:
Name M-1 M-2 M-3 M-9 N-5
N-10
N-15 N-25 N-35 N-40 N-45
The main Karakoram Highway (N-35), which is the historic silk route, is being improved, with 713 km of the road being rehabilitated under Phase-I by the Frontier Works Organization (FWO) to enhance road safety. Under Phase II, the road has been upgraded to International Standards to eventually allow faster flows of traffic from the sea ports of Karachi and Gawadar to the Central Asian States.
N-50
(B) Ports
N-75
Pakistan has two major operating Ports serving 803,943 square km of hinterland, besides offering services for land-locked Afghani-stan. The Karachi Port has 30 general cargo berths with draft of 10 to 11.5 M, and three oil jetties two of which are capable of handling 75,000 dead weight ton (DWT) ships; the third is being reconstructed to serve 75,000 DWT ships. A dedicated Container Terminal of 600 mt. quay length with draft of 11.3 m is already functioning at the West Section of the Port which is capable of handling 300,000 TEUs per annum and can accommodate 2,7000 TEU ships. The terminal is equipped with three gantry cranes, 6 RTGs and has an area of 136,000 sq. m. with a holding capacity of 8,570 TEUs. Berths 6-9 have been reconstructed and will support the establishment of a second Container Terminal at the East Section of the Port. The Port is also equipped with Two Harbor Mobile Container handling cranes that are located at the East Wharf Berths 1-4. The Port handles 18 million tons of cargo including about 7 million tons of liquid cargo. The Port has adequate covered and open transit storage areas for storage of general cargo and containers with effective security and fire fighting systems. The Port also provides buffer storage areas for export cargo, including bulk commodities for export.
N-55 N-65 N-70
Route Peshawar to Islamabad Lahore to Islambad Pindi Bhattian to Faislabad Karachi to Hyderabad Extends from Karachi to Torkham via Hyderabad, Multan, Lahore, Rawalpindi and Peshawar. Lahore Peshawar section is also known as GT or Grand Trunk Extends along the Arabian Sea Coast from Karachi to Gawadar. Also known as Makran Coastal Highway Extends from Mansehra to Chilas via Naran and Jalkhand Extends from Karachi to Quetta. Also known as RCD Highway Extends from Hasan abdal to Khunjerab. Also known as Karakoram Highway Extends from Lakpass to Taftan Extends from Nowshera to Chitral Extends from Kuchlack to Dera Ismail Khan Extends from Kotri to Peshawar. Also known as Indus Highway Extends from Sukkur to Saryab Extends from Qila Saifullah to Multan Extends from Islamabad to Kohala
Kilometers 155 367 53 136 1,819
Specification 6 lanes 6 lanes 4 lanes 4 lanes 4 lanes
653
2 lanes
240
2 lanes
813
2 lanes
806
2 lanes
610
2 lanes
309
2 lanes
531
2 lanes
1,264
4 lanes
385
2 lanes
447
2 lanes
90
2 lanes
Keeping in view the present status of the Port facilities, changes in maritime transport, and future requirements of the trade and commerce sectors, Karachi Port, with the assistance of the World Bank, has formulated and launched a comprehensive Port Modernization Plan to take care of the Traffic for the next 20 years. The other major port, Port Qasim, is located approximately 50 km south-east of Karachi and became fully operational in 1983.The approach to the port is along a 45-kilometre long Navigation Channel which provides safe navigation for vessels up to 75,000 metric tons of DWT. The Port facilities include a 1,400 m multipurpose terminal, divided into seven berths of 200 m each Berths 1-4 can accommodate vessels of up to 25,000 DWT and Berths 5-7 of up to 35,000 DWT. There is also a 279 m special berth for handling bulk iron ore and coal for Pakistan Steel. The berth is connected with the Steel Mill facility through a 4.5 m elevated conveyor. The Port also has one Oil Terminal set up by the private sector for handling liquid bulk cargoes, including fuel oil and petroleum. Port Qasim handles and annual average of 7.2 million tons of cargo, of which about 3 million tons is liquid cargo. The Port of Karachi and Port Qasim, are well served by the road and rail system, linked directly with the National Highways and rail services. Pakistan’s coastlines are over 1962 km long, stretching from Jiwani on the Pakistan-Iranian border at the western limit of the Balochistan coast and ending at the Sir Creek, formed at the Pakistan-India border on the Sindh Coast in the south-east. The coastline fronts the Arabian Sea and is adjacent to the straits of Hormuz and international shipping routes serving the Arabian Gulf region. Various studies have been conducted for potential port sites on the Balochistan Coast and a third major port is currently under construction at Gawadar, which is ideally located to attract traffic including transit and trans-shipment trade to/from the Gulf and CAR Countries. Gawadar Port Gawadar port is located at Gawadar city at the entrance of the Persian Gulf on Arabian Sea and about 460 km west of Karachi in Balochistan. It is strategically located outside the sensitive area of Strait of Hormuz but still remained on main shipping lanes. On its western side lay several hub ports of the Gulf and on eastern side Sri Lanka and Indian ports. It is bounded on the North by Kech and Awaran District and on the East by Lasbela District. These districts are mountainous and provide physical safety to Gawadar port from adverse effects of sea storms. On its south is the Arabia Sea and on West is Iran. Gawadar port is a deep-sea warm water port, being constructed in two phases with heavy investment from China. In 1993, Pakistan started technical and financial feasibilities for the development of Gawadar port. The Gawadar port project started on 22 March 2002 and the Port of Singapore Authority was hired for its management. Gawadar Port became functional on March 15, 2008, when the first ship carrying 60,000 tonnes of wheat docked, unloaded and safely sailed out from the Gawadar Port. Thus, Gawadar Port finally made history by beginning its cargo handling. It was also an important event in the sense that it was the biggest ship that had ever docked at a Pakistani port.
Gawadar Port has depth of 14.5 meters and approach channel of five kilometers. Three multi-purpose berths of 210 meters in width have been built. The port can handle bulk carriers of up to 50,000 DWT through its three berths. The federal government has declared Gawadar port as a free port for the next 20 years. Due to this fact, the Port has boosted business and trade activities at all levels in Pakistan. The second phase of Gawadar port is in progress. Phase II of the project has to be built on BOO/BOT basis at an estimated cost of US$ 524 Million will involve construction of 9 berths on BOT basis including two container berths, one bulk cargo terminal, one grain terminal with capacity to handle vessels up to 100,000 DWT, one roll on/roll off terminal, two oil piers of vessels up to 200,000 DWT and future expansion of two container berths. It is anticipated that the private sector will come forward and participate in completion of Phase II of the project. On completion of the project, Gawadar Deep-sea port would be one of the world’s most strategically located port in this part of the world.
(C) Shipping The Pakistan National Shipping Corporation (PNSC), a public sector organization. Its main objective is to serve as an operating link between major trading partners of the country, maintain and stabilize the freight rates and provide strategic link in case of emergencies. PNSC operates a fleet of 14 vessels with a total dead-weight capacity of 243,749 tonnes and also has its subsidiar-ies. PNSC is also the major carrier of crude oil for the Country. The National Tanker Company (NTC), a subsidiary of PNSC has ensured smooth transportation of about four million tonnes of crude oil for the country annually at the most economical rates, resulting in large savings in foreign exchange. It owns a Tanker having oil carrying capacity of about 80,000 tonnes. The Country’s remaining oil needs are met through chartered tankers on as required basis. The Government has issued 35 licenses to private sector companies, but so far only two companies have started up the Tri-Star Shipping Company with one tanker and the Millwall Shipping Company with only one small vessel. Although there are only two companies under the Pakistan national flag in the private sector, a number of companies are operating under flags of their own convenience. Foreign shipping lines dominate the Pakistan shipping industry. Due to small size and inadequate capacity, the national fleet is presently shipping approximately 10% of the regular cargo and 25% of the liquid bulk cargo.
(D) Air Transport Pakistan is linked to almost all the countries of the world through five international airports at Karachi, Islamabad, Lahore, Peshawar and Quetta. Karachi, the gateway to Asia, has the most modern airport of the country.
For building a strong and dependable air transport infrastructure in Pakistan, which would contribute significantly to improving the region’s logistics, the Government of Pakistan in its new National Aviation Policy has explicitly provided for the construction of new airports in the country on BOT basis. The policy also provides for an increase in private sector participation in the construction of airports. To meet the needs of domestic and international air transport, a number of private airlines have been allowed to operate alongside PIA, the national air carrier. For international operations, conditions will be developed to allow fair and reasonable competi-tion with Pakistani carriers with sufficient encouragement to the foreign airlines to continue to serve Pakistan as much as possible and in the most efficient manner. The policy also provides for selective “open skies” through agreements on the principle of reciprocity and bilateralism with the maximum number of countries. Pakistan has concluded Air Services Agreement with 91 countries. As per the new National Aviation Policy of Pakistan, a number of airlines have been granted access to the northern gateway of Pakistan, namely Lahore, Islamabad and Peshawar, effective 1st January 1999. The national airline, Pakistan International Airlines (PIA) now operates services to 45 cities in 36 countries across the four continents. It also serves over 35 cities within Pakistan. The aviation liberalization policy has also opened up investment opportunities in the privatization of airports. This will ease the burden on Civil Aviation Authority that already has enormous airport development plans and projects besides on going maintenance and upgrading of airports. Overall, the deregulation of air transport has resulted in phenom-enal growth of the sector, with domestic passenger traffic increas-ing tremendously. On the major trunk routes, in particular Karachi-Islamabad and Karachi-Lahore, lower fares have contributed to the rapid growth. In recent years, private airlines in Pakistan have flourished. Presently two private airlines, namely: Air Blue and Shaheen Air International are operating on domestic/international routes. New entrants are expected to enter the aviation market. 35 international airlines operate to Pakistan and there has been a tremendous growth on the cargo side, where the Government’s “open skies” policy for exclusive cargo flights is creating growth in this activity. In particular, with the opening of CIS states, charter operations have also increased. There is a Duty Free Shop located in the Jinnah Terminal Complex, Karachi Airport. The Duty Free Shop covers an area of 16,000 sq. ft. All outlets of Aer Rianta are in operation and their shops are full stocked and operational on a 24-hours basis.
(E) Railways Pakistan Railways has a well-developed system connecting virtually the entire country from north to south and east to west, catering to the large-scale movement of freight as well as passen-ger traffic. The Pakistan Railways Network comprises of the following: PLANT AND EQUIPMENT
UNIT
2005 - 2006
R o u te
Km
7 ,7 9 1 .0 0
7 ,7 9 1 .0 0
T ra c k
Km
1 1 ,5 1 5 .0 0
1 1 ,6 1 6 .0 0
Locomotives
No
544.00
544.00
Coaching Vehicles
No
1,663.00
1,670.00
Other Coaching Vehicles
No
214.00
246.00
Freight Wagons
No
20,809.00
19,638.00
Railway Stations
No
626.00
589.00
Passengers Carried
No
81.4 million
83.9 million
The Government of Pakistan is actively encouraging private sector participation in the railway sector to operate passenger and freight trains paying track access charges.
(F) Export Processing Zones (EPZ) The Government of Pakistan has adopted a policy package for the development of EPZs to energize the process of efficient industrial-ization and development with adequate attraction for locals and foreign investment for export oriented business ventures. There are presently four notified EPZs viz. Karachi, Sialkot, Saindak, and Risalpur and many new zones are being set up i.e. Duddar, Gujranwala, Reko Diq, Tuwarqi, Gawadar, Khalifa coastal etc.
2006 - 2007
Construction Output Benefiting from both public and private investments, the construc-tion industry of Pakistan is a prime source of employment genera-tion offering job opportunities to millions of unskilled, semi-skilled and skilled work force. The construction sector was a star performer for the fiscal year 2004-2005, against a sharp downturn of 10.7% in 2003-2004. It recorded an equally sharp upturn of 17.9% in 2006-2007. For 2007-2008, a trend of slow growth was recorded in construction industry curtailed at 15.2 % (recorded in 2007-2008) from 17.9% (recorded in 2006-2007). Hence the industry saw a decline of 2.7% through year 2007-2008. The decline in 2007-2008 was mainly caused by devaluation of Pakistan Rupees and high inflation, which was observed globally. During the last two years, the government has taken various budgetary and non-budgetary measures yielding positive results and thus Construction activity in Pakistan gathered momentum. The budget allocated for construction and transportation was increased from Rs. 6.2 billion (US$ 78.7 million) in fiscal year 2007-2008 to Rs. 6.5 billion (US$ 82.5 million) in fiscal year 20082009. More funds have been allocated to the construction industry for its betterment and growth. The sectoral share in GDP from construction industry increased from 2.5% (in 2006-2007) to 2.7% (in 2007-08). Similarly demand for construction related materials surged. Many national and international real estate developers launched different construction projects in Pakistan during the year 20072008. But after the crash of global economy, Pakistan also suffered loss in all fields as well as in construction industry. Progress in many of the mega projects slowed down or halted. Now the Government as well as private sector is taking all the necessary steps to regain the boost in the industry. The killer earthquake on 8th October 2005 in the Azad Kashmir and North-West Frontier Province (NWFP) region destroyed thousands of medical facilities, schools and residential houses. It is estimated that 2.5 million people were left homeless. It will cost billions of US dollars over the next five to ten years to rebuild the quake-affected areas in Pakistan and Azad Kashmir. Rs million
%
300,000
25.00
250,000
20.00 15.00
200,000
10.00
150,000
5.00
100,000
0.00
50,000 0 -50,000
-5.00 2000 2001 2002 2003 2004 2005 2006 2007 Construction GNP at Constant Factor Cost Construction Sectoral Share in GDP Construction Real GDP/GNP Growth Rate
-10.00 -15.00
Characteristics And Structure In 2008 there were approximately 30,500 registered constructors and 150 operators in Pakistan. Even though the number of labour force in the construction industry had increased, it is still a mere 6.56% from the overall labour force. In Pakistan no engineering works can be constructed except by a constructor, or operated except by an operator licensed as such by Pakistan Engineering Council (PEC). There are six categories of registration, which differ mainly by the limit of construction cost of project to be constructed or capital cost of project to be operated. Number of Employed Labour Force : Overall vs Construction Sector Million 60.00 50.00
Employed Labour Force Construction
40.00 30.00 20.00 10.00
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
-
Minimum Limit of Average annual Largest project Paid up capital requirement of construction value of work value during or net/capital professional cost of project for last 3 years last 3 years worth (million credit points (million rupees) (million rupees) (million rupees) rupees) (pcp-credits) Constructor’s Categories C-1 C-2 C-3 C-4 C-5 C-6
No limit Up to 100 Up to 50 Up to 20 Up to 10 Up to 5
20.00 15.00 5.00 2.00 1.40 0.50
15.00 10.00 3.75 1.50 0.75 0.38
20.00 10.00 2.50 1.00 0.50 0.25
100.00 70.00 40.00 20.00 10.00 5.00
Note: Construction cost of a project shall exclude cost of land, plant and machinery permanently installed in the works but shall include cost of erection, installation, testing and commissioning
Operator’s Categories O-1 O-2 O-3 O-4 O-5 O-6
No limit Up to 50 Up to 20 Up to 8 Up to 4 Up to 2
4.00 3.00 1.00 0.50 0.30 0.10
2.00 1.60 0.80 0.50 0.30 0.20
4.00 3.00 2.00 2.00 1.00 0.50
100.00 70.00 40.00 20.00 10.00 5.00
Note: Capital costs of projects and other values in the above table are based on the value of the operator’s fees.
Clients And Finance Public sector investment makes up a quarter of the total construc-tion investment, and the balance, by the private sector. Most of the building projects are privately funded where the financing is generally arranged through banks. Private funding is increasing due to increased privatisation of the public organizations. However, public funding financed the majority of the civil engineering and infrastructure projects.
Pakistan - An Overview
Pakistan has a strategic location, spread over a landmass of 803,940 square kilometers. Flanked by Iran and landlocked Afghanistan in the West, the central Asian Republics and China in the North and India in the South East, Pakistan boasts of significant location advantage in vast, partially tapped, potential consumer market. The affluent Gulf States are just across the Arabian Sea, providing an additional opportunity of a high consumption market. Pakistan has vast, relatively cheap land for setting up industries and other development. The average office occupation cost in the prime business districts of the big cities at less than US$ 15 per sq feet per year is much lower than other countries in the region. Pakistan is a federation of four provinces and has a parliamentary form of government. The federal government is a bicameral legislature: the lower house, the National Assembly, is elected on adult franchise basis; and the upper house, the Senate, is elected by the provincial legislatures. The provinces - Punjab, Sindh, North West Frontier and Baluchistan have unicameral legislatures with seats of Government at Lahore, Karachi, Peshawar and Quetta respectively.
Key Data GOVERNMENT Official Name Head of State Official Language National language Government type Capital city Administrative divisions
Legal system
: Islamic Republic of Pakistan : President : English /Urdu : Urdu : Federal Republic : Islamabad : 4 provinces, and 1 capital territory; 1) Sindh 2) Punjab 3) Baluchistan 4) North-West Frontier Province and 5) Islamabad Capital Territory : Based on English common law with provisions to accommodate Pakistan as an Islamic State.
GEOGRAPHY Location Total area Cultivated area Forest area Climate
POPULATION
Total population (2008 est.)
: Southern Asia, bordering the Arabian Sea, between India on the East and Afghanistan and Iran on the West and China in the North : Land - 778,720 square kilometers Water - 25,220 square kilometers : 22.99 million hectares : 4.22 million hectares : Four seasons - spring, summer, autumn, winter and monsoons during summer : 165,253,500
Province wise population and % - Sindh : 46,270,980 28.00% - Punjab : 80,974,215 49.00% - Balushidtan : 10,245,717 6.20% - NWFP : 26,440,560 16.00% - Islamabad : 1,322,028 0.80% Ethnic groups : Punjabi, Sindhi, Pastun (Pathan), Baloch, Muhajir Languages : Most of the Pakistanies are tri-lingual. They speak Urdu, English and their regional language. The percentage distribution is as follows: Urdu 95%, English 50% (can communicate) Sindhi 12%, Punjabi 48%, Siraiki 10%, Pastu 8%, Balochi 3%, Hindko 2%, Brahui 1%, Others 8% Population under 15 years Population 15 to 64 years Population 65 years and over Average annual growth rate Median age
: 37.80% : 58.00% : 4.20% : 1.99% : Total 20.5 years Male 20.3 years Female 20.6 years Life expectancy at birth (2008 estimates) - Total population : 64.13 years - Male : 63.07 years - Female : 65.25 years Literacy (Definition: age 15 and over : Total population : 49.90% Male : 63.00% can read and write) Female 36.00% (2005 estimate)
Weighted Average Lending & Deposit Rates % 18.00
LR
DR
Spread
16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 Jun-05 Aug-05 Oct-05 Dec-05 Feb-06 Apr-06 Jun-06 Aug-06 Oct-06 Dec-06 Feb-07 Apr-07 Jun-07 Aug-07 Oct-07 Dec-07 Feb-08 Apr-08 Jun-08 Aug-08 Oct-08
0.00
2007
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
Lending Rates
Deposit Rates
Spread
10.70 10.50 10.60 10.60 10.60 10.30 10.40 10.50 10.50 11.00 10.70 11.00
3.70 3.80 3.90 3.90 4.00 4.00 4.00 4.10 4.10 4.10 4.10 4.10
6.90 6.70 6.60 6.70 6.60 6.30 6.40 6.40 6.40 6.90 6.60 6.90
10.80 10.80 10.90 10.90 11.30 12.80 13.00 13.30 14.40 15.50
4.20 4.20 4.20 4.20 4.20 5.20 5.50 5.60 5.90 6.20
6.60 6.60 6.70 6.70 7.10 7.60 7.50 7.70 8.50 9.30
Source: Statistic Division, Government of Pakistan
Exchange Rates as at 1 January 2009 Country
Currency
Rs1
US $1
Australia
dollar
0.0184
1.4437
Bahrain
dinar
0.0048
0.3780
Brunei
dollar
0.0186
1.4622
China
rmb
0.0874
6.8533
Egypt
pound
0.0718
5.6304
ecu
0.0091
0.7123
dollar
0.0988
7.7508
India
rupees
0.6362
49.900
Indonesia
rupiah
142.934
11,210.8
Japan
yen
1.1533
90.459
Kenya
shillings
1.0014
78.543
Lebanon
pound
19.4799
1,527.9
Malaysia
ringgit
0.0448
3.5146
New Zealand
dollar
0.0220
1.7283
Pakistan
rupee
1.0000
79.066
Philippines
peso
0.6110
47.920
Qatar
riyal
0.0465
3.6488
Russia
rubles
0.3829
30.029
Singapore
dollar
0.0184
1.4391
South Africa
rand
0.1197
9.3903
South Korea
won
16.2707
1,276.16
Thailand
baht
0.4486
35.183
United Arab Emirates
dirham
0.0469
3.6746
United Kingdom
pound
0.0086
0.6811
United States of America
dollar
0.0128
1.0000
European Currency Unit Hong Kong
Source: www.oanda.com/convert/classic
Currency Chart Rupee 160.00 140.00 120.00 100.00 80.00 60.00 40.00 20.00 0.00 99
00
01 Rs per 1 USD Rs per 1 SGD
02
03
04 Rs per 1 GBP Rs per 1 EURO
05
06
07 Rs per 100 JPY Rs per 1 RM
08
Year
POPULATION (cont’d) Population below poverty line Labour force Employed Unemployed Unemployment Rate (2007 est.) Labour force by occupation - Agriculture sector - Construction industry sector - Services sector - Manufacturing and mining - Others Religions
: 24% (2008 estimate) : 50.78 million : 48.07 million : 3.10 million : 7.50% + substantial under employment : 43.62% : 6.56% : 14.41% : 13.54% : 21.86% : Muslim 95% (Sunni 75% , Shi’a 20% ) Christian, Hindu and others 5%
ECONOMY Monetary unit Exchange rate to: (20 Dec 2008) the pound sterling the US dollar Euro UAE Dirham Average annual real inflation Inflation rate (Jul - Nov 2008) GDP growth rate Gross Domestic Product (GDP) at market price GDP per capita (PPP) Average annual real change in GDP GDP composition by sector Remittance (2007 - 2008)
: Pak – Rupee (Rs) : Rs 119.06 : Rs 78.90 : Rs 109.17 : Rs 21.45 : 12.00% : 24.70% : 5.78% : US$ 167.00 billion : US$ 2,400.00 : 5.87% : Agriculture 20.90%, Services 53.20%, Construction Industry 2.70%, Manufacturing 18.90%, Others 4.40% : US$6.45 billion (+17.5%)
TRADES Total Exports (2007 - 2008) Major exports commodities
: US$20.13 billion : Textiles, rice, leather goods, sports goods, chemicals, manufactures, carpets and rugs Export partners (Jul 08 - Aug 08): USA 18.41%, UAE 8.85%, Afghanistan 8.16%, , China 3.96%, UK 4.89% Imports (2007 - 2008) : US$35.41 billion Imports commodities : Petroleum and petroleum products, machinery, chemicals, transportation equipment, edible oils, pulses, iron and steel, tea Import partners : UAE, Saudi Arabia, Kuwait, USA, Malaysia International Airports : Karachi, Lahore, Islamabad, Peshawar and Quetta Major Sea ports : International -Karachi, Port Bin Qassim : Domestic - Minora, Gawadar and Pasni
CONSTRUCTION Net Value of construction output as a proportion of GDP GNP at Current Factor Cost
: 2.70% : Rs 277,141 m
Construction sector growth : 15.20% Net Inflow of FDI (Construction) : US$ 88.5 million (2007 - 2008) US$ 18.1 million (2008 - 2009) Cement production (2008) : 8.75 million tonnes
Economy Pakistan’s economy continues to show resilience to domestic and international shocks of extraordinary nature during the out going fiscal year. Although these have taken their toll, the economy is expected to turn in a reasonable growth performance during fiscal year 2008-2009, albeit substantially lower than target. However, growing macroeconomic imbalances, particularly the widening fiscal and current account deficits continued to create complications and add to inflationary pressures. On the other hand, Pakistan has largely been less affected by the continuing turmoil in the international credit markets. Pakistan’s economy has grown at an average rate of almost 6.6% per annum during the last five years. Its GDP grew by 5.8% in 2007-2008 against 6.8% last year and growth target of 7.2%. Agriculture sector showed dismal performance and grew by 1.5% against 3.7% last year and target of 4.8%. Manufacturing, account-ing for 18.9% of GDP registered a modest growth of 5.4% against 8.2% last year. Agriculture remains the dominant source of employ-ment. The share of agriculture in employment increased from 43% in 2003-2004 to 43.61% by the year 20062007, with manufactur-ing (13.54%) and trade(14.43%) & services(14.41%) absorbing a growing share of the work force. Pakistan’s export performance has been impressive in recent years (2002-2003 to 2005-2006) with exports registering an average growth of 16 percent per annum. Pakistan’s export performance was however dismal in 2006-2007, witnessing abrupt and sharp deceleration to less than 4 percent. The SBP continued pursuing a relatively easy monetary policy since 2002 to induce banks to reduce the lending rates in order to providing low cost credit to private sector with the view of promoting investment and growth. However, with recent monetary devaluation, rising fuel prices and its global effects, SBP has increased the lending rates to 15% effective 4th Quarter 2008.
Comparative Performance of Key Economic Indicators Unit GDP Growth % Weighted Ave. Lending Rates % Construction Growth % Inflation % Exchange Rate Rs/US$ Stock exchange index (KSE) FDI US$ millions
2003-4
2004-5
2005-6
2006-7
2007-8
7.50 8.60 6.60 7.00 5.80 5.05 8.00 9.60 10.68 12.02 -10.70 18.60 5.70 17.90 15.20 3.90 9.30 7.90 7.90 12.00 57.92 59.66 60.00 60.91 78.90 5,279 7,450 9,989 9,801 12,289 949.40 1,524.00 3,521.00 4,160.00 5,152.00
Investment Policies And Incentives The current Pakistan Government has adopted the following liberal investment policy: All economic sectors open to FDI Equal treatment to local and foreign investors 100% foreign equity allowed No government sanction required Attractive tax/tariff incentives package Remittance of royalty, technical and franchise fee, capital, profits and dividends allowed Foreign investment fully protected by Foreign Private Investment (Promotion & Protection) Act 1976, Protection of Economic Reforms Act, 1992 and Foreign Currency Accounts (Protection) Ordinance, 2001 Bilateral Agreements - Investment protection with 46 countries and Avoidance of Double Taxation with 52 countries Non Manufacturing Sectors Policy Parameters
Manufacturing Sector
Agriculture
Infrastructure IT & Telecom Services & Social Social
Not required except for 4 specific industries i.e. arms and ammunitions, high explosives, radioactive substances and security printing currency and mint
Not required except specific licenses from concerned agencies
Remittance of capital, profits, dividends, etc
Allowed
Allowed
Upper limit of foreign equity allowed
100%
Minimum investment amount
No
Government Permission
Custom duty on import of Plant, Machinery and Equipment
5%
Tax relief (Initial depreciation allowance, % of Plant, Machinery and Equipment)
50%
Royalty & Technical Fee
No restriction for payment of royalty & technical fee
100% USD 0.3m 0%
100%
100%
USD 0.3m
USD 0.15m
5%
0-5%
50% Allowed as per guidelines – initial lump sum up to USD100,000 -Max rate 5% of net sales – initial period 5 years
The housing and construction sector was declared as industry in 1994. Plant, Machine and Equipment, not manufactured locally, of housing and construction industry are importable at custom duty of 5.0% and Zero rates sales tax. To encourage investment in this sector, excise duty on paints was abolished, and import duties on a number of building materials, including steel and its products and construction machinery reduced. Sales tax and withholding tax on construction machinery were also abolished.
The Government is undertaking a major effort to remove ambigui-ties in urban land titles, to provide certainties in the real estate market. Local and foreign companies involved in real estate projects will only market those whereby the property title is transferred in the name of a locally incorporated company, and the “Commencement of Business” certificate issued by the Security & Exchange Commission of Pakistan to the firm. Plant, Machine and Equipment - not manufactured locally - of tourism, hotels and related projects are also importable at custom duty of 5.0% and Zero rates sales tax.
Tariff Manufacturing/Industrial Sector
Custom duty levied on imports of plant, machinery and equipment
Custom duty
Sales tax
5.00%
0.00%
0.00 - 5.00%
0.00%
Other Sectors (Non Manufacturing)
Imported of plant, machinery and equipment (not manufactured locally)
Fiscal Incentives To keep Pakistan competitive in international markets and support the viability of investments in the country, the following incentives are available to both foreign and local investors.
Personal Income Tax Rates Salaried Taxpayers
A) Initial Depreciation Allowance (IDA)
Up to Rs. 180,000
0.00
Rs. 180,001 - 200,000
0.50
Rs. 200,001 - 250,000
0.50
Rs. 250,001 - 350,000
0.75
Rs. 350,001 - 400,000
1.50
Rs. 400,001 - 450,000
2.50
Rs. 450,001 - 550,000
3.50
Rs. 550,001 - 650,000
4.50
Rs. 650,001 - 750,000
6.00
Rs. 750,001 - 900,000
7.50
Rs. 900,001 - 1,050,000
9.00
IDA at rate of 50% is permissible on an “eligible depreciable asset” placed in service in Pakistan for the first time in a tax year. “Eligible depreciable asset” means plant and machinery excluding any road transport vehicle unless the vehicle is plying for hire; any furniture including fittings; any plant or machinery that is required second hand; and any plant or machinery in relation to which the deduction has been allowed under other section of the New Ordinance for the entire cost of the asset in the tax year in which the asset is acquired. B) Amortization 1) Amortization of pre-commencement expenses allowed at the rate of 20% annually
Taxable Income
Rate of Tax (%)
Rs. 1,050,001 - 1,200,000
10.00
Rs. 1,200,001 - 1,450,000
11.00
2) Amortization of intangible assets allowed over a period of ten year.
Rs. 1,450,001 - 1,700,000
12.50
Rs. 1,700,001 - 1,950,000
14.00
Normal Tax Rates
Rs. 1,950,001 - 2,250,000
15.00
Rs. 2,250,001 - 2,850,000
16.00
Rs. 2,850,001 - 3,550,000
17.50
Rs. 3,550,001 - 4,550,000
18.50
Rs. 4,550,001 - 8,650,000
19.00
Over Rs. 8,650,000
20.00
Company Tax Rates Banking Companies Public Companies Private Companies Small Companies having: 1) Paid up capital of Rs 25 mil 2) Turnover of Rs 200 mil 3) Incorporated after July 1, 2005 Private Companies Source: Central Board of Revenue, Pakistan
Tax Rate 35% 35% 35% 20%
Non Salaried Taxpayers Taxable Income
25%
Rate of Tax (%)
Up to Rs. 100,000
0.00
Rs. 100,000 - 110,000
0.50
Rs. 110,001 - 125,000
1.00
Rs. 125,001 - 150,000
2.00
Rs. 150,001 - 175,000
3.00
Rs. 175,001 - 200,000
4.00
Rs. 200,001 - 300,000
5.00
Rs. 300,001 - 400,000
7.50
Rs. 400,001 - 500,000
10.00
Rs. 500,001 - 600,000
12.50
Rs. 600,001 - 800,000
15.00
Rs. 800,001 - 1,000,000
17.50
Rs. 1,000,001 - 1,300,000
21.00
Over Rs. 1,300,001
25.00
Facilitation Exchange Control a) Full repatriation of capital, capital gains, dividends and profits is allowed. b) The facility for contracting foreign private loans (which does not involve any Guarantee from the Government of Pakistan) is available to all those foreign investors, who make investment sectors open to foreign investment, for financing the cost of imported plant and machinery required for setting up the project. However, loan agreement should be registered/ cleared by the State Bank of Pakistan. c) Foreign controlled manufacturing concerns will be allowed unlimited domestic borrowing according to their requirements for working capital. d) Authorized dealers are authorized to grant rupee loans and credits to foreign controlled companies for meeting their working capital requirements subject to observance of Prudential regulations prescribed under the Banking Companies.
Pakistan Value of Foreign Trade (in million rupee) Year / Month
Exports
2001-02
ReExports
Imports
ReImports
Balance of Trade
560,946.70 4,306.90
634,630.30
688.50
-70,065.20
2002-03
652,293.80 2,943.50
714,371.90
342.00
-59,476.60
2003-04
709,036.10 24,024.80
897,824.60
819.00
-165,582.70
2004-05
854,087.70 6,076.70 1,223,079.10 4,729.10
-367,643.80
2005-06
984,840.60 7,717.00 1,711,158.40
613.70
-719,214.50
2006-07 1,029,311.67 9,726.10 1,851,805.91
232.00
-813,000.23
2007-08 1,196,637.60 45,527.60 2,512,071.70
690.80 -1,270,597.30
2007 Jul
88,878.90
N/A
155,454.10
N/A
N/A
Aug
88,627.20
756.50
166,257.70
30.60
-76,904.50
Sep
90,014.10
527.00 1,658,343.90
26.30
-75,320.10
Oct
83,626.00 1,889.20
205,383.90
24.20
-119,912.90
Nov
93,891.20 25,317.90
192,838.60
44.50
-73,674.00
Dec
80,771.50
833.60
143,699.70
84.40
-62,179.00
2008 Jan
91,319.70
765.40
220,097.10
27.10
-128,039.10
96,314.70 1,053.40
229,052.50
80.60
-131,765.00
Feb Mar
111,168.90
928.30
239,805.00
105.10
-127,812.90
Apr
113,816.00 1,127.10
260,569.70
5.50
-145,632.10
May
129,846.90 1,725.20
262,450.30
104.90
-130,983.10
Jun
128,362.60 9,755.60
270,628.20
94.80
-132,604.80
Jul
132,665.00 1,838.00
250,512.60
73.40
-116,083.00
Aug
116,196.30 1,488.90
257,011.90
174.20
-139,500.90
Source: Statistic Division, Government of Pakistan
Yearly Inflation Rates Inflation Rates based on Sensitive Price Indicator (SPI), Consumer Price Index (CPI) and Wholesale Price Index (WPI)
Period
SPI 12.6
2006-07*
WPI
2004-05
CPI
2000-01
1998-99
1996-97
1994-95
1992-93
1990-91
SPI
2002-03
% 20.00 18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00
CPI
WPI 11.7 9.8
1990-91 1991-92
10.5
12.7 10.6
1992-93
10.7
9.8
7.4
1993-94
11.1
11.3
16.4
1994-95
15.0
13.0
16.0
1995-96
10.7
10.8
11.1
1996-97
12.5
11.8
13.0
1997-98
7.4
7.8
6.6
1998-99
6.4
5.7
6.4
1999-00
1.8
3.6
1.8
2000-01
4.8
4.4
6.2
2001-02
3.4
3.5
2.1
2002-03
3.6
3.1
5.9
2003-04
6.8
4.6
7.9
2004-05
11.6
9.3
6.8
2005-06
7.0
7.9
10.1
2006-07 2007-08
10.8 16.8
7.7 12.0
6.9 16.4
Note: Base Year = 2000-01 Source: Statistic Division, Government of Pakistan
Useful Websites (Pakistan) Board of Investment
www.pakboi.gov.pk
National Reconstruction Bureau
www.nrb.gov.pk
Capital Territory Police Islamabad
www.cybercity-online.net
Central Board of Revenue
www.cbr.gov.pk
Pakistan Agricultural Research Council
www.parc.gov.pk
Chamber of Commerce & Industry - Federation of Pakistan
www.fpcci.gov.pk
- Islamabad
Pakistan Broadcasting Corporation Pakistan Computer Bureau
www.radio.gov.pk www.pcb.gov.pk
www.icci.org.pk
Pakistan Council of Architects & Town Planners
www.pcatp.org.pk
- Karachi
www.karachichamber.com
Pakistan Engineering Council
www.pec.org.pk
- Lahore
www.lcci.org.pk
Pakistan Housing Authority
www.pha.gov.pk
- Sarhad
www.scci.org.pk
www.picic.com
Export Processing Zones Authority Pakistan
Pakistan Industrial Credit & Investment Corporation
www.epza.com.pk
Pakistan International Airline
www.piac.com.pk
Federal Bureau of Statistic
www.statpak.gov.pk
www.un.org.pk
Government of Punjab
www.punjab.gov.pk
Pakistan National Commission for UNESCO
Government of Sindh Ministry of Information Technology
www.sindh.gov.pk
Pakistan National Shipping Corporation
www.pnsc.com.pk
Pakistan Post Office
www.pakpost.gov.pk
Pakistan Railways
www.pakrail.com
Pakistan Software Export Board Pakistan Telecommunication Authority
www.pseb.org.pk www.pta.gov.pk
Pakistan Television Corporation
ptv.com.pk
Pakistan Tourism Development Corporation
www.tourism.gov.pk
Pakistan Trade Office
www.engineeringpakistan.com
Privatization Commission
www.privatisation.gov.pk www.pamco.bz
Institute of Regional Studies
www.moit.gov.pk www.irs.org.pk
Islamic Republic of Pakistan
www.pakistan.gov.pk
Karachi Building Control Authorities Karachi International Container Terminal
www.kbca.gov.pk
Karachi Port Trust
www.kpt.gov.pk
Ministry of Commerce
www.commerce.gov.pk
Ministry of Environment
www.environment.gov.pk
Ministry of Environment, Local Government & Rural Development
www.environment.gov.pk
Punjab Agriculture Marketing, Govt. of Punjab
Ministry of Finance
www.finance.gov.pk
Securities and Exchange Commission of Pakistan
www.secp.gov.pk
Ministry of Foreign Affairs Ministry of Industries & Production
www.mofa.gov.pk
Silakot Chamber of Commerce & Industry
www.home.scci.org.pk
Small & Medium Enterprise Devt. Authority
www.smeda.org
State Bank of Pakistan
www.sbp.org.pk
Trade Development Authority of Pakistan
www.tdap.gov.pk
www.kictl.com
www.moip.gov.pk
Ministry of Petroleum & Natural Resources
www.mpnr.gov.pk
Ministry of Science & Technology
www.most.gov.pk
Competition Commission of Pakistan
www.mca.gov.pk
National Database and Regulation Authority (NADRA)
www.nadra.gov.pk
Quality Policy Statement Our policy and goal is to fill the company’s culture with committed, dedicated and excellent people having in-depth knowledge in the Quantity Surveying field who will play a positive and creative role in realising the needs and expectations of our clients and to continually strive to ensure that our clients have the best service available. Each process within the Company that determines the quality of our services shall be managed and controlled in a planned and systematic manner in accordance with our quality system documents with the highest integrity, impartiality and independency. We see our quality system as a valuable tool and mechanism to promote, instill, further develop and bring about opportunities for improvement to our staff and our internal processes. Essential to an effective quality system is our belief in continuous investment in professional development and structured training of our staff at all levels in core skills and knowledge. All staff members are required to comply with this policy statement, be responsible for the quality of their work and for providing our clients with a consistently high standard of service.
Alan P. Hearn President
VISSION MISSION STATEMENT Davis Langdon and Seah Philippines Inc. Vision To be the leading Cost and Quantity Surveying, Environmental Sustainability and Development Management Consultant in the Philippines built environment providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects - integrating and coordinating each of our business lines. Cost and Quantity Surveying Vision To be the leading Cost and Quantity Surveying Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Cost and Quantity Surveying Consultancy with our other service lines of Environmental Sustainability and Development Management. Mission Protecting the interests of our Clients, we commit to: • Provide our Clients with proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. • Provide our Clients accurate and dependable services taking into account their needs and procurement options.Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Cost Consultancy and Quantity Surveying services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Maintaining and upholding our Chartered status with the RICS. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. • Producing marketing materials and marketing strategy to diversify and widen our client base on Cost Consultancy and Quantity Surveying services. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Environmental Sustainability Vision To be the leading Environmental Sustainability Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Environmental Sustainability Consultancy with our other service lines of Development Management, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide LEED, BERDE and BREAM accreditation consultancy services and expanding this to a capability in other S.E. Asian accreditation systems such as Greenmark (Singapore). • Provide our Clients with a proactive, integrated service guiding them through the accreditation process and educating key parties where there is lack of past experience/familiarization with the process. • Provide our Clients with service over and above their requirements by achieving the project’s targeted sustainability certification, striving to go beyond the project’s pursued level within a reasonable cost and time. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a remuneration package that exceeds the highest local benchmark competitors. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation, specialization seminars and qualifications in the field of environmental sustainability consultancy services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Developing the company as the foremost energy modeling center in the region, well-versed over a range of accredited software; that clients and other DLS companies in S.E. Asia might refer for modeling services. • Expanding our Consultancy Services into other related fields such as carbon assessment, daylight simulation and commissioning works. • Developing our Consultancy Services to increase our involvement in the existing built environment as well as new build developments. • Producing marketing materials and marketing strategy to diversify and widen our Client base on Environmental Sustainability Consultancy. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Development Management Vision To be the leading Development Management Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Development Management Consultancy with our other service lines of Environmental Sustainability, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide a high level Client’s Representative service incorporating strategic procurement advice, project management, planning, risk avoidance and programming services. • Provide our Clients with a proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Guide our Clients through the development process and educating key parties where there is lack of past experience/ familiarization with the process. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Development Management services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Producing marketing materials and marketing strategy to diversify and widen our client base on Development Management services. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
VISSION MISSION STATEMENT Davis Langdon and Seah Philippines Inc. Vision To be the leading Cost and Quantity Surveying, Environmental Sustainability and Development Management Consultant in the Philippines built environment providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects - integrating and coordinating each of our business lines. Cost and Quantity Surveying Vision To be the leading Cost and Quantity Surveying Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Cost and Quantity Surveying Consultancy with our other service lines of Environmental Sustainability and Development Management. Mission Protecting the interests of our Clients, we commit to: • Provide our Clients with proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. • Provide our Clients accurate and dependable services taking into account their needs and procurement options.Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Cost Consultancy and Quantity Surveying services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Maintaining and upholding our Chartered status with the RICS. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. • Producing marketing materials and marketing strategy to diversify and widen our client base on Cost Consultancy and Quantity Surveying services. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Environmental Sustainability Vision To be the leading Environmental Sustainability Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Environmental Sustainability Consultancy with our other service lines of Development Management, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide LEED, BERDE and BREAM accreditation consultancy services and expanding this to a capability in other S.E. Asian accreditation systems such as Greenmark (Singapore). • Provide our Clients with a proactive, integrated service guiding them through the accreditation process and educating key parties where there is lack of past experience/familiarization with the process. • Provide our Clients with service over and above their requirements by achieving the project’s targeted sustainability certification, striving to go beyond the project’s pursued level within a reasonable cost and time. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a remuneration package that exceeds the highest local benchmark competitors. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation, specialization seminars and qualifications in the field of environmental sustainability consultancy services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Developing the company as the foremost energy modeling center in the region, well-versed over a range of accredited software; that clients and other DLS companies in S.E. Asia might refer for modeling services. • Expanding our Consultancy Services into other related fields such as carbon assessment, daylight simulation and commissioning works. • Developing our Consultancy Services to increase our involvement in the existing built environment as well as new build developments. • Producing marketing materials and marketing strategy to diversify and widen our Client base on Environmental Sustainability Consultancy. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Development Management Vision To be the leading Development Management Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Development Management Consultancy with our other service lines of Environmental Sustainability, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide a high level Client’s Representative service incorporating strategic procurement advice, project management, planning, risk avoidance and programming services. • Provide our Clients with a proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Guide our Clients through the development process and educating key parties where there is lack of past experience/ familiarization with the process. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Development Management services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Producing marketing materials and marketing strategy to diversify and widen our client base on Development Management services. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
CONSTRUCTION COSTS FOR PHILIPPINES PESO/m2 DESCRIPTION
BUILDING
TOTAL SERVICES
TOTAL
DOMESTIC
Average standard apartments, high rise Luxury apartments, high rise Town houses Individual prestige houses
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping Centers
HOTELS
Resort hotels, inclusive of F.F.&E 3-star budget hotels inclusive of F.F.&E 5-star luxury hotels inclusive of F.F.&E
INDUSTRIAL
Owner operated factories, low rise
OTHERS
Carparks, above ground General hospitals
27,100 33,100 21,300 40,700
6,800 9,500 2,700 7,900
- 9,500 - 14,700 - 4,600 - 12,150
-
29,200 34,900 24,700 43,350
22,050 30,750 30,000 -
25,800 32,600 31,800
9,450 - 13,300 13,150 - 16,400 8,100 - 13,400
31,500 - 39,100 43,900 - 49,000 38,100 - 45,200
36,750 35,450 49,750 -
49,050 42,400 51,700
11,350 - 13,950 12,400 - 15,350 14,250 - 22,300
48,100 - 63,000 47,850 - 57,750 64,000 - 74,000
12,300 -
13,850
13,750 36,400 -
17,700 39,600
3,950 -
33,900 42,600 24,000 48,600
-
38,700 49,600 29,300 55,500
6,900
16,250 - 20,750
3,350 - 5,200 12,600 - 20,350
17,100 - 22,900 49,000 - 59,950
Costs are at 4th Quarter 2011 levels. Manila building costs are expected to increase by approximately 0.5% per month (compounded) during 2012.
M & E SERVICES COSTS FOR PHILIPPINES PESO/m2 DESCRIPTION
TOTAL SERVICES
FIRE LIFTS / PLUMBING ELECTRICAL MECHANICAL SERVICES SERVICES ESCALATOR SERVICES SERVICES
DOMESTIC
Average standard apartments, high rise Luxury apartments, high rise Town houses Individual prestige houses
6,800 - 9,500 9,500 - 14,700 2,700 - 4,600 7,900 - 12,150
3,600 3,900 1,400 3,000 -
4,300 400 - 900 6,300 2,100 - 3,000 1,800 600 - 1,300 5,500 2,500 - 2,950
600 - 900 700 - 1,300 -
800 - 1,500 1,400 - 1,900 800 - 1,500 2,000 - 2,600 700 - 1,500 2,400 - 3,700
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping Centers
9,450 - 13,300 3,300 - 4,700 3,000 - 3,300 13,150 - 16,400 4,800 - 6,000 4,000 - 6,000 8,100 - 13,400 3,600 - 6,000 2,500 - 3,700
650 - 900 1,600 - 2,200 900 - 1,500 650 - 1,200 2,200 - 2,900 1,500 - 2,000 650 - 900 700 - 1,700 650 - 1,100
11,300 - 13,950 4,400 - 5,200 3,000 - 3,300 12,400 - 15,350 4,700 - 5,500 3,300 - 4,000 14,250 - 20,950 5,400 - 8,400 4,000 - 6,000
650 - 950 650 - 950 650 - 1,100
HOTELS
Resort hotel, inclusive of F.F.&E. 3-star budget hotels inclusive of F.F.&E. 5-star luxury hotels inclusive of F.F.&E
1,500 - 2,000 1,800 - 2,500 1,800 - 2,300 2,000 - 2,700 1,800 - 3,000 2,400 - 3,800
INDUSTRIAL
Owner operated factories, low rise
3,900 - 6,650 2,000 - 3,500
650 - 1,300
600 - 900
3,250 - 5,000 1,100 - 1,650 12,600 - 20,150 5,000 - 7,700
100 - 200 4,200 - 6,500
550 - 750 750 - 1,500
-
700 - 1,200
OTHERS
Ccarparks, above ground General hospitals Costs are at 4th Quarter 2011 levels.
1,100 - 1,700 500 - 900 900 - 1,800 1,750 - 3,900
CONSTRUCTION VALUE Construction Value (Php Billions)
120 105 Residential
90
Non-Residential
75 60 45 30 15 0
2002
2003 2004
2005
2006
2007
2008
2009
2010 2011*
Year
Construction Value Php (1,000) Year Residential
2005 2006 2007 2008 2009 2010 2011*
51,454,973 51,179,051 53,596,319 69,043,520 77,953,836 97,247,194 102,938,618
Non-Residential
33,560,552 50,772,217 53,240,552 50,718,172 48,895,248 79,047,539 94,679,492
* Forecast Source : www.census.gov.ph/data/sector data
CONSTRUCTION ACTIVITY Usable Floor Area (Millions m2) 14 12
Residential Non-Residential
10 8 6 4 2 0 2002
2003
2004 2005
2006
2007
2008
2009 2010 2011*
Year
Usable Floor Area (m2) Year Residential
2005 2006 2007 2008 2009 2010 2011*
8,460,337 7,808,050 7,740,142 9,305,281 9,848,587 11,412,345 11,291,568
Non-Residential
5,234,044 6,024,889 7,028,643 6,310,071 5,355,568 8,820,354 8,716,240
* Forecast Source : www.census.gov.ph/data/sector data
LEAD TIME OF DIFFERENT PACKAGES Process Code* (in weeks)
Process Code* (in weeks) Packages
A
B
C
D
Packages
A
B
C
D
Passenger lifts (non-standard)
8
3
-
27
Escalators
4
2
-
18
Mechanical pipework
4
2
1
1
Ductwork
4
2
4
3
Sprinklers
6
2
4
3
2
2
3
6
Insitu Concrete Works
1
Structural steel frames
4
2
-
5
Claddingcurtain walling
10
2
-
14
Brickwork
1
1
2
-
Roof finishes profiled metal
3
1
4
4
Air-conditioning plant
Windows
2
6
Variable airvolume unit
1
1
3
6
Electrical package
6
3
-
-
Switchgear Generators (600 kW)
2
2
-
10
4
2
-
13
Light fittings Security systems
1 3
1 3
6 4
-
Controls
4
3
3
-
Furniture
2
2
4
8
Data and voice cabling
3
2
1
1
2
3
-
Drylining, plaster and screeds
1
1
1
-
Demountable partitions
2
1
2
3
General joinery
2
2
3
5
Raised floors
2
2
-
-
Suspended Decorations (wall coverings) Stone wall and floor finishes
2
2
3
3
-
-
2
-
3
2
4
5
* Process Code Legend: A - Working Drawing B - Approve working drwing C - Procurement of materials D - Manufacture The lead time provided shall serve only as guide for use in projects, this is due mainly to the variability of factors like local customs processing/clearing, material availabilirt, among others. Lead times do not refer to any particular building/project type and are based on average times. For examples; Air-conditioning plant may require between six and twelve weeks depending on the plant specified or required. Therefore, an average of nine weeks has been used in the table.
-
ESTIMATING RULES OF THUMB Densities of Common Materials Concrete Cement Sand Gravel Steel
2,400 kg/m3 1,441 kg/m3 1,600 kg/m3 1,350 kg/m3 7,850 kg/m3
Structure Design - Concrete Ratios
Water Softwood Hardwood Aluminum Soil (compact)
1,000 kg/m3 700 kg/m3 1,100 kg/m3 2,750 kg/m3 2,100 kg/m3
Concrete/floor area Formwork/floor area Reinforcement
0.4 m3/m2 2.0 m2/m2 180 kg/m3
to 0.55 m3/m2 to 3.0 m2/m2 to 280 kg/m3
Average External Wall/Floor Ratio
Concrete
Minimum Recommended Cement Factor Based on Concrete Strength ( in bags of 40 kg cement) Strength Psi Mpa
Ordinary Design Mix 1 1/2” Gravel Size 3/4”
8,000 7,000 6,000 5,000 4,000 3,000
21 19 17 15 11.75 9
55 48 41 35 28 21
22 20 18 16 12.75 10
Pumpcrete Design Gravel Size 3/4” 23 21 19 17 14.5 11.5
Reinforcement
Bar Diameter (mm) 6 8 10 12 16 20 25 32 40
The following is a range of concrete ratios for building superstructure design in Manila:
Weight/m (kg/m)
Perimeter (mm)
Area (mm2)
0.222 0.395 0.616 0.888 1.579 2.466 3.854 6.313 9.864
18.85 25.13 31.42 37.70 50.27 62.83 78.54 100.53 125.66
28.27 50.26 78.54 113.10 201.06 314.16 490.88 804.25 1256.64
Residential Apartments Office, Hotel Industrial
1.0 m2/m2 0.4 m2/m2 0.4 m2/m2
Average Internal Wall/Floor Ratio
Residential Apartments Office Hotel
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
Dimensions for standard parking space, loading/unloading bays and lay-bys
Private Cars, Taxis and Light Vans Coaches and Buses Lorries Container Vehicles
Length (m)
Width (m)
Headroom (m)
5 12 11 16
2.5 3.0 3.5 3.5
2.4 3.8 4.1 4.5
Minimum heandroom means the clearance between the floor and the lower most projection from the ceiling including any lightings units, ventilation duct, conduits or similar. The above ratios are indicative and for reference purpose only. They do not account for buildings with special shapes, configurations or particularly small foot prints. Average Loads
Lorry (24 ton) Concrete truck (24 ton)
Volume
10.0 m 3 5.5 m 3
CONSTRUCTION MATERIALS WHOLESALE PRICE INDEX IN THE NATIONAL CAPITAL REGION (NCR) Base Year (2000 = 100) 2011
2010 Dec
Jan
Feb
Mar
ALL ITEMS
197.0
199.4
201.8
A. Sand and gravel
171.7
171.1
B. Concrete Products
183.8
C. Cement
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
206.6
210.5
210.8
211.4
212.0
211.7
212.3
212.2
213.7
171.4
174.2
178.7
181.8
182.2
184.5
185.8
181.8
182.2
190.0
185.1
186.6
189.7
193.8
194.0
194.8
195.5
195.5
195.9
195.9
195.9
182.9
183.2
183.3
183.7
184.1
178.6
179.2
177.9
176.0
177.9
177.0
177.2
D. Hardware
194.5
195.2
195.2
197.5
201.2
203.9
206.0
205.9
205.8
205.8
205.8
206.5
E. Plywood
157.3
157.9
161.1
165.1
168.8
170.9
171.3
172.3
173.3
172.2
172.2
174.5
F. Lumber
202.3
203.0
204.8
210.7
213.6
217.1
217.1
217.2
216.3
217.2
217.2
218.2
G. G.I. Sheet
172.9
172.9
172.9
173.5
173.6
173.6
173.6
173.6
173.5
173.6
173.6
173.5
H. Reinforcing Steel
220.1
221.1
225.1
230.7
234.4
235.8
238.9
238.9
239.0
238.2
238.2
242.6
I. Structural Steel
246.0
246.2
251.0
253.8
257.4
262.1
264.7
266.8
265.8
266.0
266.0
267.7
J. Tile Works
159.9
160.7
162.4
162.6
163.5
164.4
165.1
166.3
167.5
169.4
169.4
169.4
K. Glass and Glass Products
174.6
174.6
174.6
176.0
177.7
177.7
177.7
177.7
177.7
177.7
177.7
177.7
L. Door, Jambs and Steel Casement
180.6
181.1
184.5
189.3
190.4
190.5
190.5
190.5
190.4
190.4
190.4
191.6
M. Electrical Works
171.3
171.5
174.0
177.2
180.6
183.9
184.0
184.9
185.3
187.1
187.4
187.4
N. Plumbing Fixtures & Accessories/Waterworks
146.9
147.3
148.8
150.0
152.4
154.5
154.5
154.5
154.5
154.5
154.5
154.3
O. Painting Works
185.1
185.8
186.8
189.5
190.4
193.0
193.4
193.6
195.3
195.3
195.5
196.5
P. PVC Pipes
165.3
166.0
166.0
166.8
166.8
168.8
168.8
168.8
169.5
169.5
169.5
170.2
Q. Fuel and Lubricants
290.3
299.3
305.7
326.5
336.5
329.7
325.8
326.4
324.4
326.4
324.2
333.1
R. Asphalt
388.0
388.0
388.0
388.0
388.0
411.3
411.3
431.4
431.4
441.4
441.3
441.4
S. Machine ry and Equipment Rental
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
Source : www.census.gov.ph/data/sectordata
MINIMUM WAGE Peso per Day
450.00 400.00 350.00 300.00 250.00 200.00 150.00 100.00 50.00 0.00
2001
2004
2006
2008
2011
2010
YEAR
Year
Wage Order #
Amnt. of Increase
Peso per Day
01 January 1991 16 December 1993 01 April 1994 02 February 1996 01 May 1996 06 Febuary 1997 01 May 1997 06 February 1998 31 October 1999 01 November 2000 05 November 2001* 01 Febuary 2002* 25 June 2004* 16 June 2005 11 July 2006 28 August 2007 14 June 2008 28 August 2008 23 June 2010 26 May 2011
NCR 02 NCR 03 NCR 03 NCR 04 NCR 04 NCR 05 NCR 05 NCR 06 NCR 07 NCR 08 NCR 09 NCR 09 NCR 10 NCR 11 NCR 12 NCR 13 NCR 14 NCR 14 NCR 15 NCR 16
12.00 17.00 10.00 16.00 4.00 15.00 5.00 13.00 25.50 26.50 15.00 15.00 20.00 25.00 25.00 12.00 15.00 5.00 22.00 22.00
118.00 135.00 145.00 161.00 165.00 180.00 185.00 198.00 223.50 250.00 265.00 280.00 300.00 325.00 350.00 362.00 377.00 382.00 404.00 426.00
* ECOLA (Emergency Cost of Living Allowance) Source : National Wages & Productivity Council, Department of Labor and Employment
AVERAGE EARNINGS INDEX FOR CONSTRUCTION (1987 = 100) YEAR
2011
2010
2009
2008
2,384.7
2,253.8
2,206.3
2,577.3 2,366.2 2,639.6 2,664.3 2,834.4 2,636.1
2,386.3 2,300.6 2,521.0 2,511.4 2,601.4 2,556.8 2,208.4 2,236.5 2,425.4 2,297.5 2,366.8 2,204.5
2,250.1 2,211.0 2,335.0 2,413.6 2,447.9 2,317.0 2,188.0 2,234.1 2,304.6 2,064.8 2,135.8 2,143.7
2,165.1 2,121.2 2,232.5 2,312.7 2,365.6 2,255.8 2,168.7 2,146.7 2,193.6 2,131.2 2,163.0 2,219.3
2011
2010
2009
2008
2,384.7
2,253.8
2,206.3
2,402.6 2,556.6 2,290.1 2,289.6
2,265.4 2,392.8 2,242.2 2,114.8
2,172.9 2,311.4 2,169.7 2,171.2
ANNUAL January February March April May June July August September October November December
YEAR
QUARTERLY Q1 Q2 Q3 Q4
2,527.7 2,711.6
CONSTRUCTION COST SPECIFICATION The costs for the respective categories given on the previous pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design, procurement methods and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, plant rooms, water tanks and the like. All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs exclude land cost, professional fees, finance and legal expenses. The standards for each category of building vary from country to country and do not necessarily follow those of Manila. FF&E refers to loose furniture, fixtures and equipment. FF&E is excluded from office, residential and retail project costs, but are included in hotels and country club project costs. DOMESTIC Average standard apartments of 6-8 flats per floor, 50m2 - 150 m2 per flat, facade comprising textured paint and punch window, itnernal finishes comprising wood parquet, plaster and paint and painted rubbed concrete to residential units and local ceramic tiles to toilets. Luxury residential facade comprised of window wall, textured paint with stone accents, finished with homogeneous tiles, wood cladding and coved timber ceiling to lobby, combination of wood planks, plaster and paint and gypsum board to residential units and homogenous tiles to toilets. Air conditioning, gensets, automatic sprinkler system, complete plumbing and disposal system, complete fire alarm and detection system, CATV system are allowed for luxury apartments and prestige houses. Services to standard apartment also include for paging system and Davit type gondola.Services to luxury residential also include CCTV cameras on lobby, track mounted type gondola and helipad provision. OFFICE/COMMERCIAL Based on building 30-40 storeys high with floor plans minimum 1,000 m2 per level. Average standard offices and shopping centres have bare finish and exclude A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations, stone finished lobbies
INDUSTRIAL Owner operated factories exclude manufacturing equipment, airconditioning and special services provisions. HOTELS F.F. &E. includes interior decoration and loose furniture, etc. but excludes hotel operator’s items (e.g. cutlery, crockery, linen etc.). Includes 1 level of basement. OTHERS Carparks to be multi-storey, above ground. Schools with standard government provisions. Student hostels to university standard.Hospitals include fit-out to nursing rooms, hospital facilities; services i.e., oxygen piping, A/C, genset, ultrapure water system, fire suppression system and special type plumbing fixtures; fit-out to doctors’ offices is excluded.
RETAIL PRICES OF BASIC CONSTRUCTION MATERIALS FOR PHILIPPINES Cement 240
Ordinary Concrete Hollow Blocks Php / piece
Php / bag (40kg) 15 14
220
13
200
12
180
11 10
160
9
140
8
4" thk
7
120
6" thk
6
100 2007
2008
2009
2010
5
2011
2007
2008
Year
2009
2010
2011
Year
Timber
Aggregates
Php/bdft
Php / m3 1,100
140
1,000
120
900
100
800
80
700 60
600
Sand
500
40
Gravel
400
20
300
0 2007
2008
2009
2010
2011
Softwood Hardwood 2007
Year
2008
2009
2010
2011
Year
Reinforcing Bar (Intermediate Grade - Grade 40; 275 Mpa)
Structural Steel (Angle Bar; A36)
Php/kg
Php/kg
65
75
60
70
55 50 45
65
1/4" x 2" x 20'
60
3/8" x 3" x 20'
16mm
55
32mm
50
40
45
35
40
30
35
25
30 25
20 2007
2008
2009
2010
2011
2007
Year
2008
2009
2010
2011
Year
Reinforcing Bar (High Yield Grade - Grade 60; 10 Mpa)
Structural Steel (Wide Flange)
Php/kg
Php/kg 60
65 60
55
55
14 x 30 lbs
50
50
16mm 32mm
45
45
40
40
35
35
30
30
25 20
25 2007
2008
2009 Year
2010
2011
2007
2008
2009 Year
2010
2011
UNIT COSTS FOR ANCILLARY FACILITIES FOR PHILIPPINES DESCRIPTION
UNIT
SQUASH COURTS
Single court with glass backwall including associated mechanical and electrical services per court but including any public facilities (enclosing structure not included)
DESCRIPTION
PESO
UNIT
PESO
per set
500,000 to 1,500,000
per room
500,000
per room
600,000
PLAYGROUND EQUIPMENT
1,300,000
Outdoor playground equipment comprising various activities and safety mat
1,960,000
SAUNAS
TENNIS COURTS
Single court on grade with acrylic surfacing completed with chain link fence
per court
Single court on grade with artificial turf surfacing including chain link fence
per court
2,400,000
Extra for lighting
per court
500,000
SWIMMING POOLS
Half Olympic (25m x 16m) 6-lanes outdoor swimming pool built in ground, fully tiled, complete with 5m wide deck and associated equipment Half Olympic (25mx 16m) 6-lanes indoor swimming pool with suspended structure (enclosing structure not included) fully tiled and completed with 5m wide deck, including mechanical ventilation and associated equipment.
per pool
7,500,000
STEAM BATHS
Steam bath for 4-6 people complete with all accessories (enclosing structure not included) GOLF COURSES
per pool
11,500,000
Extra for heating equipment
per pool
1,500,000
Extra for salt chlorine generator
per pool
500,000
BASKETBALL COURTS
Exposed court, approximately 975 m2 including
Sauna room for 4-6 people complete with all accessories (enclosing structure not included)
player benches and excluding equipment
per court
3,500,000
Covered court approximately 975m2, including metal viewing seats, built-in furniture, provision for T&B, etc*
per court
18,000,000
(Based on ‘Average Cost Model’ of an 18 hole golf course in Asia) per hole excluding fairway construction and rough hydroseeding
23,000,000
Including fairway construction and rough hydroseeding
per hole
27,000,000
per set
3,000,000 to 4,500,000
GOLF SIMULATOR
Complete golf simulation system complete with projector, high impact projection screen, artificial grass putting turf, putting green cup and control computer with software overall size 4m x7m x 3m high (enclosing structure not included)
* includes provision for forward/rear fold ceiling mounted basketball goal.
M & E MAJOR PLANT COSTS FOR THE PHILIPPINES DESCRIPTION
UNIT
COST (Php)
1. Water cooled electric chiller
per TR
16,000 – 25,000
2. Air-cooled electric chillers
per TR
25,000 – 35,000
3. Cooling Towers; induced draft
per GPM
1,500 – 2,000
4. Air Handling Units (AHU)
per TR
11,000 – 18,000
5. Packaged water-cooled units (PWCU)
per TR
16,000 – 21,000
6. Fire Pumps; electric motor driven
per HP
17,000 – 21,000
7. Fire Pumps; diesel engine driven
per HP
22,000 – 25,000
8. Standby generator sets
per KW
5,500 – 9,000
9. Power transformers, with built-in primary protections; padmount
per KVA
1,600 – 6,000
10. Power transformers, with primary protection; silicon oil filled
per KVA
1,300 – 4,400
11. Power transformers, with primary protection cast resin
per KVA
2,000 – 5,000
12. Sewage Treatment Plant, Sequencing Batch Reactor (SBR); including civil works
per m3/day
20,000 – 30,000
NOTE: 1. Rates are based on direct supply of imported quipment and materials by the developer. 2. Rates include all government imposed taxes, import duties brokerage fees and allowances for local materials and installation cost. 3. Rates exclude preliminaries and contingencies. 4. Rates are based on fixed price tenders received in 4th Quarter 2011.
FIT- OUT COSTS FOR PHILIPPINES DESCRIPTION
PESO/m2
HOTELS 3-star Hotel 4-star Hotel 5-star Hotel
18,000 - 22,000 24,000 - 28,000 30,000 up
Guest rooms : 3-star Hotel 4-star Hotel 5-star Hotel
16,000 - 18,000 20,000 - 25,000 25,000 - 35,000
Notes : 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings.
General dining restaurant Fine dining restaurant
15,000 - 30,000 30,000 up
Note : Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.). THEATRES / CINEMAS Theatres * Cinemas **
2. Excludes partitioning, M & E works, building shell, chandelier, operational items and equipment (e.g. bed, cutlery, crokery, linen, television, refrigerator, etc.), opening expenses, stage equipment and computer systems. 18,000 - 22,000
1. Mall/Public areas only; tenant area to be bare finish 2. See notes 1,2,& 3 below OFFICES Standard offices * Executive offices ** Banking lobby ***
PESO/m2
RESTAURANT
Public Areas (Front of House) :
COMMERCIAL Shopping centers Notes :
DESCRIPTION
18,000 - 26,000 35,000 - 50,000 55,000 - 65,000
* Medium quality systems furniture ** High quality furnitures and finishes *** Imported stone finishes; double volume spaces Note : See notes 1, 2 & 3 below
NOTE: 1. Costs are at December 2011 Levels. 2. Costs include wall, floor, ceiling finishes, doors, FF&E, M&E Works service reticulation, preliminaries Forex US$1:43 3. Costs exclude operational equipment and supplies, structure, external enclosure, major M&E plant, financing and developers costs, professional and marketing fees.
55,000 - 70,000 30,000 - 45,000
* Includes stage rigging and equipment, draperies, AV equipment projectors, screens, acoustics and seatings ** Includes screens, projection equipment, seats, finishes, ticketing booth AUDITORIUMS
50,000 - 65,000
BUSINESS CLUBS
45,000 - 70,000
BAR / BILLIARDS *
40,000 - 45,000
* Excluding kitchen equipment
KITCHEN EQUIPMENT COSTS FOR PHILIPPINES DESCRIPTION BUSINESS CLUB 500 - 900 m2 floor area EXECUTIVE DINING 200 - 400 m2 floor area
4 STAR HOTEL 50 - 150 rooms 5 STAR HOTEL 200 - 500 rooms
OFFICE CANTEEN 200 - 300 m2 floor area
COST (Php) 15M - 20M
15M - 25M
20M - 30M
30M - 40M
10M - 20M
TRENDS IN CONSTRUCTION COSTS FOR PHILIPPINES Php / m2 (Thousands)
80 Office Bldgs. - Grade A
70
Residential - Luxury Apts. Retail Stores
60
Hotels - 5-star
50 40 30 20 10 0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Year
Building Construction Cost (Php/m2) Hotels
2001 2002
56,160 30,680 57,240 31,270
36,140 36,835
20,800 21,200
52.00 53.00
2003
57,750 31,625
37,125
20,625
55.00
2004
58,800 32,200
36,680
18,840
56.00
2005
58,850 32,175
36,850
19,800
55.00
2006
60,000 34,000
37,000
21,760
50.00
2007
60,200 36,980
37,410
26,500
43.00
2008
66,960 45,120
44,160
29,500
48.00
2009
67,000 45,120
44,180
29,800
47.00
2010 2011
69,080 46,860 68,800 46,400
45,760 46,010
32,340 41,280
44.00 43.00
Office
Residential Retail
US$ to Php
Year
PROPERTY COMMENTARY by Jones Lang LaSalle Leechiu
In General The robust performance of the general property market in 2010, particularly in Metro Manila, had sparked optimism in the market in 2011. This has led property developers to introduce new projects and has encouraged increases in real estate prices. As a result, positive growth in all property sectors (commercial office, residential, hotel, retail and industrial) has been observed. The upward trend in rentals that started in 2010 continued in 2011 as commercial office spaces in Makati, Ortigas and Bonifacio Global City enjoyed healthy demand primarily from the offshoring and outsourcing (O&O) sector. As a result, property developers were encouraged to roll out more new office projects in various areas in Metro Manila. Consequently, the volume of future supply in the next few years has thoroughly increased as compared to the previous year. In 2012, prices are still projected to rise although tightening competition brought on by the large incoming supply may limit their growth. The residential condominium sector has sustained its positive performance in 2011, supported by the remittances from overseas Filipinos and relatively low interest rates. In the coming years, the future stock of residential condominiums is expected to further increase, reaching twice the current stock by 2015. The large incoming supply may lead to an imbalance between demand and supply, which may limit growth in rentals and capital values in the mid-term. The retail sub-sector has also recorded improvements in 2011 as mall developers reported growth in their rental income. Despite the lower domestic economic growth and the fragile state of the global economy, remittance inflows from overseas Filipinos have helped buoy retail spending in the country. Over the next year, the forecast modest economic growth may likely support moderate growth in the retail sector as well. In the coming years, the hotel sub-sector is expected to experience a boom in room supply as new hotels across Metro Manila are completed. Majority of these new hotels will likely be concentrated in Bonifacio Global City and Entertainment City – where most of the upcoming hotels are casino-related. Aside from Metro Manila, many developers are venturing to more leisure resort developments outside Metro Manila. These activities may potentially attract more investments in the hotel sub-sector. The industrial market remained resilient despite experiencing a challenging year as economic externalities affected the performance of the country’s exports. The sub-sector may likely post minimal growth in the near term. However, recovery in the country’s trade and manufacturing industry can propel growth in the industrial sub-sector.
In general, the outlook on the property market for 2012 remains positive, albeit growth may be modest as compared to the relatively high growth experienced in the last couple of years. Amidst the positive sentiments for the market for the year, property players are advised to exercise caution as the global economy continues to be volatile. The slow recovery of the US economy from the last recession in 2009 and the lingering Eurozone debt crisis, are market externalities that threaten to dampen the growth prospects of the property market. Commercial Sector Jones Lang LaSalle Leechiu Research, Consulting & Valuation (“JLLL Research, Consulting & Valuation”) notes that the consolidated office stock for all grades in the established business districts of Makati, Ortigas and Bonifacio Global City stood at approximately 5.46 million sqm in 2011. This represents around 80% of the total stock of office space in Metro Manila (includes the emerging urban districts of Eastwood City, Bay City, Newport City, Alabang and other districts in Quezon City among others). Average vacancy of office developments in Makati CBD and Bonifacio Global City declined from last year’s level to an estimated 4%. In the next four years, approximately 1.06 million sqm are expected to be added to the total office stock in Makati CBD, Ortigas CBD and Bonifacio Global City. In 2012, more than 300,000 sqm of new office space are being constructed. Most of this future supply will come from completions in Bonifacio Global City. After the downturn in the property market experienced in 2009, the office sector recovered in 2010 as rentals began rising again. In 2011, rentals of office developments have continued this upward trend. Average rental rates of prime and Grade ‘A’ offices in Makati and Bonifacio Global City have grown to reach around Php9,100 per sqm per annum from approximately Php7,980 per sqm per annum in the previous year. However, the upcoming supply in 2012, which is more than twice the completions in 2011, may affect the growth in rentals. JLLL Research, Consulting & Valuation estimates that the average achievable gross rental levels for Grade ‘A’ facilities in Makati CBD (which continue to enjoy a premium to the overall market) is approximately at Php750 to Php850 per sqm per month over 2012. Average rentals in prime office developments in Makati CBD are projected to hover around Php900 to Php1,000 per sqm per month. Meanwhile, rentals in office developments in Ortigas CBD are projected to reach around Php500 to Php650 per sqm per month. For office developments located in Bonifacio Global City, rentals are estimated within the range of Php650 to Php850 per sqm per month. In terms of capital values, Grade ‘A’ offices in Makati CBD are estimated to achieve resale prices at around Php75,000 to Php90,000 per sqm. In Ortigas CBD, average capital values of office spaces are projected within the range of Php45,000 to Php55,000 per sqm. Residential Condominium Sector From the economic slowdown in 2009, the residential property sector picked up in 2010 and continued to perform well in 2011. Demand continued to be fueled by the sustained inflow of remittances from overseas Filipinos coupled with the low interest rates
and flexible financing schemes. In terms of supply, the residential condominium market continued to exhibit strong growth as total stock in Makati CBD, Ortigas CBD, and Bonifacio Global City is estimated at around 45,300 units in 2011. Total Number of Residential Condominium Units Makati CBD, Ortigas CBD and Bonifacio Global City: By Type of Units (2001 - 2015E) 120,000
100,000
80,000
60,000
40,000
20,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E Makati CBD
Bonifacio Global City
Ortigas
Supply side factors in the residential sector remain a concern as the number of residential condominium buildings further increases. The large magnitude of supply expected in the coming years may negatively affect the growth of rentals and capital values. From 2012 to 2015, around 54,000 residential units are expected to be added to the total supply in Makati CBD, Ortigas CBD and Bonifacio Global City. On average, around 13,000 units are expected per year for the next four years. Rental rates of condominiums located in Makati CBD, Ortigas CBD and Bonifacio Global City averages between Php375 and Php700 per sqm per month. Meanwhile, average resale capital values in these districts range from around Php60,000 to Php115,000 per sqm, depending on the quality and location of the condominium. Hotels and Service Apartments Sector The total number of hotel rooms has reached 15,765 rooms (as of April 2011). Majority of the supply still stems from the deluxe and standard hotel classification. These types of hotels also pose the highest occupancy rates from January to August 2011. Occupancy rates of deluxe hotels picked up as it rose to 72% while average occupancy of standard hotels remained at 66%. However, overall occupancy of hotels across the various classifications remained at roughly the same level. After the slight decline in occupancy rates in 2009, which may be attributed to the global economic slowdown, performance of hotels picked up in 2010. With the help of the growing number of tourists coming into the country hand in hand with the economic recovery in many countries, many hotels experienced a boost in their occupancy rates, especially with deluxe hotels. This trend continued through 2011, as occupancy rates continued to rise for deluxe hotels.
Average Occupancy Rates of Hotels in Metro Manila By Hotel Classification: 1996 to 2011 80% 70% 60% 50% 40% 30% 20% 10% 0%
96
97
98
99
00
01
02
03
04
05
06
07
08
09
10
11
Deluxe (5-star)
75.00 73.00 60.00 63.81 65.27 58.39 62.72 61.23 71.03 74.03 73.63 73.84 70.11 64.43 70.45 72.17
First Class (4-star)
66.00 70.00 55.00 60.44 50.80 54.24 59.90 59.94 65.80 70.22 72.32 75.89 68.97 60.61 62.43 60.17
Standard (3-star)
65.00 62.00 53.00 51.53 53.14 52.51 55.88 58.97 64.28 67.88 70.29 71.81 70.77 67.77 65.72 66.05
Economy (2 and 1-star) 49.00 57.00 51.00 53.24 37.97 41.13 51.34 54.07 54.12 65.90 58.42 61.76 62.32 64.63 59.04 63.18 Deluxe (5-star) First Class (4-star) Standard (3-star) Economy (2 and 1-star)
In the next four years, more than 9,000 hotel rooms are expected to open in Metro Manila. In 2012 alone, around 2,000 hotel rooms would be added to the Metro Manila market. Upcoming hotel
developments are expected in Quezon City, the Bay Area, Bonifacio Global City and Alabang are expected to boost tourist arrivals in the next few years. Retail Sector
In 2011, the retail property sector sustained its positive performance as shopping mall rentals witnessed growth and new retail stock was added during the year. The retail market continues to benefit from the country’s large consumer market, which is supported by the remittances from overseas Filipinos. Despite the various ongoing problems affecting the global economy, such as the debt crisis in the Eurozone and the slow recovery of the US economy, remittances still grew by around 7% from January to September 2011. Despite the various ongoing problems affecting the global economy, such as the debt crisis in the Eurozone and the slow recovery of the US economy, remittances still grew by around 7% from January to September 2011. Total remittances in 2011 is estimated at around USD20 billion, while remittances for 2012 is forecast to grow by 5%. As a result of a stable inflow of remittances from overseas Filipinos and the generally healthy spending of consumers in the country, demand in the retail property market witnessed positive growth in the last couple of years with the entry and expansion of new international retailers. Most of these retailers have either food or clothing businesses. In 2012, many of these new retailers are expected to expand within Metro Manila, and may venture out to other urban centers in the Philippines. In terms of supply, there were a few new shopping malls and expansions of existing malls completed in 2011. With these new additions, total retail stock of major malls in Metro Manila reached 4.0 million sqm. In the next few years, Metro Manila will likely witness several new mid-scale shopping malls, more expansions of existing shopping centers as well as retail malls within mixeduse developments. In 2012, more than 200,000 sqm of retail space is expected to be added to the total retail stock in Metro Manila. Despite the additional retail space, JLLL Research, Consulting & Valuation estimates vacancy rates in major malls to
Accumulated Total Supply of Gross Leasable Space (in sq. m.) Major Metro Manila Retail Malls 1995-2012E
4,500 4,000 3,500
GLA (in '000 sqm)
3,000 2,500 2,000 1,500 1,000 500
E 12
11
20
10
20
09
20
20
08
07
20
06
20
05
20
20
04
03
20
02
20
01
20
20
00
99
20
98
19
97
19
19
96
19
19
95
0
remain in the vicinity of 4%-5%. In addition, mall developers are also entering other underserved provinces where shopping centers are few and rare. Overall, retail supply in the Philippines is expected to follow an upward pattern in the short- to mediumterm. Industrial Sector The industrial property sector recovered in the early part of 2011 as evidenced in the positive figures recorded over the said period. Industrial land values picked up as developers faced renewed interest from firms riding on the positive growth of the economy. Average estimated land values in Cavite and Laguna were observed to be between Php 3,000 and Php 3,700 per sqm. Meanwhile, asset performance likewise improved as average rentals in the aforementioned areas reached Php 110 to Php184 per sqm per month. The sector remained relatively stable despite the set of crises in Japan and more recently, the double digit dip in the country’s exports in September. Total foreign direct investments in the country surged in 3Q11, posting a 32% growth to Php 25 billion. Approximately Php 9.6 billion of investment pledges were cornered by the manufacturing sector alone. This growth in investments may represent the increased interest of foreign firms to enter the Asian market as Western economies are poised to post slow growth in the medium term. This increased interest may also be reflected in the sustained take up of industrial products coupled with the higher number of on-going constructions in select ecozones of the country. The industrial market may exhibit subdued growth in 2012 as externalities continue to exert pressure over the global economy. In particular, the growing US debt and Eurozone crisis may impact on the export-dependent Asian economies. Despite these externalities, industrial growth may be supported in the medium term by regional trade with the country’s resilient Asian trading partners. In the local scene, the open access to electricity is expected to be implemented by September 2012 and is projected to assist firms in securing cost-effective power rates which may improve the marketability of the industrial sector. Disclaimer: This document is prepared by Jones Lang LaSalle Leechiu, for information only. Whilst reasonable care has been exercised in preparing this document, it is subject to change, and Jones Lang LaSalle Leechiu makes no representations as to its truth, accuracy or completeness, and accordingly cannot be held responsible for any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document.
Provided by : Jones Lang Lasalle Leechiu
Jones Lang LaSalle Leechiu is the leading provider of professional services in real estate in the Philippines. Globally, the firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2010 global revenue of more than USD 2.9 billion, Jones Lang LaSalle serves clients in 60 countries from more than 1,000 locations worldwide, including 185 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.8 billion square feet worldwide. Jones Lang LaSalle has over 50 years of experience in Asia Pacific, with over 19,400 employees operating in 78 offices in 13 countries across the region. Jones Lang LaSalle Leechiu is currently the number one agency in the Philippines, bringing together strong local presence and talent and a global platform and infrastructure. Jones Lang LaSalle Leechiu 5/F Equitable Bank Tower 8751 Paseo de Roxas 1226 Makati City Philippines Telephone : +63 (2) 902 0888 Fax : +63 (2) 729 5159 Website : www.joneslanglasalleleechiu.com.ph : ap.joneslanglasalle.com/researchhub For more information, please contact : David T. Leechiu Country Head Telephone : +63 (2) 902 0880 Mobile : +63 (918) 910 5158 Email : [email protected] Claro dG. Cordero, Jr. Head, Research, Consulting & Valuation Telephone : +63 (2) 902 0887 Mobile : +63 (918) 914 3309 Email : [email protected]
PHILIPPINES KEY DATA POPULATION
Population (August 2007) Population # (2012)
88.57M 97.69M
Urban Population * Population under 15
30.14% 31.97%
Population over 65 Ave. annual growth rate (2000 - 2007)
3.31% 2.04%
GEOGRAPHY
Land Area Agricultural Area (2010) Capital City (population metropolitan Manila) (population Manila)
300,000 km2 42.98% Manila 11.55M 1.66M
ECONOMY 2011
Monetary Unit Average Headline Inflation rate (Jan - Nov)
Peso
(2006 = 100) Gross Domestic Product (GDP) (1Q to 3Q) GDP per capita
4.83%
CONSTRUCTION (1Q to 3Q) in 2011
Gross value of const. output Net value of const. output Net value of const. output as a proportion of the GDP
* #
Population of Philippines’ key cities only Forecast / Projected
Php 7,005.072bn Php 79,090.80
Php 538.736bn Php 393.553bn 2.07%
ECONOMIC HIGHLIGHTS 3rd Quarter 2011 Philippine Economy grows by 3.2 percent in Q3 2011 The domestic economy has decelerated for the third consecutive quarter from the 7.3 percent honey moon growth last year to 3.2 percent this year. The so called death spiral of debt that hounds our trading partners, the uninvigorating, albeit already expanded government spending, and the decline in fishing due to unfavorable weather and the high cost of fuel contributed to this relatively lethargic growth. As almost always, the Services sector saved the domestic economy from posting an even lower growth. With the downwardly revised second quarter GDP estimate, this puts the growth for the first nine months of 2011 at 3.6 percent, quite a distance even from the lower end of the whole year target of 4.5 percent. On the demand side, consumer spending bolstered growth but Construction continued to suffer from the much delayed implementation of the Public-Private Partnership program while Export of Goods really got hit by the global crisis, posting a double digit decline for the first time since the second quarter of 2009. Industry declines The Industry Sector contracted by 0.2 percent, its second consecutive quarter of decline after posting robust growths in the preceding five quarters. Manufacturing and Mining and Quarrying contributed positively to Industry with [2.06 percentage point] and [0.03 percentage point]; respectively. Construction was the star under performer again, pulling down the growth of Industry [with negative 2.15 percentage point]. Electricity, Gas and Water Supply, likewise made a negative contribution of [0.12 percentage point]. Construction slumps For the second consecutive quarter, Construction declined by 12.2 percent from a growth of 15.6 percent recorded last year with the decline of Private Construction and the contraction, albeit lower, of Public Construction. Source
: The National Accounts of the Philippines National Statistical Coordination Board (www.nscb.gov.ph)
CONSUMER PRICE INDEX % Change in CPI Index 9 8 7 6 5 4 3 2 1 0
2007
2008
2009
2010
2011
Year
Note
Year
Index
% Change
2006
100.0
2007
102.9
2.95%
2008
111.4
8.15%
2009
116.0
4.22%
2010
120.4
3.80%
2011*
126.0
4.84%
: Base date 2006 = 100 * January - November 2011 CPI Average
EXCHANGE RATES
Approximate rates prevailing as at 02 January 2012 US$ in PHP in Foreign Foreign Currency Currency
Currency
Foreign Currency in PHP
Australia*
dollar
44.88
0.0222
0.98
Bahrain*
dinar
116.50
0.0085
0.38
Brunei*
dollar
33.74
0.0296
1.30
Canada*
dollar
43.09
0.0232
1.02
China*
yuan
6.95
0.1434
6.32
Denmark+
kroner
7.65
0.1438
6.32
COUNTRY
European Currency Unit*
euro
56.84
0.0175
0.77
Hong Kong*
dollar
5.65
0.1768
7.77
India+
rupee
0.83
1.2070
53.01
Indonesia*
rupiah
0.00
208.3333
9,090.00
yen
0.57
1.7519
76.94
ringgit
13.86
0.0721
3.17
New Zealand+
dollar
34.12
0.0293
1.29
Norway
kroner
7.34
0.1361
5.97
Japan* Malaysia+
Notes: * Convertible currencies with BSP + Non Convertible currencies with BSP BSP Bangko Sentral ng Pilipinas Source: Business Worls - BSP Reference Rate
COUNTRY
Pakistan+
Currency
Foreign PHP in US$ in Currency Foreign Foreign in PHP Currency Currency
rupee
0.49
2.0441
89.78
rial
11.71
0.0853
3.75
Singapore*
dollar
33.87
0.0295
1.29
South African+
rand
6.49
0.1542
6.79
South Korea*
won
0.38
26.3852
1,158.75
Sweden+
kroner
6.37
0.1568
6.88
Switzerland*
franc
46.842
0.0213
0.94
Saudi Arabia*
Taiwan+
NT dollar
1.45
0.6892
30.27
Thailand*
baht
1.40
0.7179
31.53
United Arad Emirates (UAE)*
dirham
11.96
0.0836
3.67
United Kingdon*
pound
68.25
0.0146
0.64
dollar
43.92
0.0227
1.00
United States of America*
CURRENCY CHARTS Note: Monthly Average Rate
Sterling Pound
US Dollar Php per US$
Php per GBP
60
120
50
100
40
80
30
60
20
40
10
20
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008
Year
2009
2010
2011
2009
2010
2011
2010
2011
Year
Singapore Dollar
Japanese Yen
Php per Singaporean Dollar
Php per 100 Japanese Yen 60
40
50 30
40 30
20
20 10
10
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008
Year
Year
Euro
Dirham
Php per Dirham
Php per Euro
16
80
14
70
12
60
10
50
8
40 30
6 4
20
2
10
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008 Year
Year
Hong Kong Dollar
Australian Dollar
Php per Hong Kong Dollar
Php per Australian Dollar
10
50
8
40
6
30
4
20
2
10
0
0 2006
2007
2008 Year
2009
2009
2010
2011
2006
2007
2008 Year
2009
2010
2011
MANILA REFERENCE RATE Manila Reference Rate (%) 10
8
6
4
2
0 2006
2007
2008
Year
2009
2010
2011
PHILIPPINE CENTRAL BANK MANILA REFERENCE RATE DATE
Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec
%
2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011
Note: Based on all maturities.
6.81 7.13 6.63 6.63 6.31 6.56 5.75 6.06 5.63 5.63 5.06 5.38 5.50 5.40 5.02 4.88 4.79 4.81 4.88 4.86 4.71 4.71 4.83 4.81
PHILIPPINE MAP
ENVIRONMENTAL SUSTAINABILITY Overview of Leadership in Energy & Environmental Design (LEED) The U.S. based Leadership in Energy & Environmental Design (LEED) Green Building System is a voluntary third-party rating system in which credits are earned for satisfying specified green building criteria. Projects are evaluated within six environmental categories. • • • • • •
Sustainable Sites Water Efficiency Energy & Atmosphere Materials & Resources Indoor Environmental Quality Innovation & Design
Certified, Silver, Gold and Platinum levels of green building certification are awarded based on the total points earned. Professional Services Pre Design Integrated sustainable design consulting ensures available opportunities are recognized and explored • Assist in team selection • Evaluate project-specific opportunities and challenges based on LEED goals • Create project-specific green guidelines Design Team members works closely and effectively towards a green solution. • Create sustainable design checklist including schedule and design implications • Thoroughly evaluate design at key stages and provide detailed instructions to the design team • Monitor design team responsibilities • Coordinate cost analysis with sustainable design goals • Develop on energy model • Liaise with USGBC • Assist and compile LEED documentation for Green Building Certification Institute (GBCI) review Construction • Provide pre-bid conferences and contractor training • Assist during construction, including submittals and progress reports • Monitor the implementation of green guidelines or green site conditions • Liaise with USGBC • Assist and compile LEED documentation for certification
Operations • Perform post-occupancy project audits - lessons Being part of LEED Global Linkage Davis Langdon & Seah (Phils) Inc. is a member of US Green Building Council (USGBC) and the Philippine Green Building Council (PGBC). Our environmental sustainability services employed highly skilled Leadership in Energy & Environmental Design - Accredited Professionals (LEED-®AP), certified Building for Ecologically Responsive Design Excellence (BERDE) Professionals and highly qualified Energy Modeller. Green Building Facts • An Up-front investmentof 5-7% in green building design, on average, results in life cycle savings of 20% of the total construction cost. Source: The Costs and Financial Benefits of Green Buildings: A report to California’s sustainable Building Task Force, October 2003 • Operating cost decrease 8-9% • Building value increase 7.5% • Return on investment improved 6.6% • Occupancy ratio increase 3.5% • Rent ratio increases 3% Source: McGraw Hill Construction, Greening of Corporate America SmartMarket Report, 2007. • Green buildings consume less energy and fewer resources • Green buildings consume 15-20% average less energy than conventional buildings • Green buildings save, on average, 40% of drinkable / potable water • Corporate perception of whether green fosters innovation: 57% agree; 28% neutral and 15% disagree. Source: McGraw Hill Construction, Greening of Corporate America SmartMarket Report, 2007.
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, India, Malaysia, Philippines and Vietnam and is also the editor of the Spon’s Price Book Series which comprise • Spon’s Asia Pacific Construction Costs Handbook • Spon’s European Construction Costs Handbook • Spon’s Architects' and Builders’ Price Book • Spon’s Civil Engineering and Highway Works Price Book • Spon’s Mechanical and Electrical Services Price Book • Spon’s Landscape and External Works Price Book (co-edited by Derek Lovejoy Partnership) As in the previous editions, the DLS Handbook -Singapore 2012 focuses on the construction cost profile of Singapore and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in Asia. The information contained in this handbook has been compiled by Davis Langdon & Seah Singapore Pte Ltd. Any further information and/or if advice relating toparticular projects is required, please contact any of the regional offices listed under the Directory of Davis Langdon & Seah International Offices at the end of this handbook. Davis Langdon & Seah Singapore Pte Ltd
MATERIAL PRICE INDICES CEMENT IN BULK YEAR $/TONNE
INDEX (BASE 1994)
STEEL BARS
INFLATION $/TONNE
BRICKS^
INDEX (BASE 1994)
INFLATION
$/'000 BRICKS
INDEX (BASE 1994)
READY MIXED CONCRETE 1
GRANITE INFLATION $/TONNE
INDEX (BASE 1994)
INFLATION
$/m 3
INDEX (BASE 1994)
INFLATION
94
135.00
100.0
-
585.04
100.0
-
233.00
100.0
-
17.97
100.0
-
101.35
100.0
-
95
134.00
99.3
-0.7%
542.51
92.7
-7.3%
244.00
104.7
4.7%
18.11
100.8
0.8%
103.01
101.6
1.6%
96
135.00
100.0
0.7%
526.97
90.1
-2.8%
240.00
103.0
-1.6%
20.68
115.1
14.2%
111.04
109.6
7.9%
97
131.00
97.0
-3.0%
521.03
89.1
-1.1%
227.00
97.4
-5.4%
22.12
123.1
7.0%
106.96
105.5
-3.7%
98
107.00
79.3
-18.2%
522.86
89.4
0.3%
185.00
79.4
-18.5%
14.45
80.4
-34.7%
83.35
82.2
-22.1%
99
74.00
54.8
-30.9%
474.50
81.1
-9.3%
135.00
57.9
-27.1%
11.38
63.3
-21.3%
70.36
69.4
-15.6%
00
71.00
52.6
-4.0%
458.65
78.4
-3.3%
141.00
60.5
4.5%
12.55
69.8
10.3%
71.32
70.4
1.4%
01
70.00
51.9
-1.3%
432.81
74.0
-5.6%
147.00
63.1
4.3%
12.69
70.6
1.1%
61.40
60.6
-13.9%
02
67.00
49.6
-4.4%
442.92
75.7
2.3%
149.00
63.9
1.3%
12.65
70.4
-0.3%
55.41
54.7
-9.7%
03
71.00
52.6
6.0%
579.62
99.1
30.9%
163.00
70.0
9.5%
12.25
68.2
-3.1%
56.75
56.0
2.4%
04
76.76
56.9
8.2%
863.40
147.6
48.9%
185.77
79.7
13.9%
12.57
69.9
2.5%
62.50
61.7
10.2%
05
85.21
63.1
10.9%
738.44
126.2
-14.5%
267.86
115.0
44.3%
16.29
90.7
29.8%
72.13
71.2
15.4%
06
88.02
65.2
3.3%
729.52
124.7
-1.2%
-
-
-
16.58
92.3
1.8%
73.88
07*
115.40
08
85.5
120.40
09
89.2
93.40
10
69.2
89.00
11p**
65.9
94.60
70.1
31.1% 4.3% -22.4% -4.8% 6.4%
1,054.60 913.00 722.50^^ 867.50 936.00
180.3 156.1 123.5^^ 148.3 160.00
44.6%
-
-13.4%
-
-
-20.9%
-
-
20.1%
-
-
-
7.9%
-
-
-
-
-
-
24.10 23.90 17.10 23.40 20.20
127.00
125.3
-0.8%
121.90
2
120.3
2
-4.0%
-28.4%
3
3
-23.4%
105.3
4
14.3%
107.7
4
2.3%
45.3%
133.0 130.2 112.4
2.4% 2
134.1 95.2
72.9 2
93.30
36.8%
106.70
4 4
-13.7%
109.20
92.1
71.9%
Source: Building and Construction Authority as at 8 November 2011 Note: ^From 1st Quarter 2006, statistics on bricks have been discontinued. *Market prices from 2007 to 2010 are based on prices as at the month of December. **Market prices for 2011 are preliminary ('p' denotes preliminary) and are based on prices as at the month of October. ^^The market prices of rebar from 2009 onwards are based on fixed supply contracts with contract period 6 months or less. 1 Prior to 2007, the market prices of ready mixed concrete (RMC) were for Grade 30. 2 The market prices of RMC were for Grade 35. 3 The market prices of RMC were based on non-fixed price contract for Grade 35 Pump. 4 The market prices of RMC are based on contracts with non-fixed price, fixed price and market retail price for Grade 40 Pump. 200
160
120
80
40 94
95
96
97
98
99
Cement In Bulk
00
01
Steel Bars
02
03
Bricks
04
Granite
05
06
07
08
Ready Mixed Concrete
09
10
11p
TENDER PRICE, MATERIAL, LABOUR AND CONSUMER PRICE INDICES BCA TPI YEAR
INDEX
BCA BMPI
INFLATION
INDEX
(BASE 2005)
INDEX
BCA LCI INFLATION
INDEX
(BASE 2005)
CPI*
INDEX
INFLATION
INDEX
(BASE 2005)
INDEX
INFLATION
(BASE 2005)
94
100.7
-
118.2
97.5
-
105.3
102.5
-
82.3
91.0
-
95
104.8
4.1%
119.9
98.9
1.4%
109.3
106.4
3.8%
83.7
92.6
1.7%
96
107.6
2.7%
120.8
99.7
0.8%
112.2
109.3
2.7%
84.9
93.9
1.4%
97
107.3
-0.3%
119.4
98.5
-1.2%
111.2
108.3
-0.9%
86.6
95.8
2.0%
98
100.2
-6.6%
115.9
95.6
-2.9%
112.0
109.1
0.7%
86.4
95.5
-0.3%
99
88.9
-11.3%
111.9
92.3
-3.5%
98.7
96.1
-11.9%
86.4
95.5
0.0%
00
87.9
-1.1%
112.4
92.7
0.4%
103.1
100.4
4.5%
87.6
96.8
1.3%
01
88.1
0.2%
112.5
92.8
0.1%
102.3
99.6
-0.8%
88.4
97.8
1.0%
02
89.9
2.0%
112.5
92.8
0.0%
104.7
101.9
2.3%
88.1
97.4
-0.4%
03
95.6
6.3%
113.6
93.7
1.0%
104.9
102.1
0.2%
88.5
97.9
0.5%
04
98.9
3.5%
117.9
97.3
3.8%
104.6
101.9
-0.2%
90.0
99.5
1.7%
05
100.0
1.1%
121.2
100.0
2.8%
102.7
100.0
-1.9%
90.4
100.0
0.5%
06
103.2
3.2%
-
-
-
-
-
-
91.3
101.0
1.0%
07
122.5
18.7%
-
-
-
-
-
-
93.2
103.1
2.1%
08
137.3
12.1%
-
-
-
-
-
-
99.4
109.9
6.6%
09
115.9
-15.6%
-
-
-
-
-
-
100.0
110.6
0.6%
10
114.4
-1.3%
-
-
-
-
-
-
102.8
113.7
2.8%
11**
114.5
0.1%
-
-
-
-
-
-
109.2
120.7
6.2%
*The Singapore Department of Statistics has rebased the Consumer Price Index (CPI) Base Year to Year 2009. **Indices for 2011 are based on 3rd Quarter 2011. Source: Building and Construction Authority and Singapore Department of Statistics 145
135
125
115
105
95
85 94
95
96
97
98
BCA TPI
99
00
01
02
BCA BMPI
03
04
05
BCA LCI
06
07
08
CPI
09
10
11
STANDARD FORMS (PRIVATE SECTOR) MAIN FEATURES SIA Articles and Conditions of Building Contract (1) Contractor’s rates include all other works necessary to complete the Works, whether or not specifically mentioned in the Contract Documents [Article 5] (2) Architect’s orders must be expressed as ‘directions’ or ‘instructions’ [Clause 1(2)] (3) Contractor is responsible for own design and of his sub-contractors or suppliers [Clause 3(1)] (4) Contractor must supply a make-up of his prices [Clause 5] (5) Provision is made for staged possession of the site and phased completion of the Works [Clauses 10 and 25] (6) No provision for Employer to take out insurances [Clauses 19 and 20] (7) Contractor’s notification within 28 days of any event, direction or instruction entitling the Contractor to an extension of time with condition precedent to an extension of time [Clause 23(2)] (8) Following failure of Contractor to remedy any defects within 3 months from the date of issue of Schedule of Defects (or such other time as stated in the Appendix), Architect must direct the Contractor, within 14 days from the expiry of 3 months from the issue of the Schedule of Defects, that a defect need not be remedied. In lieu thereof, the Employer may deduct from any monies due to or recover from the Contractor based on the estimated cost incurred by the Employer to employ other Contractors to remedy the defects [Clause 27.4] (9) After the expiry of the Maintenance Period and all defects are either remedied, or dealt with under Clause 27.4, Architect to issue Maintenance Certificate [Clause 27.5] (10) Contractor is responsible for Designated/Nominated SubContractors in respect of design, delays, etc [Clause 28(2)] (11) Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) on Employer on the last day of each month following the month in which the contract is made (or otherwise by such time or on such day specified in Appendix) where interim payment is based on periodic valuation, or on certified completion of the relevant stage where interim payment is by stage instalments [Clause 31(2)] (12) Architect issues Interim Certificates within 14 days after receipt of payment claim [Clause 31(3)] (13) Second release of Retention monies shall be paid under the Final Certificate issued by the Architect at the expiry of the Maintenance Period or the issuance of Maintenance Certificate, whichever is the later [Clause 31(10)]
(14) Architect has no power to certify compensation to Contractor for breaches of contract by Employer [Clause 31(14)] (15) Employer responds to payment claim by providing, or causing to be provided, a payment response within 21 days after service of payment claim by Contractor [Clause 31(15)] (16)Contractor entitled to serve Notice of Termination following failure of payment of adjudicated amount by Employer [Clause 33(3)] (17)Contractor entitled to suspend work pursuant to provisions of Building and Construction Industry Security of Payment Act [Clause 33(6)] (18) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 38] (19) Parties may refer technical disputes to expert determination; provision for expert determination does not affect or prejudice right to refer dispute to mediation or arbitration [Clause 38A]( 20)Optional clauses permit fluctuations on specified materials [Clause 39] and insurance excesses [Clause 40] SIA Conditions of Sub-Contract (1) Contractor issues directions and instructions to the SubContractor [Clause 5.1] (2) Contractor orders variations on sub-contract works [Clause 7.1] (3) Application for extension of time is made to the Contractor, not the Architect [Clause 11.2] (4) Time period for notification of any event, direction or instruction entitling the Sub-Contractor to an extension of time is 21 days [Clause 11.2] (5) Extension of time is assessed and granted by the Contractor [Clause 11.2] (6) The following certificates are issued by the Contractor: - Sub-Contract Completion Certificate [Clause 11.3] - Sub-Contract Maintenance Certificate [Clause 12.2] - Sub-Contract Termination Certificate [Clause 13.1] (7) Provision for recovery of general damages only - amount is set off and deducted from monies due to the Sub-Contractor after condition precedents are satisfied [Clause 11.4] (8) Contractor can terminate sub-contract without the need for the Architect to issue notices [Clause 13.1] (9) Sub-Contractor is entitled to serve Notice of Termination following failure of payment of adjudicated amount by Contractor [Clause 13.6]
(10) Sub-Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) on Contractor on the last day of each month following the month in which the subcontract is made where interim payment is based on periodic valuation, or on certified completion of the relevant stage where interim payment is by stage instalments [Clause 14.4] (11) Contractor responds to payment claim by providing, or causing to be provided, a payment response within 21 days after service of payment claim by Sub-Contractor [Clause 14.5] (12) Where sub-contract is a supply contract, Contractor o respond to payment claim by paying Sub-Contractor claimed amount or such amount as Contractor agrees to pay [Clause 14.6] (13) Contractor has no power to revise or correct any certificates issued by him save for clerical, computational or typographical errors, or errors of a similar nature [Clause 14.10] (14) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 16] (15) Parties may refer technical disputes to expert determination; provision for expert determination does not affect or prejudice right to refer dispute to mediation or arbitration [Clause 16A] REDAS Design and Build Conditions of Contract (1) No order of priority for Contract Documents; in the event of any discrepancies between the documents, Employer's Requirements shall prevail [Clause 1.7] (2) Provision for Named Sub-Contractors; Contractor is entitled to rights of objection [Clause 2.4 and 2.5] (3) Contractor's Works and design shall be fit for their intended purpose in accordance with the Employer's Requirements; Contractor also responsible for the sufficiency and correctness of the Employer's designs, specifications and calculations in the Employer's Requirements [Clause 4.1] (4) Administration of the Contract is carried out by the Employer's Representative appointed by the Employer; Employer's Representative's duties can be delegated to assistants with Employer's consent [Clause 5] (5) Provision is made for completion of the Works in whole or in phases/sections [Clause 10] (6) Contractor must satisfy extensive criteria before handing over [Clause 11] (7) Employer may occupy any parts of the Works upon issuance of the Handing Over Certificate of Occupied Part by the Employer's Representative [Clause 12] (8) Contractor’s application for extension of time within 28 days of occurance of cause of delay is condition precedent to an extension of time [Clause 16.2]
(9) Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act 2004) (“the SOP Act”) on the Employer on the last day of each month following the month in which the Contract is made (or otherwise by such time or on such day as stated in Appendix 1) [Clause 22.1] (10) Employer’s Representative issues Interim Payment Certificate within 14 days of receipt of payment claim [Clause 22.2] (11) Interim payment certificate or final payment certificate issued by the Employer’s Representative shall be deemed the payment response from the Employer under the SOP Act if the Employer does not provide any response within 21 days of service of payment claim. Where the Employer provides a payment response within 21 days of service of payment claim, such response shall take precedence over the interim payment certificate or final payment certificate [Clause 22.4] (12) Application for final payment claim by Contractor to issuance of final payment certificate by the Employer’s Representative is regulated by a procedure [Clause 24] (13) Claims for additional payment are regulated by a claims procedure [Clause 29] (14) Employer may at his convenience at any time to terminate the Contract without cause [Clause 30.1] (15) Contractor entitled to suspend work pursuant to provisions of SOP Act [Clause 31.1] (16) Contractor entitled to serve Notice of Termination following failure of payment of adjudicated amount by Employer [Clause 31.2] (17) Upon issuance of a Notice of Taking Over, Employer may take over design and construction of a part of the Works where termination for default is not practical as a default may relate to a specific part only [Clause 32] (18) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 33] (19) Additional optional clause permit fluctuations on specified materials used for permanent works only [Clause 34] (20) Option Module (with Employer’s Architectural Design) where the Employer retains his own design consultants to provide the architectural design works and make the statutory submissions FIDIC Conditions of Contract for Construction for Building and Engineering Works designed by the Employer (1) Documents forming the Contract are accorded a sequence of priority for purposes of interpretation [Clause 1.5] (2) Administration of the Contract and supervision of the execution of the Works are carried out by the Engineer appointed by the Employer [Clause 3.1]
(3) Provision is made for the Contractor to design the Works to the extent specified in the Contract [Clause 4.1] (4) Contractor is obliged to submit detailed time programme within 28 days from receipt of notice of the Commencement Date [Clause 8.3] (5) Employer may take over any part of the Works upon issue of a Taking-Over Certificate by the Employer [Clause 10.2] (6) Employer is entitled to an extension of the Defects Notification Period (by not more than two years) if the Works or a Section thereof cannot be used by reason of a defect or damage [Clause 11.3] (7) Contractor may submit to the Engineer value engineering proposals to accelerate completion, reduce cost of construction, maintenance and operation, or improve efficiency or value to the Employer [Clause 13.2] (8) Quantities in the Bill of Quantities are estimated quantities [Clause 14.1] (9) Provision for advance payment to the Contractor upon submission of an Advance PaymentGuarantee, if Employer agrees [Clause 14.2] (10) Amount certified in Interim Payment Certificate is paid by the Employer within 56 days from receiptof the Contractor's Statement and supporting documents [Clause14.7] (11) Employer is entitled to terminate the Contract without cause at any time for his convenience subject to certain provisions [Clause 15.5] (12) Insuring party is the Contractor unless otherwise stated in the Particular Conditions that the Employer wishes to effect insurances [Clause 18.2] (13) Provision is made for disputes to be adjudicated by a Dispute Adjudication Board [Clause 20] (14) Claims for additional payment and extension of time are regulated by a claims procedure which inter alia, requires the Engineer or Employer to respond within a given time period [Clause 20]
STANDARD FORMS (PUBLIC SECTOR) MAIN FEATURES Public Sector Standard Conditions of Contract for Construction Works (PSSCOC) (1) Superintending Officer, Superintending Officer’s Representative and assistants to Superintending Officer and Superintending Officer’s Representative are appointed for design, cost control and contract administration [Clause 2] (2) Failure to comply with the Superintending Officer’s instructions entitles the Employer to recover any cost, loss, expense and damage incurred inemploying another contractor and any other loss or damage as a result of the Contractor’s default [Clause 2] (3) Contractor must provide a security deposit (either as cash deposit or guarantee from a bank or Monetary Authority of Singapore approved insurer) within 14 days from letter of acceptance or such other longer period as stated in Appendix [Clause 4.5] (4) Employer may provide geotechnical information but it does not relieve the Contractor from carrying his own investigation or search for existing and other additional relevant information [Clause 5.1] (5)
If Contractor encounters adverse physical conditions (which include unforeseen sub-surface and ground conditions and underground services), he may be granted extension of time and loss and expense provided such conditions could not have been reasonably foreseen by an experienced contractor [Clause 5.2]
(6) Superintending Officer has express power to suspend the Works, and if suspension is more than 90 days, Contractor may regard it as omission of the affected part (which is suspended) or a termination (where the suspension affected the whole Works) [Clause 13] (7) If progress or completion of the Works will be delayed, Contractor has to notify the Superintending Officer within 60 days of occurrence of the delaying event [Clause 14.3] (8) Superintending Officer may require the Contractor to submit quotation for any proposed variation before issuing an instruction [Clause 19.3] (9) Superintending Officer has 60 days from the date of certified substantial completion of the variation works to value the amount due and notify the Contractor [Clause 20.2(2)] (10) Provision is made for Contractor to recover loss and expense as a result of regular progress and/or completion of the Works having been disrupted, prolonged or materially affected by variation instructions, failure to give site possession, suspension, late supply of information, Superintending Officer’s instructions (which Employer is liable to pay loss and expense),unforeseeable adverse physical conditions, acts or omissions of other contractors and Employer’s act of prevention or breach of contract [Clause 22]
(11) Superintending Officer has power to certify amounts payable to the Contractor for all work executed until termination (where such termination is without default of the Contractor) and any loss and expense suffered by the Contractor [Clause 31.4] (12) Superintending Officer has to issue a Payment Certificate to the Contractor within 14 days of receipt of a Payment Claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) [Clause 32.2(1)] (13) Payment Certificate issued by Superintending Officer shall be deemed the Payment Response from the Employer under the Building and Construction Industry Security of Payment Act if the Employer does not provide any response within 14 days from the Payment Claim [Clause 32.2(2)] (14) Where the Employer provides a Payment Response within 14 days from the Payment Claim, such response takes precedence over the Superintending Officer’s Payment Certificate [Clause 32.2(2)] (15) Contractor has 90 days from the Date of Substantial Completion to submit Final Payment Claim which shall constitute a Payment Claim under the Building and Construction Industry Security of Payment Act [Clause 32.4] (16) Superintending Officer has 21 days from receipt of Final Payment Claim to provide Contractor with an Interim Final Account and at the same time issue a Payment Certificate [Clause 32.5(1)] (17) Where Contractor fails to submit a Final Payment Claim, Superintending Officer has 150 days from the Date of Substantial Completion to issue Interim Final Account, and a further 30 days thereafter to issue a payment certificate. Interim Final Account and payment certificate under such circumstances are not subject to the Building and Construction Industry Security of Payment Act [Clause 32.5(2)] (18) Mechanism for fluctuation of materials prices applicable to specified materials in Appendix [Clause 33] (19) Any dispute or difference which involves a Payment Claim or Payment Response to which the Building and Construction Industry Security of Payment Act applies, entitles the Contractor to make an adjudication application [Clause 35.5(1)] (20) Employer can only recover from the Contractor any sum due or to become due under this contract (and not from any other contract between the Employer and the Contractor) [Clause 36.1] Public Sector Standard Conditions of Contract for Design and Build (PSSCOC D&B) (only main features which differ from the ‘Build’ form are highlighted below) (1) Contractor is responsible for choice of plant, materials, goods, workmanship and coordinating all design work [Clause 4.1] (2) Contractor to engage and include all fees, costs, etc in the Contract Sum for suitable qualified personnel viz, Registered Inspector, Resident Engineer and any others as required by statute; such persons cannot be replaced without prior consent of the Superintending Officer [Clause 4.2]
(3) Contractor must indemnify the Employer against all claims and proceedings for infringements of any patent rights, design, trademark name or copyright [Clause 4.6] (4) Contractor warrants that the Contractor’s Proposals meet the Employer’s Requirements and are fit for the purpose [Clause 6.1] (5) Contractor indemnifies the Employer for any breach of design responsibility in contract and under common law [Clause 6.1] (6) When the Works are substantially completed and the Temporary Occupation Permit obtained, Contractor gives notice plus an undertaking to complete any outstanding work during the defects liability period; Superintending Officer has 21 days from the notice to either issue certificate or instructions on works still to be completed [Clause 17] (7) No provision for Named Sub-Contractors
CONTRACTUAL ARRANGEMENTS Contractual arrangements are concerned with the typeof agreement to be entered into and the obligations,responsibilities, rights and liabilities assumed by the parties under a contract. It deals with the situation that exists from the time when a contract is formed until the time when all the obligations created by it have been discharged. Contractual arrangements may comprise the following: Conventional Contracts The commonest form of contract is one based upon the SIA Conditions of Contract. The design is prepared bya Consultant and the price of the works determined before award, usually by competition but occasionallyby negotiation. Small projects tend to be based upon specification and drawings whilst large projects are usually based upon bills of quantities. Design and Build Contracts A design and build contract is a contractual arrangementwhere the Employer employs a Contractor to design and build the project. The Contract Sum is inclusive of design work,management and construction costs. Develop and Construct Contracts A develop and construct contract is a contractual arrangement where the Employer engages consultants to design the project to a certain stage; the Contractor then develops and completes the design and constructs the building. Term Contracts Under term contracts, the Contractor signs a contract to carry out an indefinite amount of work within a certain framework over a time period or ‘term’. While exactly what is to be done may be uncertain, the generalcharacter of the work will usually be fairly easy to define. Orders for work are issued progressively from timeto time throughout the contract period. The work is measured, valued and the Contractor is paid accordingly subject to the tendered adjustment on the Schedule of Rates. Guaranteed Maximum Price (GMP) Contracts A GMP, effectively a guaranteed lump sum price for a project, is a set of conditions that can be introduced and used in conjunction with any standard form of contract, e.g. SIA Standard Form (for traditional procurement),JCT Standard Form with Contractor's Design or REDAS Design and Build Standard Form (for designbuild procurement) and JCT Management Contract Standard Form (for management contracting). It is not a standard form of contract. The guaranteed price is not subject to upward adjustment except for fundamental and material changes in the client scope of work or as a result of legislation or statutory requirements.
The benefits of GMP include greater price certainty, early start as design and construction can overlap, contractor's input and contribution on buildability, best practice construction methods and mutually beneficial partnering-style relationship. Management Contracts A management contract is one in which the Management Contractor is appointed to manage the planning and construction of a project and in which the construction work is executed by SubContractors working under him, selected and appointed as the job proceeds. The Management Contractor prepares the programme, decides on the contents of each work package to be sub-contracted, organises and manages the construction of all works which are undertaken by Sub-Contractors, each selected in competition. Construction Management Contracts Construction management contracts entail an interactive procurement concept involving combined efforts of the Employer, Construction Manager, design consultants and multitude of work package contractors. Under construction management contracts, theConstruction Manager is appointed to manage the entire delivery process from inception to completion while construction work is executed by a myriad of work package contractors engaged by the Employer, selected and appointed as the job proceeds. Public-Private Partnership (PPP) Public-Private Partnership (PPP) is a generic term whichdescribes the various structures possible whereby the public and private sectors work together in the delivery of services and the provision and operation of assets. Typical forms of project structures under PPP include PFI (Private Finance Initiative), DBFO (Design, Build, Finance, Operate), DCMF (Design, Construct, Manage, Finance), BOO (Build, Own, Operate), BOT (Build, Operate, Transfer) and BOOT (Build, Own, Operate, Transfer). Broadly, a typical PPP model involves the procuring authority (or public agency) contracting with the Special Purpose Vehicle (SPV) under a long-term service purchase agreement for the design, construction,maintenance and operation of the facility. The SPV enters into a range of subcontracts for the building works, and operations and maintenance of the new asset.
PREAMBLES The construction costs for the respective categories given on the following pages are average costing at 4th Quarter 2011. They are based on interpolation of competitive tenders received. The construction cost serves as a guide for preliminary cost appraisals and budgeting. It must be understood that the actual cost of a building will depend upon the design and many other factors such as major infrastructure of the buildings/structures, etc. and may vary from the figures shown. The costs per square metre are basedon construction floor areas measured to the outside face of the external walls/external perimeter including liftshafts, stairwells, plant rooms, water tanks and the like. As a guide, it might be worth to note that construction costs generally may vary accordingly depending on the following specific requirements: a. Complexity of the project b. Site encumbrances c. The need of special structural such as heavy transfer structures over MRT/RTS structures/tracks/boxes, etc. or due to close proximity to nearby infrastructure such as canals, bridges, etc. d. The types of structural system (i.e. reinforced concrete or structural steel system, precast/prefabrication, etc.) e. The types of temporary works required (i.e. diaphragm walls, sheet piling, etc.) f. The method of construction e.g. conventional or top down g. Basement works which are carried out in phases may require additional temporary works and different types of construction sequence h. Deep basement (i.e. levels of basement) i. Selection of Contractor (i.e. local or foreign) j. Shape of the existing site as longish sites would generally attract higher cost due to higher wall to floor ratio k. The level of Green Mark rating All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normalsoil conditions and minimal external works. The costs exclude the following: • Professional fees • Authorities’ plan processing charges • Land cost • Financing charges • Site inspectorate
CURRENT CONSTRUCTION REGULATIONS BCA Contractors Registry System (CRS) The Contractors Registry was established in 1984 to register contractors who provide construction-related goods and services to the public sector. Contractors who wish to be registered with the Registry must show that they have the relevant experience, financial, technical and management capability. The table below summaries the registration requirements for general building (CW01) and civil engineering works (CW02): GRADE (PLEASE REFER TO NOTE: 1)
A1
A2
B1
B2
FINANCIAL (MIN PAID-UP MANAGEMENT & CAPITAL & MIN NET DEVELOPMENT WORTH)
$15.0m
$6.5m
$3.0m
$1.0m
TRACK RECORD (PAST 3 YEARS)** CW01
Note: ADDITIONAL REQUIREMENTS
CW02
24RP/P/T incl min 8RP ISO9001:2008 (SAC) ISO14000 OHSAS18000/ SS506 Part 1
$150.0m
$150.0m
of which
of which
$75.0m PS
$75.0m PS
$112.5m MC
$75.0m MC
$37.5m SP
$37.5m SP
12RP/P/T incl min 4RP ISO9001:2008 (SAC) ISO14000 OHSAS18000/ SS506 Part 1
$65.0m
$65.0m
of which
of which
$32.5m PS
$32.5m PS
$48.75m MC
$32.5m MC
$16.25m SP
$16.25m SP
6RP/P/T incl min 2RP ISO9001:2008 (SAC) OHSAS18000/ SS506 Part 1 ISO14000 (by 1 Jul 13)
$30.0m
$30.0m
of which
of which
$22.5m MC
$15.0m MC
$7.5m SP
$7.5m SP
3RP/P/T incl min 1RP ISO9001:2008 (SAC) OHSAS18000/ SS506 Part 1 ISO14000 (by 1 Jul 13)
$10.0m
$10.0m
of which
of which
$7.5m MC
$5.0m MC
$2.5m SP
$2.5m SP
C1
$300,000
1P + 1T SMC
$3.0m
$3.0m
C2
$100,000
1P or 2T SMC
$1.0m
$1.0m
C3
$25,000
1T
$100,000 (Please refer to Note: 14)
$100,000 (Please refer to Note: 14)
i) Annual submission of financial accounts and certified VAP calculation ii) Annual submission of CET declaration iii) General Builder Licence Class 1 (GB1) i) Annual submission of financial accounts and certified VAP calculation ii) General Builder Licence Class 1 (GB1)
1) Please refer to Page 131 for the tendering limits 2) m stands for million 3) Both minimum (min) paid-up capital and minimumnet worth must be met. C3 firms are required to submit the latest management accounts (not more than 12 months old) 4) PS – projects executed in Singapore 5) MC – main contracts (nominated sub-contracts may be included) 6) SP – minimum size single project 7) Percentage of sub-contract value taken into consideration shall be 50% for CW01 and 75% for CW02 8) RP – Professional with relevant qualifications from universities recognised by PEB, BOA or BCA P/T – Professional and Technical personnel with relevant qualifications 9) PEB – Professional Engineers Board of Singapore 10) BOA – Board of Architects of Singapore 11) ISO 9001:2008 must be SAC accredited i.e. the certificate to bear the SAC logo
General Builder Licence Class 2 (GB2)
Source: Building and Construction Authority as at August 2011
12) SMC (Safety Management Certificate awarded by BCA) or OHSAS 18000 required for C1 and C2 13) CET – The continuing education and training (CET) requirement has been implemented since 1 November 2010. In order to retain their respective grades (i.e. A1 and A2), each registered personnel is required to complete 14 hours of structured CET courses annually over a 12-month period from 1 November to 31 October (of the next calendar year). 14) With effect from 1 February 2012, entry grade C3 will require completed or on-going track recordof $100,000 for new, renewal and upgrading applications. For companies with insufficient track record, an interview with the technical personnel (conducted at BCA office) will be required.
**For renewal cases of grades A1 to C2, projects completed satisfactorily in the past 5 years including on-going projects and recently awarded projects will be considered as track record. For CW02-A1 registration, projects completed satisfactorily in the past 5 years can be considered as track record. For evaluation of overseas projects and financial accounts, BCA may send its officers to the respective countries for further verification. All flight and accommodation expenses shall be fully borne by the applicant. In June 2006, BCA adopted a credit rating system to indicate the financial standing of larger construction firmsin its Contractors Registry. The adopted credit ratingsystem is similar to one developed by credit and business information bureau DP Information Group to assess thefinancial health of companies. However, the BCA system applies only to the larger construction companies (i.e. those in the top categories of A1, A2 and B1). Government agencies will use the DP credit rating as an additional reference on the financial standing of the firms when evaluating public tenders.
CURRENT CONSTRUCTION REGULATIONS New Tendering Limits for BCA Registered Contractors In 2002, BCA launched a Tender Limit VariableComponent (TLVC) to the tender limits of all registration grades in the Contractors Registry System (CRS). TLVC is determined using the Tender Price Index (TPI) to reflect the impact of tender price movements on project value. Over the years, the TPI has moved up significantly, hence resulting a need to adjust the tender limits of the various CRS registration grades to better reflect the fluctuations in the construction costs in the market. In November 2007, BCA announced that the tendering limits will be adjusted once a year on the first of July. The current new tendering limits shown below are based on the latest TLVC updated on 23 May 2011. CONSTRUCTION WORKHEADS (CW01 & 02)
A1
A2
B1
B2
C1
C2
C3
Tendering limit ($million) 1 Jul 10 to 30 Jun 11
Unlimited
85.0
40.0
13.0
4.0
1.3
0.65
Tendering limit ($million) 1 Jun 11 to 30 Jun 12
Unlimited
85.0
40.0
13.0
4.0
1.3
0.65
L6
L5
L4
L3
L2
L1
Tendering limit ($million) 1 Jul 10 to 30 Jun 11
Unlimited
13.0
6.5
4.0
1.3
0.65
Tendering limit ($million) 1 Jul 11 to 30 Jun 12
Unlimited
13.0
6.5
4.0
1.3
0.65
SPECIALIST WORKHEADS (CR, ME, MW & SY)
Source: Building and Construction Authority as at 23 May 2011
CURRENT CONSTRUCTION REGULATIONS Man-Year Entitlement (MYE) The Man-Year Entitlement (MYE) system is a work permit allocation system implemented by the Ministry of Manpower (MOM) in April 1998. Under this system, main contractors are given entitlements to employ foreign workers from Non-Traditional Sources and the People’s Republic of China either directly or indirectly from their sub-contractors based on the nature and value of their projects. To reduce the construction industry’s heavy reliance on foreign workers and to raise the productivity levels, MOM has been tightening the MYE formula so as to meet the Construction 21 (C21) targets for MYE to be further reduced to 70% of 1999-level by 2005 and eventually to 50% of 1999-level by 2010, or earlier. In line with the C21 blueprint, MOM has since implemented MYE cuts/adjustments as follows: June 2002 • 70% of 1998 MYE level for all upgrading projects • 80% of 1998 MYE level for all civil engineering projects • 65% of 1998 MYE level for all building projects below S$10 million • 60% of 1998 MYE level for all building projects at or above S$10 million December 2004 • Based on the feedback given by the industry, MYE allocation was increased by 10% of 2002 MYE level for all new and ongoing construction projects January 2007 • 5% reduction from 2004 MYE level for all projects except for projects above $100 million April 2007 • 5% restoration of January 2007 MYE level for all new and ongoing projects except for projects above $100 million In March 2010, the Singapore Government made an announcement that, with effect from 1 July 2010, there will be progressive reduction in the MYE in phases, leading to a cumulative 25% cut in MYE allocation by July 2012, details as follows: • Reduce MYE by 25% over 3 phases - 1 July 2010 = 5% - 1 July 2011 = 10% - 1 July 2012 = 10% The tabulation below illustrates the MYE allocation for different project values applied during the respective periods:
PROJECT VALUE
BUILDING PROJECTS
UPGRADING PROJECTS
CIVIL ENGINEERING PROJECTS
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
$400,000
0
0
0
0
0
0
$600,000
12
11
18
16
5
5
$7,000,000
94
84
126
113
38
35
$15,000,000
158
142
229
206
70
63
$25,500,000
237
213
345
310
105
95
$35,000,000
296
266
430
387
129
116
$140,000,000
772
695
1,081
973
237 at least*
214 at least*
Source: Ministry of Manpower as at 1 July 2011 *For CE Projects with contract value above $100 million, the MYE are to be decided on a case-by-case basis.
The Government have made an announcement on 21 February 2011 that there will be a further 15% cut in the MYE quota for new projects in July 2013.
CURRENT CONSTRUCTION REGULATIONS Minimum Buildable Design Score The legislation on buildability came into effect on 1 January 2001. Projects submitted for planning after 1 January 2001 will be affected by the legislation and are required to comply with a minimum buildable design score as stipulated in the Code of Practice on Buildability. Over the years, the minimum buildability scores have been progressively raised. In September 2005, all new building projects with gross floor area equal or greater than 2,000m2 are required to comply with the minimum buildability score. The minimum buildability score requirement shall also apply to A&A work to an existing building if the building works involve the construction of new floor and/or reconstruction of existing floor for which their total gross floor area is 2,000m2 or more. The Code of Practice on Buildability (April 2011) has stipulated the minimum buildable design score for building works with applications for planning permission made on or after 15 July 2011 for different building types: CATEGORY OF BUILDING WORK / DEVELOPMENT Residential (landed) Residential (non-landed) Commercial Industrial School Institutional and Others
MINIMUM BUILDABLE DESIGN SCORE 2,000m2 ≤ GFA < 5,000m2 60
5,000m2 ≤ GFA < 25,000m2 65
GFA ≥ 25,000m2 68
57 (for A&A work within existing building) 67
72
75
60 (for A&A work within existing building) 69
74
77
62 (for A&A work within existing building) 69
74
77
62 (for A&A work within existing building) 64
69
72
60 (for A&A work within existing building) 60
66
69
60 (for A&A work within existing building)
Source: Building and Construction Authority
CURRENT CONSTRUCTION REGULATIONS Constructability Score To steer the construction industry towards higher level of productivity, the Building and Construction Authority (BCA) would be tightening the existing BuildabilityFramework and mandating a new component called Constructability Score. In this connection, contractors would be expected to adopt more labour-efficient construction methods or technologies. The constructability requirement would apply to all planning permissions submitted on and after 15 July 2011. This extends to all new building works and projects involving repairs and Addition & Alteration Works to existing buildings with GFA of 5,000m2 or more. The Constructability Score of a project is made up of 3 parts :• Part A – Maximum of 60 points for Structural System. Points are awarded for various methods and technologies adopted during the construction of structural works • Part B – Maximum of 50 points for Architectural, Mechanical, Electrical and Plumbing (AMEP) Systems. Points are awarded for various methods and technologies adopted during the construction of AMEP works • Part C – Maximum of 10 points for Good Industry Practices. Points are awarded for good industry practices adopted on site to improve productivity Under the BCA’s Code of Buildability (April 2011), the minimum Constructability Score requirements and minimum score under the Structural System component are allocated as follows: CATEGORY OF BUILDING WORK / DEVELOPMENT
MINIMUM CONSTRUCTABILITY SCORE 5,000m2 ≤ GFA < 25,000m2
GFA ≥ 25,000m2
Residential (landed) Residential (non-landed) Commercial Industrial
40 (Minimum 25 points from Structural System)
School Institutional and Others
Source: Building and Construction Authority
50 (Minimum 35 points from Structural System)
CURRENT CONSTRUCTION REGULATIONS Earth Control Measures Public Utilities Board (PUB) has amended its Code of Practices on Surface Water Drainage* to provide comprehensive guidelines on how the industry can apply more effective erosion and sedimentation control measures, this came into force in October 2006. The Code of Practice on Surface Water Drainage contains information pertaining to the basic planning, design and procedural requirements for surface water drainage, and specifies the minimum engineering requirements for the provision of functional facilities for surface water drainage. This Code of Practice is issued under Section 32 of the Sewerage and Drainage Act (Chapter 294). As part of our commitment of excellent service to our clients, DLS has responded to the amendments with changes in our contractual clauses and front-end documents. *Code of Practice on Surface Water Drainage (Fifth Edition – with amendments under Addendum No. 4 – September 2006)
CURRENT CONSTRUCTION REGULATIONS Building Control Act (Chapter 29) The salient features incorporating the (Amendment) Act 2007 are highlighted below:
Building
Control
Require Site Supervision Teams to ensure adequate Supervision of Structural Works Under this new requirement, both the Qualified Person (QP) and the Builder are required to provide their own supervision team. The actual number and compositions of the supervision team will depend on the project costas prescribed in the Regulations. Appointment ofsupervision teams will be required for projects where the first application for a permit is made on or after the effective date of the Act. While this supervision team does not apply to projects which had already obtained a permit earlier, QPs are nonetheless encouraged to adopt the supervision team where necessary. Strict Regulation on Major Geotechnical Works The Act imposes more stringent regulation of major underground building works that have significant safety impact, in particular on the design of Earth Retaining or Stabilising Structures (ERSS) in excavations. The Act stipulates that the design of such ERSS be carried out by a Registered Professional Engineer (PE) and reviewed by a Registered Accredited Checker (AC). A PE is also required to supervise the construction of ERSS. In addition, the geotechnical aspects of major under-ground building works including ERSS in excavations more than 6m deep, will also require the inputs from PEs and ACs who are specialists in geotechnical engineering. Appointment of Instrumentation Specialist Builder (ISB) The Developer of the building works shall appoint a Specialist Builder to monitor instruments measuring pore pressures for saturated and unsaturated levels, ground water levels and ground movements or building movements where the building works comprise wholly or partly of any underground building works. Underground building works generally mean thefollowing: • A tunnel with a diameter or height of more than 2 metres • Excavation with a depth of more than 6 metres • Foundation works for buildings of 30 or more storeys high Any of the above case would require the appointment of an ISB and the Act stipulates that the appointment shall be made by the Developer. Licensing of Builders This is a licensing scheme to set minimum standards of professionalism for general builders and six selective specialist builders whose works have significant safety impact.
To be licensed, builders must be financially sound, have good safety records and appoint key personnel with suitable qualifications and experience to manage the firm and supervise the construction works. The licensing of builders came into effect on 16 December 2008. There was a grace period of six months (till 16 June 2009) for builders to apply for the licence. There are two types of licence – the General Builder licence and the Specialist Builder licence. After 16 June 2009, all builders who had been granted or to be granted a permit to carry out general building works, as well as builders carrying out work in the six selective specialists work areas must possess a licence issued by the Commissioner of Building Control. With effect from 15 April 2011, BCA has increased the number of key construction trades under CoreTrade from seven (7) to seventeen (17) to enable the building up of a larger pool of higher skilled and experienced workers. In addition, the following shall apply to construction projects for which the permits to commence structural works are submitted to BCA from 15 October 2011 :• There will be 4 project categories (instead of 3) under CoreTrade, in recognition of the distinct manpower needs of “conventional” Civil Engineering (CE) works and CE works involving MRT stations: - New Building Works - Addition & Alteration (A&A) Works - Civil Engineering Works (General) - Civil Engineering Works (MRT Station) • Increasing the CoreTrade Man-Year deployment requirements Class 1: Unlimited
Paid up capital: Not less than $300,000
LICENSING OF BUILDERS General Builders
Specialist Builders
Class 2: $6mil limit
Paid up capital: Not less than $25,000
Approved Person
Notes:1. Class 1 Builders with project contract value of more than $20mil have to submit to the Commissioner of Building Control a manpower program showing the deployment of CoreTrade personnel for the duration of the project.
2. Deployment requirements for 3 classes of projects:a. New Building Works b. A&A Works c. Civil Engineering Works (General) d. Civil Engineering Works (MRT Station)
Commence 16 Dec 08
Technical Controller
Six Categories 1. Piling Works 2. Ground Works 3. Site Investigation Works 4. Structural Steelworks 5. Pre-cast Concrete Works 6. In-situ Post-tensioning Works Criteria 1. Sole Proprietor 2. Partner 3. Director
CORETRADE Tradesmen 1. Construction Plant Operation Works 2. Electrical Works 3. Plumbing & Piping Works 4. Tiling, Stone Laying & Floor Finishing Works 5. Reinfored Concrete Works 6. Structural Steelworks 7. Waterproofing Works 8. Cladding & Curtain Wall Installation 9. Glazing Works 10. Drywall Installation 11. Suspended Ceiling Installation 12. Doors & Windows Installation 13. Joinery Works 14. Air-con Ducting Installation 15. Fire Protection Works 16. Gas Pipefitting Works 17. Lift Installation
Implementation Phase
Trade Foremen 1. Electrical Works 2. Plumbing & Piping Works 3. Tiling, Stone Laying & Floor Finishing Works 4. Waterproofing Works 5. Reinfored Concrete Works 6. Structural Steelworks 7. Waterproofing Works 8. Cladding & Curtain Wall Installation 9. Glazing Works 10. Drywall Installation 11. Suspended Ceiling Installation 12. Doors & Windows Installation 13. Joinery Works 14. Air-con Ducting Installation 15. Fire Protection Works 16. Gas Pipefitting Works 17. Lift Installation
Transition Phase till 16 Jun 09
• Administrative expenses • Legal costs and disbursements • Demolition of existing building/s • Furniture, fittings and equipment (F.F. & E.) (unless otherwise stated) • Operating equipment • Cost escalation • Goods and Services Tax The codes and standards for each category of building vary from country to country and do not necessarily follow those of Singapore.
Registration of CoreTrade Personnel With effect from 16 June 2009, all Class 1 General Builders* undertaking a project of value which is $20 million or more will be required to deploy a prescribed minimum number of construction personnel who are registered under the CoreTrade Scheme. The objective of this new requirement is to build up a core group of locals and experienced foreign workers in key construction trades to anchor and lead the workforce. *Class 1 General Builder licence allows the holder to carry on the business of a general builder for any project. Enhance Independence of Parties in Construction Projects To avoid any situations of conflicts on interest, the Act imposes restrictions to insulate the QP and Contractor supervising the structural works from the influence of the developer or builder by requiring that the QP responsible for supervision should not be associated with the developer or builder. Standards on Environmental Sustainability Please refer to Page 147 for details .Maintenance of Barrier-Free Provisions Please refer to Page 162 for details. Stiffer Penalties for Non-Compliance The penalties provided in the new Act are set at a higher level than those found in the previous Act in order to align them with the relevant provisions of the Workplace Safety and Health Act (WSHA). Statutory Duty on Developers to Report AnyContravention of the Building Control Act and Regulations to the Commissioner of Building Control(CBC) Under the Act, the developer, who is one of the key parties in the project, has a duty to report to the CBCof any contravention of the Building Control Act/Regulations relating to the project that he knows or ought reasonably to know. Mandatory Higher Green Mark Standard forGovernment Land Sales (GLS) Sites in Selected Strategic Areas It was announced in BCA’s 2nd Green Building Master-plan in 2009 that projects developed on GLS sites in the selected strategic growth areas will be subject to higher Green Mark standards. This requirement aims to maximize the potential for cost-effective energy savings in our built environment. Any new development located on land sold on or after 5 May 2010 under the GLS Programme in the following strategic areas will be required to be designed to meet the prescribed Green Mark certification:
SELECTED STRATEGIC AREAS REQUIREMENTS FOR BUILDING WHOLLY Exact Location to refer to the Building OR PARTLY WITHIN AREA THAT IS ON Control (Environmental Sustainability) LAND SOLD UNDER THE GLS Regulations 2008 PROGRAMME Marina Bay
Green Mark Platinum
Downtown Core – including areas within the CBD located next to Marina Bay Jurong Lake District
Green Mark GoldPLUS
Kallang Riverside Paya Lebar Central
Source: Building and Construction Authority as at 10 December 2010 For building works that are subject to this requirement, the QPs need not submit their declaration of the Green Mark scores along with the building plan submission. Instead, the QPs should ensure that, prior to the building plan submission, an application is made to BCA for the project to obtain the Green Mark Certification in accordance with the BCA Green Mark Certification Standard for New Buildings. Upon completion of the building works, the QPs should submit the Green Mark Certification rating achieved for the project along withhis application for Temporary Occupation Permit(TOP) or Certificate of Statutory Completion (CSC).The prescribed Green Mark Certification rating for the building has to be obtained before a TOP/CSC can be granted. The certification standard has been revised from 1 December 2010 in tandem with the changes in the Green Mark Criteria. The compliance with the respective certification standards will be based on the tender award letter issued by the Urban Redevelopment Authority (URA) to the successful developer under the GLS Programmes for the selected strategic areas and as stated in the table below: DATE OF TENDER CLOSED UNDER THE GLS PROGRAMMES
COMPLIANCE STANDARD
From 5 May 2010 to 30 November 2010
BCA Green Mark Certification Standards for New Building, GM Version 3.0, May 2010 issue
From 1 December 2010 and onwards
BCA Green Mark Certification Standards for New Building, GM Version 4.0, August 2010 issue
Source: Building and Construction Authority as at 10 December 2010 Green Mark Version 4.0 for New Buildings On 31 August 2010, BCA announced that the Green Mark (GM) Criteria will be revised to raise the standards of environmentally friendly buildings in Singapore. This is a step forward in achieving the target of “greening” 80% of the existing buildings stock by 2030. The revised BCA GM Criteria for new buildings (Version 4.0) will be implemented with effect from 1 December 2010. Some of the key changes include enhance pre-requisites for higher GM rating, increase in focuson passive designs, sustainable construction practices, introduction of carbon footprint and a minimum 10% energy improvement as compared to Version 3.0.
An extract on the implementation timelines of BCA GM Criteria Version 4.0 in other green building initiatives are outlined in the table below: GREEN BUILDING INITIATIVES
IMPLEMENTATION TIMELINE
Government Land Sales (GLS) Programmes
Based on the GLS tender close date.
Green Mark Gross Floor Area (GM-GFA) Incentive Scheme
Based on the submission date of BCAGM-GFA application.
Projects with tender closing date on or after Any new development located on land sold 1 December 2010 will be assessed and under the GLS are required to attain Green certified using the Revised BCA Green Mark Mark GoldPLUS or Platinum Rating. Criteria for new buildings (GM Version 4.0).
Incentives in the form of additional GFA can Projects with applications submitted on or be granted by URA if development attains after 1 December 2010 will be assessed and certified using the Revised BCA Green Green Mark GoldPLUS or Platinum Rating. Mark Criteria for new buildings (GM Version 4.0). Public Sector Taking the Lead
Based on the date of tender notices for the consultancy or design and build contract.
New public sector buildings with more than 5,000m2 air-conditioned floor area are The revised BCA Green Mark Criteria for required to attain the Green Mark Platinum new buildings (GM Version 4.0) will be applicable to public sector projects with Rating. tenders for design that are called on or after 1 December 2010.
Source: Building and Construction Authority’s Circular dated 31 August 2010
More information on the Revised BCA Green Mark Criteria for New Buildings (Version 4.0) can be found in BCA’s website. (http://210.23.8.172/einfo/Uploads/Circular/CBCA100902.pdf)
CURRENT CONSTRUCTION REGULATIONS Green Mark Incentive Scheme for Existing Building (GMISEB) GMIS-EB was introduced by BCA in April 2009. The Scheme aims to encourage private building owners to undertake improvements and/or retrofits to their existing buildings to achieve substantial improvement in energy efficiency. It provides a cash incentive that co-funds up to 35% (capped at $1.5 million) of the costs of energy efficient equipment installed for energy efficiency improvement in their existing buildings. In addition, it will also co-funds up to 50% of the cost for conducting a energy audit (Health Check scheme) on the efficiency of the air-conditioning plants. All building owners of private existing non-residential buildings with gross floor area of 2,000m2 and above with central chilled water air-conditioning plants or which will be graded to have central chilled water air-conditioning plants are eligible for application of the incentive. However, the eligible buildings must first achieve at least BCA Green Mark Certified rating and air-conditioning system efficiency of 0.7 kW/RT or better, with 15% energy savings or higher. The amount of co-funding for building owners will vary depending on the Green Mark rating, air-conditioning system efficiency and energy savings that are achieved. The amount of co-funding rate and cap amount are summarised as follow: GREEN MARK RATING
Certified Gold
AIRCON SYSTEM EFFICIENCY (KW/RT)
0.70
ENERGY SAVINGS
CO-FUNDING RATE BASED ON BASED ON (BASED ON TOTAL TOTAL EQUIPMENT BUILDING LANDLORD’S COST) CONSUMPTION CONSUMPTION 20%
25%
15%
20%
CAP
20%
$150,000
GoldPLUS
0.65
30%
35%
30%
$500,000
Platinum
0.60
35%
40%
35%
$1,500,000
Source: Building and Construction Authority as at 11 July 2011 The cash incentives will be disbursed in two stages. The first disbursement, set at 50% of the approved co-funding, will be given out upon completion of the energy improvement retrofits. The final disbursement of the approved co-funding will be given out upon Green Mark certification and verification of airconditioning plant system efficiency and the energy savings achieved. The scheme is applicable with effect from 29 April 2009 and will expire 5 years later on the 28 April 2014 or when the GMIS-EB fund is fully disbursed, whichever earlier. Participation in the scheme will be on a first-come-first served basis, subject to availability of funds. For more information on the Scheme, please refer to BCA’s website for more details.
Green Mark Gross Floor Area (GM GFA) Incentive Scheme The Green Mark Gross Floor Area (GM GFA) Incentive Scheme came into effect on 29 April 2009 for a periodof 5 years with a mid-term review after 2 years ofimplementation. The Scheme was introduced toencourage building owners/developers to acceleratethe adoption of environmental-friendly green building technologies and building design practices that will contribute to the sustainable development of Singapore. Building owners/developers can enjoy additional GFA allowed over and above the Master Plan (MP) Gross Plot Ratio (GPR) should their buildings achieve GM ratings of GoldPLUS and above. The quantum of GM GFA allowed under the Scheme is up to 1% for Green Mark GoldPLUS and up to 2% for Green Mark Platinum, subject to a cap of 2,500m2 for GoldPLUS and 5,000m2 for Platinum. Development that are eligible for the GM GFA Incentive Scheme includes: • Residential – non-landed, mixed commercial and residential development and others (approved on a case-by-case basis) • Non-Residential – commercial, office, retail, business parks, industrial, institutional, community building, hotel, hospital, white site development and others (approved on a case-by-case basis) • New private developments, redevelopments and reconstruction developments which includes major additions and alterations to existing buildings and major retrofitting to existing buildings as deemed suitable for the GM GFA incentive scheme at BCA’s sole discretion • Government Land Sales (GLS) sites, except for sites in which GM Platinum or GoldPLUS standards are mandated as part of the sales condition. For sites where the GoldPLUS standard is mandated, the developer will still enjoy an incremental GFA incentive if the developer attained the higher GM Platinum standard • Applicants who take up the GM GFA Incentive Scheme will not be eligible for the GMISThe method of determining the GM GFA is based on the following:
Equivalent Bonus GFA
Proposed GFA (sqm) = (subject to MP allowable intensity)
X
Prescribed Green Premium ($/sqm)
Land Value ($/sqm) (determined by proxy using DC rates) Note: The additional GFA is subject to payment of differential premium or development charge, whichever is applicable. For more information on the Scheme, please refer to BCA’s website for more details.
CURRENT CONSTRUCTION REGULATIONS Legislation on Environmental Sustainability for Buildings Since the launch of BCA Green Mark Scheme in 2005, BCA has enhanced the Building Control Act to include a minimum environmental sustainability standard that is equivalent to the Green Mark Certified Level for new buildings and existing ones that undergo major retrofitting. The Building Control (Environmental Sustainability) Regulations 2008 stipulates a minimum Green Mark score of 50 for affected building works. It applies to: • All new building works with Gross Floor Area of 2,000m2 or more • Additions or extensions to existing buildings which involve increasing Gross Floor Area of the existing buildings by 2,000m2 or more • Building works which involve major retrofitting to existing buildings with existing Gross Floor Area of 2,000m2 or more Alterations to existing buildings which does not involve major retrofitting works is not subject to the new requirements. The effective date of implementation will be based on the first submission date for URA Planning Permission on or after 15 April 2008. With effect from 1 December 2010, the minimumenvironmental sustainability standard has been revised. The compliance with the respective environmental sustainability standards will be based on the firstsubmission date for URA planning permission as stated in the table below:
1ST SUBMISSION DATE FOR URA PLANNING PERMISSION From 15 April 2008 to 30 November 2010 From 1 December 2010 onwards
COMPLIANCE STANDARD Code for Environmental Sustainability for Buildings, 1st Edition, April 2008 issue Code for Environmental Sustainability for Buildings, 2nd Edition, August 2010 issue
The requirements on environmental sustainability of buildings will be integrated with the Building Plan process. The Qualified Person (QP) who submits the Building Plan and the other appropriate practitioners will be responsible for assessing and scoring the building works under their charge using the criteria and scoring methodology spelled out in the Code for Environmental Sustainability of Buildings. Under the Legislation, Green Mark assessments are no longer required to be conducted as an independent third party certification. Compliance to the regulations will be based on QP’s declaration and random audit and site checks prior or during Temporary Occupation Permit (TOP).
However, third party assessment by BCA will be conducted to award projects with Green Mark Gold rating and above. The BCA Green Mark has assessment criteria for three main categories: • New Buildings • Existing Buildings and • Beyond Buildings New buildings refer to new developments,redevelopments, additions and alterations to existing buildings and major retrofitting to existing buildings. Existing buildings refer to buildings under operations with no significant retrofitting works. Lastly, beyond buildings refer to new parks design and development, existing parks, office interiors, infrastructure with no significant retrofitting works and district development. In line with the above new regulations, the BCA Green Mark Assessment Criteria for New Buildings has been revised and will take effect from 1 December 2010 onwards. All Green Mark applications for new buildings that are submitted on or after this date will be assessed and certified based on this new version. Append hereunder are the various Green Mark categories: • BCA Green Mark for Non-Residential New Buildings (Version NRB/4.0) Applicable for new buildings such as offices, commercial, industrial and institutional buildings with or without airconditioning systems. • BCA Green Mark for Residential New Buildings (Version RB/4.0) Applicable for new private and public residential developments. • BCA Green Mark for Non-Residential Existing Buildings (Version NREB/2.1) Applicable to existing commercial, industrial and institutional buildings under operation. • BCA Green Mark for Existing Residential Buildings (Version ERB/1.0) Applicable for existing private and public residential developments. • BCA Green Mark for Existing Schools (Version ES/1.0) Applicable to Ministry of Education main stream schools (excluding International schools, Universities and Institute of Higher Learning: Polytechnics and Institute of Technical Education.) • BCA Green Mark for Office Interior (Version 1.0) Applicable for tenant renovation and maintenance practices. • BCA Green Mark for Landed Houses (Version LH/1.0) Applicable for landed housing projects. • BCA Green Mark for Infrastructure (Version 1.0) Applicable for infrastructure projects (e.g. barrages, roads, bridges, etc.) • BCA Green Mark for District (Version 1.0) Applicable for district projects. • BCA Green Mark for Restaurants (Version 1.0) Applicable for restaurants.
The Green Mark rates the environmental friendliness of a building based on a point scoring approach. Depending on the score, the rating is categorized in four levels – Platinum, GoldPLUS, Gold and Certified GREEN MARK RATING
GREEN MARK POINTS GREEN MARK POINTS WITH EFFECT FROM WITH EFFECT FROM 1 DECEMBER 2010 1 DECEMBER 2009 VERSION 4.0 VERSION 2.1 NON-RESIDENTIAL & NON-RESIDENTIAL RESIDENTIAL BUILDINGS EXISTING BUILDINGS
Green Mark Platinum
90 and above
90 and above
Green Mark GoldPLUS
85 to <90
85 to <90
Green Mark Gold
75 to <85
75 to <85
Green Mark Certified
50 to <75
50 to <75
GREEN MARK RATING
GREEN MARK POINTS GREEN MARK POINTS WITH EFFECT FROM WITH EFFECT FROM 19 MAY 2011 4 AUGUST 2011 VERSION 1.0 VERSION 1.0 EXISTING RESIDENTIAL EXISTING SCHOOLS BUILDINGS
Green Mark Platinum
90 and above
90 and above
Green Mark GoldPLUS
85 to <90
85 to <90
Green Mark Gold
75 to <85
75 to <85
Green Mark Certified
50 to <75
50 to <75
GREEN MARK POINTS WITH EFFECT FROM 27 MAY 2009 VERSION 1.0 OFFICE INTERIOR & LANDED HOUSES
GREEN MARK POINTS WITH EFFECT FROM 27 MAY 2009 VERSION 1.0 INFRASTRUCTURE
GREEN MARK RATING
Green Mark Platinum
95 and above
90 and above
Green Mark GoldPLUS
85 to <95
80 to <90
Green Mark Gold
75 to <85
70 to <80
Green Mark Certified
50 to <75
50 to <70
GREEN MARK RATING
GREEN MARK POINTS WITH EFFECT FROM 29 OCTOBER 2009 VERSION 1.0 DISTRICT
PRE-REQUISITES
Green Mark Platinum
90 and above
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark Platinum
Green Mark GoldPLUS
80 to <90
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark GoldPLUS
Green Mark Gold
65 to <80
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark Gold
Green Mark Certified
50 to <65
Nil
GREEN MARK RATING
Green Mark Platinum
GREEN MARK POINTS WITH EFFECT FROM 12 SEPTEMBER 2011 VERSION 1.0 RESTAURANTS 95 and above
Green Mark Gold
85 to <95
Green Mark Gold
75 to <85
Green Mark Certified
50 to <75
PLUS
More information on the BCA Green Mark Scheme can be found in BCA’s website. (http://www.bca.gov.sg/GreenMark/green_ mark_buildings.html)
CURRENT CONSTRUCTION REGULATIONS BCA Green Mark Champion The Green Mark Champion Award established in May 2008 was an extension to the BCA Green Mark Award introduced in 2005. This new award was created to recognize developers/building owners with strong commitment towards corporate social responsibility and outstanding achievements in environmental sustainability. It is given to developers/building owners who achieve a substantial number of Green Mark buildings at Gold level and higher. There are 2 categories for the award: • BCA Green Mark Champion • BCA Green Mark Platinum Champion In addition to demonstrating strong commitment towards corporate social responsibility and environmentalsustainability, developers/building owners must also meet the minimum criteria set out below to qualify for the award:
TOTAL NO. OF BUILDINGS RATED
BCA GREEN MARK BCA GREEN MARK CHAMPION PLATINUM CHAMPION
Green Mark Gold and above
At least 10
At least 50
Green Mark GoldPLUS
At least 3
At least 15
Green Mark Platinum
At least 3
At least 15
Source: Building and Construction Authority
CURRENT CONSTRUCTION REGULATIONS Solar Capability Scheme (SCS) In May 2008, the Clean Energy Programme Office (CEPO) (now known as Energy Innovation Programme Office (EIPO)) of the Singapore Economic Development Board (EDB) announced the establishment of the SolarCapability Scheme (SCS). The primary purpose of this scheme is to encourage the use of solar energy systems in new developments, and also to build capacity within the local construction industry for the implementation of such systems. Under the scheme, building owners and developers may enjoy a grant of 30% - 40% of the capital cost (capped at $1 million per project) of installing solar energy systems in their new developments. It is estimated that savings from the electricity generated by these systems will allow the owner to recover a further 50% of the capital cost incurred. The initial budget for the scheme is $20 million, and the quantum of grant is expected to be reviewed on a regular basis to factor in changes in the prices of solar systems and energy prices. Eligibility for the SCS is restricted to new buildings that have attained a minimum Green Mark Gold standard (administered by the Building and ConstructionAuthority), while buildings undergoing extensive retrofit will be considered on a case-by-case basis. To qualify, a minimum system size of 10kWp is required. The following evaluation criteria determine the actual amount of the grant: a) Innovation - Innovative application of solar technologies - New products, technologies or solutions developed b) Design - Aesthetics of building and solar system design and integration - Integration of solar technologies in the building's sub-system c) Effectiveness - Cost effectiveness of solar solutions - Percentage of conventional electricity replaced d) Skill Development - Number of man-months of Singapore based staff involved in solar related activities in the project - Number of man-months of formal training Disbursement of the grant is conducted in 2 phases as follows: i. Capital Component: 70% of the grant to be disbursed from the start of the project on a reimbursement basis ii. Performance Component: 30% of the grant to be disbursed 2 years after the system becomes operational, subject to the project meeting submitted plans, including stipulated electricity output
CONSTRUCTION COSTS FOR SINGAPORE OVERALL COST TYPES
LOW S$/m2
HIGH S$/m2
Terraced Houses
2,400
2,650
Semi-Detached Houses
2,550
3,000
Detached Houses
3,000
4,000
Average Standard Condominium
1,850
2,100
Mid Range Condominum
2,100
2,800
Luxury Condominium
2,800
4,200
Average Standard Offices
2,400
2,600
Prestige Offices
2,600
2,900
Shopping Centres, Average Quality
2,600
2,800
Shopping Centres, High Quality
2,800
3,100
Theatres / Cinemas
1,950
2,200
900
1,300
1,300
1,750
Flatted Light Industrial Buildings
1,250
1,400
Flatted Heavy Industrial Buildings
1,400
1,850
Single Storey Industrial Buildings
1,150
1,300
Flatted Warehouses
1,150
1,300
Single Storey Warehouses
1,000
1,300
Resort Hotels
2,850
3,100
3-Star Hotels
2,950
3,200
4-Star Hotels
3,100
3,700
5-Star Hotels
3,750
4,300
Serviced Apartments
2,200
2,850
Private Hospitals
3,750
3,950
Polyclinics
1,550
1,750
Nursing Homes
1,550
1,850
Medical Centres
2,900
3,100
RESIDENTIAL
OFFICE
COMMERCIAL
CAR PARKS Multi-Storey Car Parks Basement Car Parks INDUSTRIAL
HOTEL (Including F.F. & E.)
HEALTH
The above costs are at 4th Quarter 2011 levels. .
With effect from 1 March 2010, the eligibility for the SCS has been revised as follows: a) SCS will offset up to 30% of the total capital cost instead of 30% - 40% of the capital cost b) New buildings have to attained minimum Green Mark GoldPLUS standard instead of Green Mark Gold standard c) Minimum system size of 50kWp is required instead of 10kWp
CURRENT CONSTRUCTION REGULATIONS Revised Strata Landed Housing Guidelines –Allowable Number of Units per Development With effect from 3 February 2009, the maximum number of allowable units in strata landed housing developments will be capped based on a minimum plot size per unit for the respective conventional landed housing form. Under the new guidelines, the maximum number ofunits allowed for strata landed housing developmentscomprising only 1 type of housing form will be determined by the following formula: Number of Allowable Units 1
≤
Total Site Area of Development Y
Where Y = plot size control for the relevant landed housing form 2 The maximum number of units allowed for mixed strata landed housing developments comprising more than 1 type of landed housing form will be determined by the following formula: (B x YB) + (SD x YS) + (T x YT) ≤ Total Site Area of Development Where, B = proposed number of strata bungalow units SD = proposed number of strata semi-detached house units T = proposed number of strata terraced house units YB,YS,YT = plot size control for the relevant landed housing form2 Note: Development applications (excluding Outline applications) submitted prior to 3 February 2009 which results in a Provisional Permission will continue to be evaluated under the old guidelines 1 Where the formula does not result in a round number, the number of allowable units will be rounded down to cater for each unit having the minimum plot size for the proposed housing form 2 Y = 400 sqm for Bungalow; Y = 200 sqm for Semi-detached house; Y = 150 B S T sqm for Terraced house
CURRENT CONSTRUCTION REGULATIONS Changes to Gross Floor Area (GFA) Exemption Guidelines – GFA to include i. Bay windows in all developments; and ii. Planter boxes within a residential unit. With effect from 1 January 2009, bay windows in all developments and planter boxes within a residential unit are no longer exempted from GFA calculations. This new guidelines do not apply to approved developments and formal development applications (excluding Outline Applications) with a valid Provisional Permission (PP) issued prior to the effective date. For approveddevelopments with approved bay windows and planter boxes exempted from GFA, these approved spaces will remain as GFA exempted until the buildings areredeveloped. The changes are summarised as follows:
OLD GUIDELINES GFA exemption apply to:
NEW GUIDELINES (WITH EFFECT FROM 1 JANUARY 2009) GFA exemption rescinded for:
• Bay windows
• Bay windows in all developments
• Planter boxes
• Planter boxes within a residential unit
GFA exemption continue to apply to:
• Planter boxes provided within non-residential developments
• Planter boxes provided within the communal areas of residential developments
Source: Urban Redevelopment Authority
CURRENT CONSTRUCTION REGULATIONS Building and Construction Industry Security of Payment Act 2004 The Building and Construction Industry Security of Payment Act (BCISOP Act) 2004 came into force in Singapore on 1 April 2005. The BCISOP Act was enacted to facilitate payments for construction work done or for related goods and servicessupplied, under a contract in the building and construction industry. The Act covers quite a wide spectrum of services within the construction industry relating to construction work which includes professionalconsultancy services. The underlining objectives of the BCISOP Act are to: • improve cash flow by expediting payment • provide a statutory entitlement to progress payments to contractors, sub-contractors and suppliers for work carried out, even if no such entitlement is provided in their contract • provide a procedure of adjudication to claim payment; which is intended to be a more cost and time efficient way of resolving disputes on payment claims between the parties • provide remedies when adjudicated amount not paid The BCISOP Act provides a new regime of claim,adjudication and enforcement procedures which include the right to suspend work for non-payment. It also renders unenforceable “pay when paid” provisions in contracts. This benefits the sub-contractors and suppliers. The BCISOP Act is supplemented by the BCISOP Regulations 2005 where the Act confers power onthe Minister of National Development to set out theregulations to facilitate the implementation of the Act. However, the BCISOP Act is not applicable toconstruction work and goods and services relating to residential property (defined under Residential Property Act) not requiring approval under the BCA Building Control Act, construction work carried outside Singapore, goods and services supplied to construction work outside Singapore and employment contracts. Notwithstanding the benefits arising from the enactment of the BCISOP Act to facilitate payment in theconstruction supply chain, it is essential for every player in the industry to have a good understanding of the Act from the operational and practical standpoint. DLS has streamlined our in-house practices as well as assisted our Clients/Developer organizations to review and make recommendations in their internal operating procedures. Payment protocol with prescribed timeframe for payment claim, QS valuation, consultant’scertification, payment response and payment termwere customized and established with the respective organization.
CURRENT CONSTRUCTION REGULATIONS Workplace Safety and Health Act (WSHA) The Workplace Safety and Health Act (WSHA)considers the safety, health and welfare of the personsat workplaces. It imposes specific duties on variouspersons (including Employer). It also provides a rangeof enforcement methods so as to enable appropriate response to a failure to comply with the Act, depending on the nature of the failure. This Act will replace the current Factories Act, which stipulates that the legal liability for safety and health in a factory lies primarily with the factory occupier. The following incidents in year 2004 have shown a need for a better work safety standard: • The Nicoll Highway collapse • The construction site accident at Fusionpolis • The fire in the vessel “Almudaina” at a shipyard In order to put in place a new and more effectiveframework to reduce accidents at the workplace, the Workplace Safety and Health Act was passed inParliament on 17 January 2006 and came into effecton 1 March 2006. This Act will form the legal framework for the new Occupational Safety Health regulatory system. It also contains a revised penalty framework to reflect the cost of poor safety management. While the maximum fine for the individuals remains at up to $200,000, the jail term has been increased from 12 months to 24 months whereas for corporations, they can be fined up to $500,000. This new regulation will require employers to conduct comprehensive risk assessment for all work processes, and provide detailed plans to eliminate or minimise risks. In view of this, the Ministry of Manpower shall work with the construction industries from the design stage to identify potential risks, rather than wait till the plans are submitted. In addition, the Ministry of Manpower officers will also have a new enforcement tool – the power to issue “Remedial Orders” whereby the officers will beempowered to compel worksites to remove a workplace risk regardless of whether there is an imminent danger. Any non-compliance can lead to stop-work order. A greater responsibility and accountability will also be assigned to everyone, from rank-and-file workers to managers and directors of companies, even though they may not be directly involved at the workplace or may not be able to physically police safety and health on the ground. The impact of these regulation changes especially with the stringent regulations and additional requirement on Health and Safety by the authorities has bearing on the overall construction costs, particularly on preliminaries and temporary works associated with construction. With effect from 1 September 2011, all workplaces will be covered under the WSHA. This latest extension bringson board more than 100,000 organizations with over1.6 million employees, or about half of the Singapore workforce. Companies and employees now covered under the Act will need to take reasonably practicable mea-
sures to ensure their workplaces are safe. This includes proper risk management or taking steps to identify and manage the existing risks in one’s workplace so as to prevent work incidents. Apart from the coverage extension of the WSHA, other key changes were also affected. These include: • Making the duties and obligations of the principals and the persons at work more defined • Enhancing the definition of Occupational Diseases to include any diseases that are attributable to chemical and biological agent exposure at work • The WSH (Noise) Regulations taking effect on 1 September 2011 and will include all workplaces to be covered under the regulation Workplace Safety and Health (WSH) (Construction) Regulations 2007 With effect from 1 January 2008, the WSH (Construction) Regulations 2007 replaces the Factories (BuildingOperations and Works of Engineering Construction) Regulations (BOWEC). The main changes of the Regulations are as follows: • Worksites with Contract Sum of less than $10 million are required to appoint a WSH Coordinator who shall assist the occupier to identify unsafe condition or unsafe work practice; recommend to the occupier such reasonably practicable measures; remedy the unsafe condition or unsafe work practice; and assist the occupier to implement such reasonable practicable measures • Inclusion of the recommendations of the MOM-MND Joint Review committee as follows: - Imposing statutory duties on Professional Engineers (PEs) undertaking design of temporary works - Requiring safety and health training for all supervisors - Instituting regular site coordination meetings - Implementing a permit-to-work system for selected hazardous work • Updating of the provisions to make it less prescriptive • Updating of all relevant terminologies • Clarifying the intended duty holder for the provision • Introducing offences and penalties provisions for the breach of the Regulations
CURRENT CONSTRUCTION REGULATIONS Code on Accessibility in the Built Environment 2007 The Code on Accessibility in the Built Environment 2007 implemented with effect from 1 April 2008 replacesthe previous Code on Barrier-Free Accessibility in Buildings 2002. The provisions of this Code will apply to new buildings and existing buildings undergoing majorretrofitting works, where the Building Plans are submitted for regulatory approval on or after 1 April 2008. The Code was first introduced in 1990 and aids tomake our buildings more user-friendly for the physically challenged. The Code was last reviewed and expanded in 2002 to include more mandatory barrier-free features in the common areas of new buildings. The current revised Code, which is in its 4th edition, contains additional requirements relating to theinterconnection between buildings and from buildingsto infrastructure and more mandatory requirementson elder-friendly features to prepare for an ageingpopulation. While the provisions in the Code are primarily meant to improve mobility for wheelchair users, they will also benefit others such as the elderly, parents with young children and people with different disabilities. Besides residential buildings, the revised Code has also expanded to incorporate accessibility enhancement to public parks, open spaces, vehicle parks, bus shelters and transport stations.
CURRENT CONSTRUCTION REGULATIONS Mandatory Water Efficiency Labelling Scheme (MWELS) With effect from 1 July 2009, the Public Utilities Board (PUB) implemented the Mandatory Water Efficiency Labelling Scheme (MWELS) to further promote water conservation, accelerate the adoption of water efficient fittings and products and encourage suppliers to bring in more water efficient models. The water fittings, appliances, apparatuses and products covered under MWELS include the following: a. Shower Taps and Mixers (except concealed shower taps and mixers and concealed bath/shower taps and mixers – which are not covered under MWELS for the time being) b. Basin Taps and Mixers c. Sink/Bib Taps and Mixers d. Dual Flush Low Capacity Flushing Cisterns (Dual Flush LCFCs) e. Urinal Flush Valves f. Waterless Urinals PUB will oversee the registration of water fittings,appliances, apparatuses and products under MWELSto which the labelling and standards provisions apply, and will monitor to enforce compliance with the scheme. All water fittings, appliances, apparatuses and products to be labelled under the mandatory and voluntary WELS shall comply with the standards and requirements stipulated by PUB. The Scheme requires the water fittings, appliances,apparatuses and products covered under MWELS to be labelled for the purpose of supply, sale or offer, display or advertisement for supply or sale or installation or use in Singapore. All water fittings, appliances, apparatuses and products that are required to be labelled under MWELS will be rated. “Zero Tick” label shall apply to water fittings, appliances, apparatuses and products that do not meet 1 or more ticks requirements or have not undergone test for water efficiency. In essence, the more number of ticks, the more water efficiency the product is. (See Figure 1 and Figure 2 below)
Figure 1 : Mandatory WELS Label
Figure 2 : Voluntary WELS Label
Source: Public Utilities Board (PUB) as at 1 July 2011
With effect from 1 October 2011, MWELS will be extended to clothes washing machines intended for household use and showerheads will be covered under voluntary WELS.
CURRENT CONSTRUCTION REGULATIONS Market Development Fund for the Usage of Clear and Renewable Energy in Singapore The Energy Market Authority (EMA) has set up the Market Development Fund (MDF) to encourage the installation of clean and renewable energy technologies/ systems in commercial or industrial building/facility (i.e. non-residential). To qualify for the funding support, the project must: • Demonstrate the use of clean and renewable energy technologies/systems for power generation • Participate in the wholesale electricity market • Utilize clean and renewable energy technologies/ systems that are supported by MDF, including: i. Solar (Photovoltaic (PV), Concentrated Solar PV and Concentrated Solar Power) ii. Wind turbines iii. Hydrogen production and fuel cells iv. Energy storage systems such as batteries v. Microturbines (biogas) vi. Integration of building or office energy management that will improve energy efficiency
systems
The MDF will co-fund 90% of the incurred market charges, subject to a cap of $50,000 per project. The funding support will last for two years but can be extended to a maximum of five years (subject to approval). The following market charges are applicable for reimbursement: a. b. c. d. e.
EMC Fees PSO Fees Reserve Regulation Charges (AFP) Spinning Reserves Charges (if applicable) Fixed Charges including: i. Billing and Collection Charge ii. Meter Reading and Data Management Fee iii. Telephone Subscription For Meter Reading iv. Wholesale Trading License
Note:EMC denotes Energy Market Company Pte Ltd. EMC operates Singapore’s wholesale electricity market. All of Singapore’s electricity is bought and sold through EMC. PSO denotes Power System Operator, a Division of the EMA and is responsible for the secure supply of electricity to consumers and operation of the transmission system. The Division operates from the Power System Control Centre (PSCC) which is the nerve centre of the electricity generation and transmission system in Singapore.
CURRENT CONSTRUCTION REGULATIONS Energy, Environment and Financial Impacts of Fuel Switch Solutions for Domestic Water Heating Systems in Singapore The National University of Singapore and ZEBTechnology Pte Ltd Singapore have carried out an independent study for City Gas Pte Ltd, Singapore to determine the financial and environmental impact of fuel switch solutions for domestic water heating systems in Singapore. The main objectives of the study are to compare the energy consumption and the carbon reduction between gas and electric type of domestic water heating systems in Singapore. The key findings of the study are summarized as follows: 1. At the individual user level, the annual energy cost saving (in %) may be as high as 91% for the conservative user, if one was to convert from electric storage heater to the gas continuous flow heater, and leaves the storage heater turn on for a period of approximately 52 minutes before use. On the other hand, if one was to switch from electric instantaneous heaters to gas continuous flow heaters, the savings could range between 14% and 44% of the total hot water energy use. 2. At a national level, the fuel switch from electric storage heater to gas continuous flow heater may reduce the carbon emission by up to 86%. This is equivalent to 0.5 million tons of carbon emission annually. There is a potential savings of up to 64% in energy use with respect to total energy use for hot water generation in Singapore when all households switch to using gas continuous flow heaters This translates to a saving of 700,000 MWh or S$149 million per year. This is equivalent to planting about 500,000 trees per annum to provide the carbon sink for the absorption of the same carbon; or equivalent to the removal of 72,780 cars from the road. 3. For new developments, the increase in installation cost for a gas continuous flow heater may be recovered from energy saving within 9 months for a small apartment to a maximum of 2.1 years for a large condominium. The payback period for a retrofit scenario from electric storage heater to gas continuous flow water heater ranges from 1.5 years to 3.2 years. 4. For Housing Development Board (HDB) developments, the estimated capital costs are in the range from S$750 to S$1,100 for 3-room to 5-room apartments respectively when residents opt for the gas continuous flow heaters. Generally, the payback period is in the range of 0.75 to about 2 years.
COST BREAKDOWN FOR DIFFERENT BUILDING TYPES BUILDING TYPES
STRUCTURAL
ARCHITECTURAL
M&E SERVICES
EXTERNAL WORKS
Bungalows
15%
47%
23%
15%
Condominiums
21%
50%
22%
7%
Offices
22%
44%
32%
2%
Hotels
19%
42%
35%
4%
Retails
23%
40%
32%
5%
Factories / Warehouses
30%
37%
28%
5%
Schools
25%
43%
22%
10%
Note: a) Structural includes Piling, Foundation and Structure. b) Architectural includes External walls, Internal Walls, Roof, Wall Finishes, Ceiling Finishes, Floor Finishes, Sanitary Fittings, Windows & Doors and Joinery Fittings. c) M&E includes Electrical Services, Fire Protection, Plumbing, Vertical Transport and ACMV
50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%
Bungalows
Condominiums
Structural
Offices
Architectural
Hotels
Retails
M&E
Factories/ Warehouses
External Works
Schools
CURRENT CONSTRUCTION REGULATIONS Sustainable Construction Capability Development Fund The $15 million Sustainable Construction Capability Development Fund (SC Fund) was established by the BCA to build up the capabilities of industry players in adopting Sustainable Construction (SC) practices,technologies and materials, and eventually steering the industry towards self-sustenance in the demand and supply of SC materials in Singapore. The SC Fund focuses on developing capabilities in recycling of waste materials arising from the demolition of buildings and using of recycled materials for construction. The incentive scheme operates on a co-funding basis (i.e. up to 50% of the total qualifying cost). The scheme came into effective on 15 April 2010 and will last for 5 years or till the $15 million is exhausted, whichever comes earlier. Firms that are registered and physically present inSingapore, will be able to apply for the SC Fundby submitting their detailed capability-developmentproposals to BCA, highlighting their capability-upgrading plans through manpower development, acquiring of equipment and engaging of external consultants, etc. The fund can be used for: • Enterprise-Level Projects – projects that improve capabilities
business’
• Industry-Level Projects – projects by a group of companies aimed at improving collective capabilities Appended below are the types of project / firm eligible for the SC Fund: • Demolition Contractors (Note: For projects involving demolition protocol, funding is capped at 2 projects of different building types per contractor and min. project size of GFA = 5,000m2) • Construction and Demolition (C&D) Industrial Waste Recyclers • Ready Mixed Concrete (RMC) Manufacturers • Pilot studies to gain technology know-how and confidence in adoption of new SC practices Note: Further information can be found in BCA’s website. (http://www.bca.gov.sg/Professionals/GovAsst/govasst.html)
CURRENT CONSTRUCTION REGULATIONS Construction Productivity and Capability Fund With the emphasis on the need to boost Singapore’s productivity level, the Government on 1 June 2010 launched a $250 million Construction Productivity and Capability Fund (CPCF). The objective is to steer the construction industry towards higher productivity and build capability. CPCF will also complement other regulatory changes such as the foreign workers’ levy framework, the gradual reduction of the Man-Year Entitlements (MYEs) quota and the enhancement of BCA’s buildability framework. The CPCF focuses on the following three broad aspects:
Source: Building and Construction Authority More information on the CPCF can be found in BCA’s website. (http://www.bca.gov.sg/CPCF/cpcf.html)
CURRENT CONSTRUCTION REGULATIONS Increase in Foreign Workers’ Levy As part of the Government’s strategy to achieve productivity-led growth, the Government announced on 8 March 2010 that the monthly levy for foreign workers would be raised in phases over 3 years starting from July 2010 to July 2012. The Government have made an announcement on 21 February 2011 that the foreign worker levy (FWL) rates will be further raised to enhance productivity and compe-tency of the construction workforce and reducing reliance on low-skilled foreign workers. The changes to the FWL rates and tiers will be phased-in from January 2012 to July 2013, at 6-monthly intervals. The salient changes are as follows: (a) Introduction of New Skills Framework in July 2011 • Unskilled Work Permit holders will be phased out • Introduce ‘Higher Skilled’ tier (R1) for Work Permit holders who possess the relevant certifications and experience • The criteria for R1 would include: - CoreTrade Registered; or - Have at least 4 years’ experience with additional/ specialised skills certifications • Re-classify existing Work Permit holders with only Skills Evaluation Certification (Knowledge) as ‘Basic Skilled’ (R2) • Retain MYE-waiver route but subject to higher levies (b) Monthly Levy Rates
•
•
•
•
With effect from 1 July 2011: - Higher Skilled Work Permit holders (R1)
=
$180
- Basic Skilled Work Permit holders (R2)
=
$230
- MYE Waiver *
=
$380
- Higher Skilled Work Permit holders (R1)
=
$200
- Basic Skilled Work Permit holders (R2)
=
$300
- MYE Waiver *
=
$450
- Higher Skilled Work Permit holders (R1)
=
$250
- Basic Skilled Work Permit holders (R2)
=
$350
- MYE Waiver *
=
$500
- Higher Skilled Work Permit holders (R1)
=
$280
- Basic Skilled Work Permit holders (R2)
=
$400
- MYE Waiver *
=
$550
With effect from 1 January 2012:
With effect from 1 July 2012:
With effect from 1 January 2013:
• With effect from 1 July 2013: - Higher Skilled Work Permit holders (R1)
=
$300
- Basic Skilled Work Permit holders (R2)
=
$450
- MYE Waiver *
=
$600
Note * The monthly levy rate applies to foreign workers from Non-Traditional Sources or People's Republic of China in the construction and process industries, who have been exempted from the requirement of Man-Year Entitlements (MYEs). To be exempted from MYE, the foreign worker must have at least two years' working experience in his respective industry and his employer has applied for a Work Permit without any Prior Approval support. Non-Traditional Sources - India, Sri Lanka,Thailand, Bangladesh, Myanmar, Philippines, Pakistan For more information, please refer to the Ministry of Manpower’s website.
(c) MYE Reduction - 1 July 2010 = 5% - 1 July 2011 = 10% - 1 July 2012 = 10% - 1 July 2013 = 15%
CURRENT CONSTRUCTION REGULATIONS New Measures to Reduce Noise The National Environment Agency (NEA) announced on 9 March 2010 that with effect from 1 September 2010, no construction activities would be allowed from 10pm on the night before a Sunday or a Public Holiday to 10am on the day itself. This new prohibition by the NEA will apply to construction sites located within 150 metres of residential areas and noise-sensitive developments. The new measures will be implemented in 2 phases. • Phase 1 will be implemented with effect from 1 September 2010 whereby all new projects will have to stop work from 10pm on Saturday to 10am on Sunday. This ban applies to any building project within 150m of a residential areas and noise-sensitive developments. It also applies to the eve of Public Holidays and Public Holidays. • Phase 2 will take effect from 1 September 2011 onwards, no construction activities would be allowed from 10pm on Saturday or eve of Public Holidays to 7am on the following Monday or day after the Public Holidays. This change in policy will inevitably create a need for construction companies to reschedule their construction work programme. As a result, it is anticipated that this could result in an increase in the contractor’s pricing of the preliminaries cost.
CURRENT CONSTRUCTION REGULATIONS Security of Water Storage Tanks With effect from 1 July 2011, all Town Councils (TCs), Management Corporation Strata Titles (MCSTs) and Building Owners are required to strengthen the security of water tanks on their premises. Accordingly, the following measures extracted from the Public Utilities (Water Supply) Regulations must be strictly complied with: a)Ensure that authorized persons are restricted to the TCs’/MCSTs’/Building Owners’ staff or the managing agent b) Ensure that personnel authorized to work at rooftops, pump/tank rooms & enclosures and tanks are properly attired (e.g. identification vests, badges, etc.) for easy identification as authorized personnel to work in these designated areas c)Conduct spot checks on works carried out at rooftops, pump/tank rooms & enclosures and tanks, and keep proper records of these checks d) Ensure that the room/enclosure housing the water tanks, access to high level tanks on the rooftop and the water tank inspection manhole covers are properly locked with the use of high quality padlocks or locksets (e.g. “Abloy”, “Kaba”, “Medeco”, “Mul-T”) to deny unauthorized access at all times. The hinges and latches should be of equally high quality and well secured e) Ensure that keys to the access doors and the water tank inspection covers are restricted to only the authorized persons f) Ensure that the keys to the locks to access doors and the tank inspection covers shall be of a type that cannot be duplicated. To provide separate keys for tank covers, pump room and roof access. One master key each for: • Access doors of not more than 100 blocks • Tanks of no more than 20 blocks • Corresponding locks shall be replaced if key is lost g)The keys for the locks for the tank inspection covers must be housed in a dedicated keypress separate from the other keys and access to these keypress must be strictly controlled by an authorized person h) Upon completion of work at the water storage tanks or at the end of the day, whichever is earlier, the authorized person must return the key to the office i) In the case of suspected water contamination, to immediately: • Notify PUB’s 24 hour call centre at 1800-284-6600 • Isolate the water supply and collect water samples • Notify verbally, followed by written notice, all the residents/occupants of the building not to consume or use the water due to possible water contamination
• Shut off the stopcock at the individual meter position of each unit in the building TCs/MCSTs/Building Owners are advised to segregate the water storage tank area from other activities and services. PUB will also work with the TCs/MCSTs/ Building Owners on further technological solutions such as the use of alarm system and remote monitoring, etc. Members of the public are encouraged to report any suspected unauthorized access to the premises where water tanks are located to the respective TCs/MCSTs/ Building Owners immediately. Note: On 30 June 2011, PUB announced the extension of the implementation date for the bolting of water tank covers and the replacement of locksets to 31 December 2011. Most of the operational measures to tighten water security, however, have/are being implemented.Source: Public Utilities Board (PUB)
CURRENT CONSTRUCTION REGULATIONS Implementation of Eurocodes in Singapore The Building and Construction Authority (BCA) announced to the construction industry in October 2006 their decision to align with the practice in United Kingdom (UK) in adopting Eurocodes as the structural design standards and together with SPRING formed various technical committees to review the corresponding UK National Annexes of the Eurocodes for adoption as our local standards. In a recent BCA’s circular (dated 26 September 2011), it has been informed that almost all of these documents for the design of concrete and steel structures have been published as Singapore Standards (SS ENs). With effect from 1 April 2012, BCA plans to accept the Singapore version of the Eurocodes (i.e. SS ENs and the Singapore National Annexes). The date of implementa-tion will be informed once Approved Documents is amended to include the SS ENs as the acceptable standards for the structural design. To facilitate the transition to the new SS ENs, there will be a co-existence period of 2 years from the commencement date of adoption of SS ENs, during which either the BS or Eurocode design standard will be acceptable. To familiarise the industry with the new SS Eurocode standards, the BCA Academy, SPRING, participating professional associations and our local universities have been organising training courses and seminars since 2006. Details of the various courses and workshops organised by BCA Academy can be obtained at the following websites: • www.bcaa.edu.sg (and doing a search under “Eurocodes”) •http://www.bca.gov.sg/academy/courses_tests. aspx?txtCourseTestCode=eurocode Source: Building and Construction Authority
M&E COSTS FOR SINGAPORE TYPES
ACMV
ELECTRICAL HYDRAULIC
FIRE
LIFTS
BAS
S$/m2
S$/m2
S$/m2
S$/m2
S$/m2
S$/m2
Detached Houses
89 - 104
87 - 115
64 - 89
0- 4
-
-
Average Standard Condominium
95 - 124
109 - 155
75 - 114
19 - 37
27 - 54
-
115 - 192
154 - 252
92 - 159
19 - 53
36 - 123
-
Average Standard Offices
153 - 194
203 - 259
31 - 49
32 - 53
62 - 115
7 - 21
Prestige Offices
169 - 228
227 - 306
39 - 71
44 - 64
90 - 177
15 - 30
Flatted Factories
69 - 136
76 - 148
20 - 39
39 - 54
46 - 96
4 - 16
Warehouses
29 - 77
58 - 97
19 - 29
24 - 54
46 - 114
4 - 11
Resort Hotels
150 - 209
202 - 274
97 - 124
49 - 59
76 - 119
5 - 26
3-Star Hotels
164 - 216
218 - 293
97 - 123
49 - 68
76 - 120
5 - 26
5-Star Hotels
200 - 289
279 - 340
118 - 136
53 - 78
100 - 138
30 - 47
Multi-Storey Car Parks
18 - 36
15 - 39
4 - 13
17 - 37
0 - 23
-
Basement Car Parks
28 - 50
23 - 42
8 - 19
26 - 42
0 - 23
-
158 - 214
170 - 275
49 - 75
38 - 63
83 - 200
4 - 37
RESIDENTIAL
Luxury Condominium OFFICE
INDUSTRIAL
HOTELS
OTHERS
Shopping Centres
The above costs are at 4th Quarter 2011 levels.
OFFICE M&E COST COMPONENTS ACMV 9%
18%
Plumbing and Sanitary 3% 3%
11%
7% 9%
19%
2%
1%
12%
3% 5%
8%
9%
20%
27%
28%
Chillers plant Cooling towers Chilled water pumps Chilled water pipeworks Condenser water pumps and pipeworks Condenser water pipeworks
6% Water tank Water pumps Cold water distribution piping Installation and connection of water piping to sanitary wares Aboveground drainage piping system Underground drainage piping system Installation and connection of waste piping to sanitary wares
Chilled water AHU/FCU system AC ductworks, diffusers and accessories Split type air-conditioning units and ductworks Mechanical ventilation fan system MV ductworks, diffusers and accessories Electrical and automatic control works
Electrical
2% 2% 2%
8%
2%
4%
Fire Protection
45%
2%
10% 5%
5%
20%
10%
3%
4%
23%
3%
1% 23%
LV mains & sub-mains distribution system Lightning protection system Luminaries Earthing system Final sub-circuit for lighting & power points External lighting Standby generator Telephone distribution system Sub-station, HV & LV switchgear MATV/SCV system Underfloor trunking system CCTV/Guard patrol system Power transformer Public address system Intercom/Card access system
4% 12%
10% Sprinkler Hose reel Wet riser Dry riser Automatic fire alarm Fire extinguisher External fire hydrant
M&E COST CHARTS Single Core PVC Cables
Pipework
175
300
150
250 200
100
$/m
$/m
125
75
150 100
50
50
25
0
0 1
2.5
6
16
35
70
120 185
300
500
15
800
20
25
32
40
mm2 1 x 1 Core
1 x 3 Core
1 x 4 Core
Galvanised Steel
4,000
400
3,000
300
$/m2
$/no
500
2,000
200
1,000
100
50
80
125 200 300 400 600 800 1,250
26
24
Four Pole
Galvanised Steel
200
UPVC
20
18
16
Stainless Steel
2 hr Fire Rated
Valve
4,000
4,000
3,000
3,000
$/no
$/no
150
Gauge (SWG)
Wall Mounted Direct Expansion Fan Coil Unit
2,000
2,000 1,000
1,000
0
0 2.6
3.5
4.4
5.3
15
6.4
25
40
Single Split Unit
65
100
200
300
Diameter (mm)
Cooling Capacity (kW) Gate Valve
VRV
Check Valve
Globe Valve
Motor and Starter
Condensing Unit 8,000
8,000
6,000
6,000
$/no
$/no
Black Steel
22
Amp Triple Pole
100
0
0 32
80
Ductwork
5,000
16
65
Diameter (mm)
22kA MCCB
6
50
4,000 2,000
4,000 2,000
0
0 17.1
23.5
28.2
Cooling Capacity (kW) Single Split Unit
VRV
0.38
0.75
2.25
3.75
7.5
15
22.5
Capacity (kW) Motor
Starter
37.5
75
COMMON STANDARD FORMS OF CONTRACT IN SINGAPORE - CURRENT AS OF 2012 • Articles and Conditions of Building Contract published by the Singapore Institute of Architects, 9th Edition, Reprint August 2011 [Measurement Contract] • Articles and Conditions of Building Contract published by the Singapore Institute of Architects, 9th Edition, Reprint August 2011 [Lump Sum Contract] • Articles and Conditions of Building Contract for Minor Works published by the Singapore Institute of Architects, 1st Edition 1987 • Conditions of Sub-Contract for use in conjunction with the Singapore Institute of Architects Main Building Contract, 4th Edition, Reprint August 2011 • REDAS Design and Build Conditions of Contract published by the Real Estate Developers' Association of Singapore, 3rd Edition October 2010 • FIDIC Forms of Conditions of Contract published by the Federation Internationale des Ingenieurs-Conseils, 1st Edition 1999 - Conditions of Contract for Construction for Building and Engineering Works designed by the Employer - Conditions of Contract for Plant and Design-Build for Electrical and Mechanical Plant and for Building and Engineering Works designed by the Contractor - Conditions of Contract for EPC/Turnkey Projects - Short Form of Contract • Public Sector Standard Conditions of Contract for Construction Works published by the Building and Construction Authority, 6th Edition December 2008 • Public Sector Standard Conditions of Contract for Design and Build published by the Building and Construction Authority, 5th Edition December 2008 • Standard Conditions of Nominated Sub-Contract for use in conjunction with the Public Sector Standard Conditions of Contract for Construction Works published by the Building and Construction Authority, 5th Edition December 2008
EXCHANGE RATES Approximate current rates at 28 September 2011 COUNTRY Australia
PER UNIT dollar
S$ 1.271
China
rmb
0.2002
Euro
eur
1.7488
100 HKd
0.1655
Hong Kong India
100 rupees
2.63
Indonesia
100 Rp
0.0146
Japan
100 yen
1.688
Korea
won
0.0011
ringgit
0.4075
Malaysia Philippines
100 peso
2.98
Taiwan
NT dollar
0.0424
Thailand
100 baht
4.18
United Kingdom
pound
2.015
USA
dollar
1.29
Vietnam
dong
0.000062
Source: The Hongkong and Shanghai Banking Corporation Limited
CURRENCY FLUCTUATIONS Sterling Pound
US Dollar
S$ per 1 STGP
S$ per 1 US$
3.4
1.9
3.2
1.8
3.0
1.7
2.8
1.6
2.6
1.5
2.4
1.4
2.2
1.3
2.0 1.8
02
03
04
05
06
07
08
09
10
11*
12
1.2
02
03
04
05
06
07
08
Ringgit Malaysia
Japanese Yen
S$ per 1 RM
S$ per 100 Yen
09
10
11*
12
09
10
11*
12
1.7
0.50
1.6
0.48
1.5 0.45 1.4 0.43
0.40
1.3
02
03
04
05
06
07
08
09
10
11*
12
Note: *Currency fluctuation for 2011 is based on January 2011 to November 2011
1.2
02
03
04
05
06
07
08
Note: *Currency fluctuation for 2011 is based on January 2011 to November 2011
RELEVANT WEBSITES Singapore Government Accounting and Corporate Regulatory Authority Board of Architects Singapore Building and Construction Authority Central Provident Fund Board Housing & Development Board Inland Revenue Authority of Singapore Integrated Land Information Service Intellectual Property Office of Singapore International Enterprise Singapore Land Surveyors Board Singapore Land Transport Authority Ministry of Community Development, Youth and Sports Ministry of Defence Ministry of Education Ministry of Finance Ministry of Foreign Affairs Ministry of Health Ministry of Home Affairs Ministry of Information, Communications and The Arts Ministry of Law Ministry of Manpower Ministry of National Development Ministry of the Environment and Water Resources Ministry of Trade and Industry Ministry of Transport Monetary Authority of Singapore National Parks Board Professional Engineers Board Singapore Public Utilities Board Singapore Civil Defence Force Singapore Department of Statistics Singapore Economic Development Board Singapore Government Website Singapore Land Authority Singapore Power Ltd Group Strata Titles Boards Urban Redevelopment Authority
www.acra.gov.sg www.boa.gov.sg www.bca.gov.sg www.cpf.gov.sg www.hdb.gov.sg www.iras.gov.sg www.inlis.gov.sg www.ipos.gov.sg www.iesingapore.gov.sg www.minlaw.gov.sg/lsb www.lta.gov.sg www.mcys.gov.sg www.mindef.gov.sg www.moe.gov.sg www.mof.gov.sg www.mfa.gov.sg www.moh.gov.sg www.mha.gov.sg www.mica.gov.sg www.minlaw.gov.sg www.mom.gov.sg www.mnd.gov.sg www.mewr.gov.sg www.mti.gov.sg www.mot.gov.sg www.mas.gov.sg www.nparks.gov.sg www.peb.gov.sg www.pub.gov.sg www.scdf.gov.sg www.singstat.gov.sg www.edb.gov.sg www.gov.sg www.sla.gov.sg www.singaporepower.com.sg www.mnd.gov.sg/stb/ www.ura.gov.sg
Construction-Related Associations in Singapore Real Estate Developers’ Association of Singapore Singapore Green Building Council Singapore Institute of Planners Singapore Institute of Architects Association of Consulting Engineers Singapore The Institution of Engineers Singapore Society of Project Managers Singapore Institute of Surveyors and Valuers Association of Property and Facility Managers Singapore Institute of Building Limited The Law Society of Singapore
www.redas.com www.sgbc.sg www.sip.org.sg www.sia.org.sg www.aces.org.sg www.ies.org.sg www.sprojm.org.sg www.sisv.org.sg www.apfm.org.sg www.sib.com.sg www.lawsociety.org.sg
Others Davis Langdon & Seah Asia
www.dlsqs.com
About Us Davis Langdon & Seah (Thailand) Ltd. was established in 1990 to operate in conjunction with our sister company LECE (Thailand) Co.,Ltd. (Langdon Every Cost Engineering) which was first established in 1984 to provide cost engineer-ing and project management support services to the Oil Industry in Thailand. In 1987, responding to popular demand, the activities were extended to cover the whole range of quantity surveying / cost management services for the Building and Construction Industry in general.
Davis Langdon & Seah (Thailand) Ltd. LECE (Thailand) Co., Ltd. Quantity Surveyors & Construction Cost Consultants
Construction Costs for Thailand DOMESTIC
Terraced houses Average standard apartments, high rise Luxury apartments, high rise Luxury Villa OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres
HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F.&E. 5-star luxury hotels, ditto
INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car park (< 3 levels) Elevated car parks (< 4 levels) Primary and Secondary Schools Student hostels Sports clubs including F.F.& E.
BANGKOK
PATTAYA
17,500 24,850 34,850 29,000
17,500 24,500 34,850 N/A
22,500 30,000 28,000 68,000 41,000 58,000
Baht/m2 CHIANGMAI
KOH SAMUI
PHUKET
N/A 26,500 34,850 N/A
N/A N/A N/A 74,000
N/A N/A N/A 64,000
22,250 29,500 28,000
21,500 N/A 24,500
N/A N/A N/A
N/A N/A 26,500
68,000 41,000 58,000
68,000 41,000 58,000
83,000 N/A 83,500
74,000 N/A 68,000
18,000 N/A 18,000
18,000 N/A 18,000
N/A N/A N/A
N/A N/A N/A
N/A N/A N/A
N/A
N/A
N/A
N/A
N/A
20,500 10,500 N/A N/A N/A
20,000 10,000 N/A N/A N/A
N/A 10,000 N/A N/A N/A
N/A N/A N/A N/A N/A
N/A 12,000 N/A N/A N/A
Major Rates for Thailand DESCRIPTION
BANGKOK
Baht CHIANGMAI KOH SAMUI
PHUKET
1. Excavating basement ≤ 2m deep 2. Excavating for footings ≤ 1.5m deep 3. Remove excavated materials off site 4. Hardcore bed blinded with fine materials 5. Mass concrete grade 15 6. Reinforced concrete grade 30 7. Mild steel rod reinforcement 8. High tensile rod reinforcement 9. Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting 13. Aluminium casement windows, single glazed
m3 m3 m3 m3 m3 m3 kg kg m2 m2 m2
100.00 100.00 100.00 600.00 2,000.00 2,400.00 31.00 30.00 350.00 350.00 700.00
250.00 250.00 150.00 700.00 2,400.00 3,000.00 35.00 34.00 450.00 450.00 800.00
200.00 200.00 150.00 800.00 3,200.00 3,400.00 38.00 37.00 480.00 480.00 800.00
250.00 250.00 150.00 800.00 2,400.00 3,000.00 35.00 34.00 420.00 420.00 800.00
m2 m2
1,200.00 6,000.00
1,200.00 6,500.00
1,200.00 7,500.00
1,200.00 6,500.00
14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
kg
55.00
60.00
60.00
55.00
kg m2 m2 m2 m2
55.00 200.00 200.00 1,200.00 800.00
60.00 250.00 250.00 1,200.00 800.00
60.00 250.00 250.00 1,200.00 900.00
55.00 250.00 250.00 1,200.00 800.00
m2 %
100.00 10 - 15
120.00 12 - 20
150.00 15 - 25
100.00 15 - 17
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies and preliminaries.
Fit-Out Costs for Bangkok DESCRIPTION HOTELS
Public Area (Front of House) 3-star Hotel 4-star Hotel 5-star Hotel
Bt/m
2
20,000 30,000 45,000 -
30,000 45,000 above
Bt/Room Guest Rooms : 3-star Hotel 400,000 - 800,000 800,000 - 1,400,000 4-star Hotel 5-star Hotel 1,400,000 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, building shell, chandelier, operational items and equipment (e.g. bed, cutlery, crockery, linen, television, refrigerator etc.), opening expenses, stage equipment and computer systems. OFFICES
Bt/m
2
General office 15,000 - 20,000 Executive office 20,000 - 25,000 25,000 - above Prestige office Notes : 1. Local furniture allowed for general offices 2.Includes furniture, partitioning, minor alteration to airconditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, Local Area Network, office equipment (e.g. computers, photocopies, fax machines, UPS, etc).
RESTAURANTS
General dining restaurant
Bt/m
20,000 45,000 -
2
45,000 above
Fine dining restaurant Notes : 1. Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc).
Construction Material Price Index (Year 2005 = 100) 2005
Timber Products Cement Concrete Ingredient Iron products Tiles Paint Sanitary Ware Electrical & Plumbing Others All Commodities
100.0 100.0 100.0 100.0 100.0 100.0 100.1 100.0 100.0 100.0
2006
2007
105.4 104.6 103.8 98.6 103.0 103.0 112.6 109.8 108.8 103.7
109.8 106.7 105.1 108.8 106.6 102.2 123.5 113.9 110.2 108.8
2008
2009
133.4 112.8 103.8 103.6 110.7 113.2 148.9 108.2 119.2 110.8
118.8 114.2 109.8 150.5 109.1 105.8 131.8 114.7 118.3 127.4
2010
135.8 104.2 102.5 110.9 110.6 113.8 144.5 110.4 122.8 113.3
2011
139.8 115.1 106.2 123.6 109.3 116.5 150.0 113.6 129.2 120.2
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
Construction Material Price Index (Year 2005 = 100) 170.0 150.0 130.0 110.0 90.0 70.0 50.0 2000
2001
2002
2003
2004
2005
2006
2007
2008
Timber Product
Cement
Concrete Ingredient
Iron Products
Tiles
Sanitary ware
Electrical & Plumbing
Others
All Commodities
Paint
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
2009
2010
2011
Percentage Change of Construction Material Price Index
Timber Products Cement Concrete Ingredient Iron products Tiles Paint Sanitary Ware Electrical & Plumbing Others All Commodities
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
2005
2006
2007
2008
2009
2010
2011
3.14% -6.45% 2.35% -3.01% 2.15% 3.09% 4.93% 2.46% 5.82% 0.00%
5.40% 4.60% 3.80% -1.40% 3.00% 2.90% 12.60% 9.80% 8.80% 3.70%
4.17% 2.01% 1.25% 10.34% 3.50% -0.78% 9.68% 3.73% 1.29% 4.92%
8.20% 7.03% 4.47% 38.33% 2.35% 3.52% 6.72% 0.70% 7.35% 17.10%
12.29% -1.23% -5.46% -31.16% 1.47% 6.99% 12.97% -5.67% 0.76% -13.03%
1.80% -7.62% -1.25% 7.05% -0.09% 0.53% -2.96% 2.03% 3.02% 2.26%
2.95% 10.46% 3.61% 11.45% -1.18% 2.37% 3.18% 2.90% 5.21% 6.09%
LAND AND BUILDING TRANSACTION NATIONWIDE Land and Building Transaction Nationwide 900,000 800,000
(Million Bath)
700,000 600,000 500,000 400,000 300,000 200,000 100,000 -
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Millions (Baht) 164,8 238,2 367,0 270,1 279,0 344,7 404,7 396,1 441,2 338,9 209,1 186,2 193,7 208,9 364,0 762,5 694,3 621,9 617,9 593,5 709,1 661,1 808,9
Source : Bank of Thailand
CONSTRUCTION AREAS PREMITTED IN MUNICIPAL ZONE Construction Areas Permitted in Municipal Zone 40,000 35,000 30,000
m2 ('000)
25,000 20,000 15,000 10,000 5,000 -
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Residen al
23,102
16,593
11,546
4,569
3,806
4,886
6,393
10,215
13,206
16,111
14,448
13,695
12,917
12,494
10,974
12,471
Commercial
10,721
8,136
8,485
1,902
2,058
1,883
1,702
2,255
3,364
3,641
2,973
3,483
2,444
2,909
3,755
2,878
Industrial & others
2,963
2,020
1,715
971
769
835
864
1,421
2,002
2,947
2,213
2,394
2,002
2,088
2,258
2,610
Source : Bank of Thailand
LAND TITLES AND MEASUREMENT Land Titles Chanote – Chanote is the only true title deed. The person’s name shown on the deed has the legal ownership to the land. The land is accurately survey and plotted with unique numbered marker posts set in the ground. Nor Sor Sam Gor – Nor Sor Sam Gor certifies the person named on the certificate has the right to possess the land and use the benefit of the land as an owner. The land is accurately survey and the issuance of the title deed is pending. Nor Sor Sam – Similar to Nor Sor Sam Gor but not all of the formalities to certify the right to use have been performed. The land is not accurately survey and may subject to boundary dispute. Other forms of land title or rights are Sor Kor Nung, Por Bor Tor 6 and Sor Por Kor 4-01. Land with these type of titles or certificates can neither be transferred nor obtained approval to build on. Land Measurement : 1 Hectare is approximately 6.25 Rai 1 Rai
= 1,600m2 = 4 Ngan
1 Ngan = 400m2 1 Wah = 4 m2
= 100 Wah
Exchange Rates as at 20 December 2011
Country
Currency
THB 1
US $1
Australia
dollar
0.03206
1.0061
Bahrain
dinar
0.01196
0.3753
Brunei
dollar
0.04092
1.2841
China
rmb
0.20284
6.3657
Egypt
pound
0.19138
6.0063
ecu
0.02447
0.7680
dollar
0.24803
7.7842
India
rupees
1.71817
53.922
Indonesia
rupiah
287.576
9025.2
Japan
yen
2.48000
77.90
Kenya
shillings
2.62224
82.296
Lebanon
pound
47.2000
1,482.22
Malaysia
ringgit
1.10129
3.1789
New Zealand
dollar
0.04192
1.3156
Pakistan
rupee
2.82474
88.651
Philippines
peso
1.39572
43.803
Qatar
riyal
0.11586
3.6361
Russia
rubles
1.01977
32.004
Singapore
dollar
0.04159
1.3054
South Africa
rand
0.26681
8.3734
South Korea
won
37.2194
1,168.0
Thailand
baht
1.00000
31.2089
United Arab Emirates
dirham
0.11701
3.6722
United Kingdom
pound
0.02054
0.6477
United States of America
dollar
0.03186
1.0000
European Currency Unit Hong Kong
Source: www.oanda.com/convert/classic
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, India, Malaysia, Philippines and Singapore and is also the editor of the Spon’s Price Book Series which comprise: • Spon’s Asia Pacific Construction Costs Handbook • Spon’s European Construction Costs Handbook • Spon’s Architects' and Builders’ Price Book • Spon’s Civil Engineering and Highway Works Price Book • Spon’s Mechanical and Electrical Services Price Book • Spon’s Landscape and External Works Price Book (co-edited by Derek Lovejoy Partnership) This version of DLS Handbook - Vietnam 2012, as other future annually published handbooks, focuses on the construction cost profile of Vietnam and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in Asia. The information contained in this handbook has been compiled by Davis Langdon & Seah Vietnam Co Ltd. Any further information and/or if advice relating to particular projects in specific region is required, please contact any of the regional offices listed under the Directory of Davis Langdon & Seah International Offices at the end of this handbook. Davis Langdon & Seah Vietnam Co Ltd
CONSTRUCTION MARKET 2012 OUTLOOK 2011 has been a year of economic cooling down and this is reflected in the fact that GDP growth in 2011 was circa 6.3% compared with 6.8% in 2010. It is most likely that construction output will grow at a slower rate in 2011 than in 2010. Over the past 12 months there have been a range of fiscal constraints imposed upon the Vietnam Economy in order to reduce economic overheating. The resultant effects of such overheating over the past couple of years have been significant balance of payment deficits and very high inflation. In order to cool down the economy the central banks have been raising interest rates and reduced funding into the property market. Such actions have reduced money in the property market and hence reduced demand and we observe that these measure do seem to be having a positive effect on the overall Vietnam balance sheet, past monthly trade deficits are now becoming trade surpluses and inflation is starting to drop. We suspect the current fiscal measure of high interest rates and reduced funding into the construction / property sectors will continue until mid 2012. Foreign Direct Investment commitments remains lower than in
2008 / 9 and furthermore the level FDI disbursement from previously committed projects has now reduced. We further suspect Overseas Development Aid disbursement and Public Sector investment to remain consistent with 2010 levels. Owing to the above factors we suspect that 2012 construction output growth will be similar or slightly lower than 2011. Notwithstanding the current economic climate there is still growth (albeit slower growth) in the construction sector and there are some very notable projects commencing construction including: • Saigon Center Phase 2 & 3 in district 1 Ho Chi Minh City. • Vietsin Commercial Development in district 1 Ho Chi Minh City. • Ben Thanh Towers in district 1 Ho Chi Minh City. • VietinBank HQ in Hanoi • UNDP HQ in Hanoi.
The industrial construction sector is also growing significantly and as is supported by focused lending in order to reduce Vietnam trade deficits. The industrial sector seems to be attracting FDI and there are a number industrial companies looking to establish operations in Vietnam. Although construction growth in 2011 have been at a slower rate than previous years we note that construction prices have generally risen in 2011 and this is largely due to price rises in local materials namely; steel, cement and aggregates.
80.00
1800
70.00
1600 1400
60.00
1200
50.00
Nos. of projects
Billions US$
Annual Foreign Investment (1998-2011)
1000
40.00
800
30.00
600
20.00
400
10.00
200
0.00
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011*
Registered Capital (bn US$)
5.10
2.57
2.84
3.14
3.00
3.19
4.55
6.84
12.00
21.30
71.73
22.63
18.60
12.70
Legal Capital (bn US$)
2.47
0.98
1.31
1.71
1.27
1.14
1.22
1.97
4.67
6.04
11.50
10.00
11.00
10.05
No. of Projects
285
327
391
555
808
791
811
970
987
1544
1557
1155
969
919
0
Note: 2011 from Jan to Nov (Source: Vietnam Investment Review)
FDI by countries as of Nov 2011
3500 3000
20.00 2500 15.00
2000 1500
10.00
1000 5.00 500 0.00 Registered Capital
Taiwan
Malaysia
Japan
S. Korea
Singapore
B.V.Islands
Hong Kong
Thailand
Canada
Brunei
23.43
9.36
23.28
23.65
23.38
14.94
10.97
5.75
4.66
4.80
Legal Capital
9.97
3.77
6.63
8.13
9.71
4.75
3.61
2.58
1.00
0.99
No. of Projects
2,203.00
393.00
1,636.00
3,072.00
973.00
497.00
654.00
266.00
114.00
122.00
(Source: Vietnam Investment Review)
Vietnam Annual ODA
billion US$ 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00
1998 2.20
1999 2.21
2000 2.40
2001 2.06
2002 2.10
2003 2.48
2004 2.27
2005 3.48
2006 3.10
2007 2.17
2008 5.43
2009 8.06
2010 7.90
2011 7.40
ODA Disbursement 1.24
1.35
1.65
1.28
1.33
1.87
1.83
1.94
1.89
1.75
2.20
4.10
3.51
3.65
ODA Commitment
Note: 2011 from Jan to Nov
(Source: Ministry of Planning and Investment)
0
Nos. of Projects
Billion US$
25.00
FDI by Sectors November 2011 23% 73% 4%
Agriculture & Forestry & Aquaculture
No. of projects
Registered Capital (mn US$)
Industry and construction
9,932
164,219.72
55,174.15
Manufacturing
7,938
92,081.11
34,223.59
Property
370
46,620.61
11,396.71
Cconstruction
815
12,438.91
3,929.68
Mining
69
2,974.77
2,370.11
68
7,396.15
1,660.97
Wholesale & Retail
646
1,998.79
1,033.00
Water supply & Waste treatment
26
709.38
560.09
492
3,185.07
1,538.66
2.3%
28,499.06 10,697.28
15.9%
Sector 1
Electricity, gas and water production and distribution
2 3
Service
Agriculture & Forestry & Aquaculture Service
3,072
Legal Capital (bn US$)
Hotel & Restaurant
313
11,808.80
IT
698
5,242.89
3,109.61
Art & Entertainment
128
3,635.91
1,102.25
Logistics
314
3,249.77
1,009.12
75
1,321.55
1,171.79
Health care
73
1,015.50
220.85
Science & Technology
1,104
969.16
496.65
Education and Training
150
354.56
123.53
Supporting services
104
187.69
96.30
113
Total
13,496
713.23 195,903.85
81.8%
3,214.28
Finance, Banking & Insurance
Others
Registered Capital (%)
152.90 67,410.09
100%
(Source: Vietnam Investment Review)
Vietnam Construction Output Table
Year
Construction Output (US$ billion)
Proportion of GDP (%)
Real Construction Output Growth (%)
2000
1.63
5.35
7.51
2001
1.94
5.8
12.78
2002
2.07
5.89
10.57
2003
2.39
6.05
10.59
2004
2.82
6.23
9.03
2005
3.35
6.35
10.87
2006
4.09
6.62
11.05
2007
4.94
6.96
12.01
2008
6.23
6.61
0.02
2009
6.19
6.65
11.36
2010
7.13
7.03
11.06
2011 - 9mths
4.84
5.94
4.91
(Collective data from General Statistics Office)
MATERIAL PRICE INDICES Steelbar (D12-D25) Year
Quarter
I II III IV I II III IV I II III IV I II III IV
2008
2009
2010
2011
Index (Base QI/2008)
VND/T 11,200,000 14,518,000 17,305,000 12,000,000 10,940,000 10,990,000 11,820,000 12,220,000 12,452,500 11,590,000 12,830,000 13,440,000 15,030,000 14,730,000 15,925,000 15,925,000
Concrete (Grade 250)
Index Inflation $VND/m 3 (Base QI/2008)
100.00 129.63 154.51 107.14 97.68 98.13 105.54 109.11 111.18 103.48 114.55 120.00 134.20 131.52 142.19 142.19
0.00% 29.63% 19.20% -30.66% -8.83% 0.46% 7.55% 3.38% 1.90% -6.93% 10.70% 4.75% 11.83% -2.00% 8.11% 0.00%
676,804 790,476 904,000 850,000 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 970,000 970,000
100.00 116.80 133.57 125.59 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 143.32 143.32
Cem ent (PCB40)
Inflation
VND/kg
0.00% 16.80% 14.36% -5.97% 3.51% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 10.25% 0.00%
976 973 1,275 1,273 1,255 1,255 1,255 1,255 1,255 1,218 1,209 1,209 1,241 1,263 1,459 1,459
Index (Base QI/2008)
Inflation
100.00 99.69 130.64 130.43 128.59 128.59 128.59 128.59 128.59 124.80 123.87 123.87 127.15 129.41 149.49 149.49
0.00% -0.31% 31.04% -0.16% -1.41% 0.00% 0.00% 0.00% 0.00% -2.95% -0.74% 0.00% 2.65% 1.77% 15.52% 0.00%
(Source: Ho Chi Minh City Departments of Construction and Departments of Finance Year 2008-2011)
160.00 150.00 140.00 130.00 120.00 110.00 100.00 90.00 80.00
I
II
III
IV
I
II
III
IV
I
II
2009
2008 Steelbar (D12-D25)
III 2010
Concrete (Grade 250)
IV
I
II
III 2011
Cement (PCB40)
IV
IMPORT DUTIES Unit
MFN / WTO
CEPT
ACFTA
Non-ACFTA
AKFTA
Non-AKFTA
AJCEP 3
VJEPA 2
AANZFTA
AIFTA
VAT Tariff
Special Tariff
Marble
kg
10
0
10
(1)
15
(2)
20
22
25
20
10
Granite
kg
10
0
10
(1)
15
(2)
20
22
25
20
10
Carpentry of Wood
kg
3
0
5
-
5
-
5
4
5
4.5
10
Porland cement
kg
34
5
-
-
-
-
-
-
30
-
10
Ceramic building bricks, flooring blocks
35
5
-
-
20
-
33
35
30
35
10
Ceramic roofing tiles
45
5
-
-
20
-
41
44
30
48
10
m2
45
5
-
-
20
-
41
44
30
48
10
Ceramic sanitary fixtures of unit porcelain
38
5
20
(3)
20
-
41
44
30
48
10
Multiple-walled insulatin units of glass
m2
25
5
10
-
-
-
30
30
25
-
10
Glass mirror (unframed)
kg
25
5
-
-
-
-
30
30
25
-
10
10
0
7
7
10
-
10
DESCRIPTION (all figures)
Ceramic floor, hearth, wall tiles
Concrete steel
kg
15
5
12.5
(4)
U,I or H section of steel (height under 80mm)
kg
10
5
18
-
-
-
29
30
-
-
10
Alluminium doors, windows, m2 frames and thresholds
15
5
10
-
10
-
13
15
15
14
10
Air conditioner (window or wall mounted) not exceeding 26,38kW
unit
32
5
20
(5)
-
-
33
35
30
29
10
Passenger lifts
unit
10
5
5
(6)
5
(6)
7
8
10
8
10
Water pump
unit
22
5
10
-
-
-
24
26
25
29
10
Electric genset not exceeding 75KVA
unit
10
0
5
(1)
5
-
7
7.5
10
8
10
MFN/WTO CEPT/AFTA ACFTA AKFTA AJCEP 3 VJEPA 2 AANZFTA AIFTA (1)
: : (3) : (4) : (5) : (5) : (2)
: Most-Favored-Nation / World Trade Organisation Normal Tax rate = Favoured Tax rate x 150% : Common Effective Preferential Tariff Scheme / ASEAN Free Trade Area : ASEAN-China Free Trade Area : ASEAN-Korea Free Trade Area : ASEAN-Japan Comprehensive Economic Partnership : Vietnam-Japan Economic Partnership Agreement : Australia-ASEAN-New Zealand Free Trade Agreement : ASEAN-India Free Trade Agreement
Cambodia, Thailand Thailand Cambodia, Malaysia Cambodia, Lao, Malaysia, Thailand Brunei, Cambodia, Philippines, Thailand Malaysia, Thailand
Where the MFN/WTO tax tariff of a goods item specified in the Import Tariff is lower than Special tariff according to different trade agreement, the import tax tariff applicable to such goods item shall be the MFN/WTO tax tariff.
ESTIMATING RULES OF THUMB Structural Design - Concrete Ratios The following is a range of concrete ratios for building superstructure design in Viet Nam Concrete/floor area Formwork/floor area Reinforcement
0.4m3/m2 2.2m2/m2 160kg/m3
to to to
0.5 m3/m2 3.0 m2/m2 250 kg/m3
Average External Wall/Floor Ratio 1.0 m2/m2 0.4 m2/m2 0.4 m2/m2
Residential Apartments Office Hotel Average Internal Wall/Floor Ratio
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
Residential Apartments Office Hotel Air - Conditioning Average
0.065
RT/m2 of floor area
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particularly small footprints. Indicative Dimensions for Sports Grounds Length
Width
Tennis Court 40 m 20 m Squash Court 13 m 6m Basketball Court 38 m 23 m Volleyball Court 30 m 20 m Badminton Court 20 m 10 m Ice Rink 61 m 26 m Soccer Pitch 110-120 m 70-80 m The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed Densities of Common Materials Concrete 2,400 kg/m3 Water Cement 1,441 kg/m3 Softwood Sand 1,600 kg/m3 Hardwood Gravel 1,350 kg/m3 Aluminium Steel 7,850 kg/m3 Soil (compact)
1,000 700 1,100 2,750 2,100
kg/m3 kg/m3 kg/m3 kg/m3 kg/m3
Concrete Strength (in accordance with TCVN 3118 - 1993) CYLINDER CUBIC CYLINDER CUBIC 15cm x 30cm 15cm x 15cm 15cm x 30cm 15cm x 15cm Psi Mpa Mpa Mpa Psi Mpa 8,000 55 66 60 8700 50 7,000 48 58 50 7300 42 6,000 41 49 40 5800 33 5,000 34 41 35 5100 29 4,000 28 34 30 4400 25 3,000 21 25 25 3600 21 8,000 55 66 20 2900 17 15 2200 13 1.00MPa = 145.04 Psi 1.00 MPa (Cylinder 15cmx30cm) = 1.20 MPa (Cubic 15cmx30cm) Reinforcement Bar Dia. Weight/m Perimeter Area (mm) (kg/m) (mm) (mm2) 6 8 10 12 16 20 25 32 40
0.222 0.395 0.616 0.888 1.579 2.466 3.854 6.313 9.864
18.85 25.13 31.42 37.70 50.27 62.83 78.54 100.53 125.66
28.27 50.26 78.54 113.10 201.06 314.16 490.88 804.25 1256.64
Composition of Concrete (per m3) Mix Cement 1:3:6 216 kg 1:2:4 308 kg 1:1:2 540 kg Average Loads Lorry (24 ton) Concrete truck (24 ton) Barge
Sand 0.45 m3 0.43 m3 0.38 m3
Aggregate 0.90 m3 0.86 m3 0.75 m3 Volume 10.0 m3 5.5 m3 200 – 1,450 m3
Dimensions for Standard Parking Space, Loading / Unloading Bays and Lay-bys Length
Width
Minimum Headroom
Private Cars, Taxis and 5m 2.5 m 2.4 m Light Vans Coaches and Buses 12 m 3.0 m 3.8 m Lorries 11 m 3.5 m 4.1 m Container vehicles 16 m 3.5 m 4.5 m Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilationi ducts, conduits or similar.
BUILDING CONTROL AND PROCEDURES Project Classification Projects are categorized based on the scale, nature and source of fund in accordance with Appendix 01 of the Decree 12/2009/ NDCP dated 02 October 2009. Special projects under the jurisdiction of the Prime Minister’s Office encompass the most national important project and or top security project. Projects classified as Group A under the jurisdiction of the Ministers of Ministries encompass infrastructure and ports (sea-ports and airports), oil and gas, cultural and sensitive projects to national defense and all projects over VND 500 billion, or equivalent to USD 25 million. Group B projects encompass all other projects and fall under the jurisdiction of Provincial People’s Commit-tees and require registration only for investment licenses and applies to projects with a manufacturing and export earnings component. A full assessment for investment licenses is required for all other projects. The table on page 89 shows the step by step licensing required for projects categorized as Group B requiring full assessment. Project Investment Appraisal Developers must carry out the project investment report (feasibility study report) and the basic design for project investment appraisal including the Planning Certificate applied to the People’s Committee of the relevant province. The information of basic design to be included encompasses address and description of land plot, function of land plot, red-line boundary and exit and connection with the existing transportation and infrastructure including power, water, storm water drainage , waste water treatment, overall dimension and existing level, construction boundary, construction density, plot ratio, schedule of land use area and schedule of floor area, maximum floor height and building height, parking lot ratios, principle of architec-tural, structure and infrastructure design, environmen-tal impact plan, fire protection plan, design standards and building codes. The project investment appraisal is in accordance with the Circulation 03/2009/ TT-BXD dated 26 March 2009. Technical Design and Detailed Design Developers using foreign design consultancies must ensure their projects undergo a Design Evaluation Assessment to the Ministry of Construction or the Chairman of the Peoples Committee of relevant province who will delegate to the Ministry of Construction or provincial Construction Department. The Technical Design and Detailed Design must be in line with the previous approved basic design including the compliance of design standards and building codes, the integrity of project, the well protection of environ-ment and the safety in the event of fire circumstances. Construction Permit Under the Law on Construction investors must first obtain a construction permit issued by the Provincial People’s Committee Construction Department prior to construction can commence. The construction permit is not required for the projects of residential develop-ment, industrial and processing zones, hi- tech parks, housing development of which the master plan 1/500 was approved by authority. There are also a few exceptions to this in case of residential developments which shall be governed by newly published laws of Residential.
The investor of residential development projects shall submit an application dossier of all the mentioned inclusion plus the certificate of EIA (Environment Impact Assessment) and Fire Protection, which are issued by the Provincial Department of National Resources and Environment and Provincial Fire Police Department respectively. An application dossier shall contain design implementation drawings and land-use right certificates and land rental contracts. The basic inclusions are mandatory and they are location and description of works, storey height and height above sea-level, site boundary demarcation, overall site plan, major cross sections, main elevations, structural framing plans and foundation designs, environmental and safety technical details, principle of materials, schematic line diagrams of infrastructure connection of power, telecommunication, water supply, storm and waste water drainage system, and quantities for key components.. Construction Permit applications will be checked against various compliances in respect of boundaries and interference with neighboring properties and approved planning (site coverage, plot ratio and car-parking). The issuing body should provide timely notice to the investor of any non-compliance for their remedy and resubmission to allow the implementation stage to commence. Site Clearance A plan for site clearance and/or resettlement shall be submitted at the same time as the application for the investment license and resettlement carried out prior to site clearance taking place for construction. The time limit for site clearance should comply with the project implementation schedule. Resettlement is based on the principle of providing similar or better conditions and governmental regulations on principles, methods and a price framework shall be adopted by the People’s Committee for determination of compensation levels. This is a matter for great uncertainty and foreign investors are advised to seek vacant possession prior to transfer of land use right to the joint venture. Supervision of Construction Independent Supervision of construction works by a competent and registered firm is a mandatory requirement. The supervisory role encompasses quality control and compliance checking, schedule control, quantification control, safety and environmental hygiene control during construction. The safety and environment control are conducted regularly and continuously during the implementation phase. The Supervisor is also responsible for arranging independent inspections witnessing of testing and commissioning data and assistance in compilation of the dossier for putting the building into operation and receipt of the Occupation Permit. Commencement of Construction Construction of works may only commence after satisfying the following conditions : the site area being ready to be handed over, either in whole or in section and free of encumbrances; a construction permit; approved design drawings for execution of building; aconstruction contract; sufficient capital funds to ensure the building schedule in accordance with the approved building schedule in the investment license; measures to ensure safety and minimum environmental impact during the construction process. Construction All Risks and Third Party Liability Insurances as well as all required insurances in accordance with conditions of contract are recommended to be effected prior to commencement of any physical construction works on Site.
contracts which are placed by the employer. This necessitates effective cost management as the total construction budget is not finalized until the final packages are let. The employer bears not an insignificant risk in terms of price certainty, delays, disruption, design and coordination problems. Clients adopting this approach need to be conversant with the local environment and have the requisite in-house skills to deal with issues as they arise. c) Framework Agreements Framework agreements referred sometimes as “call-off” contracts between investors with a “pipe-line” of projects and contractors can result in significant savings to both parties using any of the procurement options above. The advantages are time reduced for tendering and negotia-tions, improved processes and knowledge transfer, bulk order costs savings, reduced confrontation and economies of scale due to continuity of workflow. All these advantages are extremely important in the Vietnam context because it is of paramount importance to maintain healthy relation-ships between employers and contractors as unforeseen events are prevalent during the design and procurement stages in Vietnam. d) Public Private Partnership (PPP) PPP is the generic term for the relationships formed between the private sector and public bodies often with the aim of introducing private sector resources and / or expertise in order to help provide and deliver public sector assets and services. The term PPP is used to describe a wide variety of working arrangement from loose, informal and strategic partnerships to design, build, finance and operate type services contract and formal points of joint venture companies. The PPP mechanisms would help attract commercial capital and other sources of capital that private investors will seek for PPP projects. In that way, investment efficiency will be improved while public debts controlled at safe levels. Investors of projects will be chosen via competi-tive bidding in order to maximize benefits and create equal opportunities for domestic and foreign investors. On 9 November 2010 the Prime Minister of Vietnam authorized the issue of detailed regulations covering the piloting of investment in the form of Public Private Partnerships (PPPs) in Vietnam. The PPP Regulations became effective on 15 January 2011 and will continue to be implemented over the next three to five years. The Vietnamese Government intends to carry out PPP programme according to a list of defined projects to ensure that investors are provided with carefully prepared projects with a view to creating a real PPP commercial market in Vietnam. In the coming years the government will carry out some pilot projects. The PPP projects in the country will concentrate on core techni-cal infrastructure that requires much capital, and furthermore, mechanisms to mobilize private invest-ment: (i) Roads, Road bridges, road tunnels, ferry road stations; (ii) Railway, railway bridges, railway tunnels; (iii) Airports, sea ports and river ports; (iv) Clean water supply systems; water drainage systems; liquid and solid waste collection and treatment systems; (v) Power plants, electricity transmission cables; (vi) Hospitals; (vii) Other infrastructure projects.
Table A - Procurement Strategy Project Criteria Paramter
Objectives
Timing
Early Completion
Cost
Appropriateness of Contract Strategy PPP
Traditional
Management Contracting
Construction Management
Design and Construct
Prime Contracting
Pre construction price certainty
Quality
Design prestige
Variations
Avoid prohibitive cost of change
Complexity
Technically advanced or highly complex building
Responsibility
Single contractual link
Professional Responsibility
Need for design learn to report to sponsor
Risk Avoidance
Desire to transfer complete risk
Damage Recovery
Facility to recover costs direct from contractor
Build ability
Contractor input to economic construction
Table B - Risk Allocation INDICATIVE RISK ALLOCATION Contract Strategy Client
Public Private Partnerships
Design and Construct
Prime Contracting
Traditional
Framework Agreements
Management Contracting
Construction Management
Contractor
Framework Agreements
CONTRACTOR SELECTION STRATEGIES There are four tiers of contractor available for tendering foreign investment projects, these tiers are not official classifications. Tier 1
Foreign contractor from Japan, Korea, Singapore, Hong Kong, Europe Australia
Tier 2
Foreign contractor from China, Russia, Taiwan and Malaysia
Tier 3
Local private and Joint Stock contractors
Tier 4
State contractors
There is a considerable diversity between these tiers in terms of general expertise, technological know-how, human-resource skills and training which leads to a different risk profile for delivery of buildings to time, quality and cost targets. The lowest tiers use less modern equipment, machinery and system formwork and have much lower human resource costs. This is inevitably leading to higher tender returns. A rigorous pre-qualification procedure is recommended with weighted scoring in line with project objectives eg. lowest cost objective will have an inevitable impact on quality and time. A typical pre-qualification assessment might cover (indicative weighting for Vietnam 1 through 10, 10 highest) - Vietnam experience (if foreign) 8 - Project type experience (local and foreign) 7 - Financial capacity (particularly local) 8 - Plant and equipment inventory (particularly local) 7 - Direct labour strength (local and foreign) 6 - Proposed joint venture / sub-contracting arrange-ments (local and foreign) 7 - Planning and programming capability (particularly local) 8 - Cognizance of international procedures, codes and specifications (local) 8 Financial capacity (local) Local contractors now have access to bank funding but should not be expected to finance projects by punitive cash-flow arrangements. Most contracts are let with investors paying 10-15% advance payments which is re-couped from subsequent milestone or interim payments. Deductions for defective works and liquidated damages may compound problems so careful diplomacy is often more productive. Claims for additional costs due to prevailing market conditions are more common in today’s climate but also for misinterpretation of contract obligations making the need for good quality contract documentation essential. Plant and Equipment Inventory (local) State firms tend to share or pool plant and equipment for example tower-cranes and piling rigs. It is often impossible to determine the true owner of plant and equipment on-site in the event of premature demobilization.
It is essential that the pre-qualification process determines that a contractor owns plant of sufficient size, capacity and suitable state of repair as contractors may not have full control of leased equipment suddenly required on other job-sites. Direct labour strength (local) The source of labour supply, also being verified as labour strength, may be “topped-up” by importing unskilled and untrained workers from remote provinces, who often are not legally resident at their working destination. Contractors should be asked to prove their direct labour records and declare any labour only sub-contracting arrangements. The tier 1 contractors will not have any full-time dedicated labour on their payroll. Tier 2 contractors often import workers from their home country for the project duration and shall be responsible for all associated costs and taxes. Labour is not usually permitted to reside on site. Contractors shall provide details of training curriculums for each trade discipline when tendering as well as health and safety programmes. Proposed sub-contracting arrangements (local) Sub-contracting is prevalent in Vietnam so it is essential to check the percentage of work subcontracted out to ensure quality control issues are minimized. It is highly unlikely that any one firm will possess the required human resource and plant and equipment to complete a project using in-house resources. Foreign contractors largely act as management function providing only project engineers, site supervisors, health and safety officers and planners. Both foreign and local contractors rarely directly employ foremen, gang-leaders or indeed skilled and unskilled operatives. These arrangements are perfectly normal and accepted but it is preferable to know in advance the exact arrangements being proposed to ensure no conflicts of interests with other projects and to understand fully the amount of “control” the appointed contractor has on the works he is engaged to undertake. Planning and programming capability (local) This capability needs careful verification from the lowest tier contractors. The use of first principle time resourced planning is rarely used. The approach adopted is often “rule of thumb” whereby planners determine critical activity durations using their knowledge of other projects. Floor/structure cycle times are often inconsistent and the lack of recording and reutilization of historical data means the planning process can be crude at best. Time or delay is a perennial problem in Vietnam sometimes due to employer delays such as site clearance or permit issues or neutral delays such as weather but contractor culpable delays should not be of any surprise. The use of critical path analysis, planned impacted analysis, window analysis and collapsed asbuilt are not widely known in Vietnam. This means time recovery analysis and the implementation of acceleration measures are not readily adopted and time for completion can become unpredictable. The input of experienced Project Management might be invaluable in reducing delays and formulating time recovery plans.
International experience (local) The influx of foreign invested projects has brought with it an influx of different standards and procedures normally from the source country. It is essential to determine the degree of exposure local contractors have had to international standards, procedures and indeed expectations. The Vietnamese Codes and Standards whilst detailed need to be used concurrently with international standards such as American, Australian, British or Japanese standards and specifications as they are not comprehensive enough to “stand-alone” on an international standard project. There is no uniform and widely accepted standard or specification. The nett result is a hybrid where every project has a unique and bespoke set of standards depending on the investor and his consultant source country. The appointed design team will naturally look to use their familiar “off the shelf” specifications and tendering contractors should be asked to list the standards they have successfully built for the key trades and building elements. There is a move to produce a set of consolidated Vietnamese standards but this is some way off and the hybrid approach will continue for some time to come. However, no international standard shall over-ride any mandatory Vietnam building code or standard. Design consultants should provide a translated bi-lingual version of their specifications and locally registered design firms shall provide “localization” of the design to obtain local approvals. The contractors should also be asked to list investments such as system formwork and their use of recent technology and list previous employers and consultants whom they have worked with.
PROPERTY OVERVIEW OVERVIEW Similar to the economic picture in 2010, Vietnam’s economy witnessed both growth and macroeconomic instability in 2011. The yearend growth rate was 5.89%, failing to meet the target of 6%. This is approximately 0.7% lower than the growth in 2010. Inflation remained atop of many newspaper headlines during 2011, with the y-o-y average for the year ending at 18.58%. A necessary consequence of this was the tightening of monetary policy. Both factors contributing to the limited growth that was witnessed. In 2011 there was a steep devaluation of the dong after Tet, with the currency losing 9.3% of its value on Febru-ary 11 against its USD peg. From an exchange rate of 19,500VND/US$ in early January, the dong devalued to 21,021VND/US$ in late December. In the fourth quarter the State Bank of Vietnam was slowly devaluing the dong by approximately 10 dong per day. With global economies showing signs of strain at the beginning of 2012, and Vietnam continuing to resolve macroeconomic instability, many organisations are beginning the year by maintaining a cautious approach to their business and investment models. OFFICE SECTOR At the end of 2011, average Grade A rents in HCMC were US$32.16 psm per month, a y-o-y decline of just over 8%. The continued decline, represented twelve straight quarters of rental declines. Demand in early 2012 is expected to be moderate as global economies remain in limbo and as the Vietnam-ese economy continues to stabilise. Absorption 2011 will not come close to the record net absorption seen in 2010. There will, however, be an opportunity for corporate occupiers to obtain attractive rents during this period of limited activity. Looking towards late 2012. Grade A rents are expected to stabilise due to tight supply, and possibly improve if there is sustained economic growth – this is despite possible new supply from Saigon One ( M & C) and Times square. If Vietcombank Tower, and the Ben Thanh Twin Tower project come online as scheduled, within the next eight quarters, their new supply would equal approximately 32% of current Grade A supply. This will almost certainly put downwards pressure on rentals during the period. However, the Ben Thanh Twin Tower project is currently only in the compensation phase, and progress on the Vietcombank Tower is measured. Therefore, Grade A rents could appreciate in the next eight quarters as the new supply coming online in 2012 is absorbed, and future supply is a full two years, or more, away. The new Grade A projects coming online in the next eight quarters are expected to set a new level of quality, which is desired by the market and required by many multinational corporations to comply with life, health and safety standards. In this respect, occupiers of current Grade B projects are expected to take advan-tage of this opportunity to relocate into the newer, higher quality space.
RESIDENTIAL SECTOR The residential sector generated the most headlines during 2011. Developers who had moved into the development cycle, with what could often be considered speculative product, faced a market with notable levels of falling confidence during 2011. With macroeconomic policy tightening developers have had limited access to capital and with buyer appetite being low, numerous developers have faced cash flow issues through the year. Sales velocities were less than expected and as such developers had to look to adjust strategies towards the year end. There were a number of different options considered and deployed which included, the postponement/slowing of construction, the attempted sale of units en-bloc to investors, the transfer of units to serviced apartment operators, the self operation of units or discounts/incentives or various types. For a limited number of developers the measures that have been taken have provided shelter from the market conditions, but for many developers, cash flow is still a concern and it is expected that in early 2012 that the residential market will continue to provide headlines as developers navigate the tricky conditions being faced. Despite the lacklustre market conditions it is noted that overall asking prices have not fallen as much as some may have expected. On the secondary market the greatest price falls were seen in the mid-end sector where prices fell by 7.5%, where as the affordable sector saw asking prices stay stable over the year. It is however noted that the actual transactional price in both the primary and secondary market has adjusted more than the asking prices as sellers look to close prospects. RETAIL SECTOR In 2011 consumer confidence waned due to persistent high inflation. Although the Government’s efforts to contain inflation gradually worked their way through the economy, the high inflation seen through the year stifled consumer’s appetite to spend. Department store rents continued to climb as landlords felt they could charge a premium. Parkson, which continued to expand in 2011, has seen success at a number of its outlet as consumers and retailers alike have shown a preference for their format. In the first half of 2012 retail sales are expected to remain flat. Landlords, especially in shophouses and non-CBD shopping centres, will be forced by market realities to become more reasonable with their rental rates. Department stores will be able to hold their rental rates in the same period. New retail options will need to offer attractive rents to attract retailers. Through 2012 it is expected that the gap between what is provided by landlords and what is required by tenants will narrow, with more attention paid to seemingly small things such as toilets and taxi stands, foot traffic can be increased. SERVICED APARTMENT SECTOR The Serviced Apartment sector has proved to be one of the most resilient, in what has proved to be a tough year for the majority of sectors. Grade A rents have stayed stable, with less than 1% change over the year, this is a reflection of stable demand and
limited supply. With the premium Times Square project expected to come online in the second quarter of 2012, Grade A supply will increase by approximately 20%. Despite this additional new supply, Grade A rents are expected to be flat or possibly see increases. This is due to the low vacancy, as most Grade A projects have seen vacancy rates less than 10% for the last six quarters. Projects that break the trend of maintaining high rentals in the premium CBD product sector, may have an opportunity to fill their projects quicker than those that hold out for higher rents. Through 2012 demand for serviced apartments is expected to remain strong. Vietnam is an emerging destination for companies looking to place expatriate staff, with an increasing standard of living for foreigners but a lower cost of living compared to the regional hubs of Singapore and Hong Kong. Vietnam is also expected to capitalise on regional trends including the diversification of manufacturing out of Japan after the earthquake and tsunami, and the rising cost of doing business in China, where an increase in the minimum wage is pushing manufacturers to look at other areas for expansion. Recent data reported by Oxford Economics indicates that textile exports from Vietnam in the first eight months of 2011 were up 29% y-o-y, and coffee exports were up 9% y-o-y in the first seven months of 2011. This all bodes well for Vietnam, but our forecast of high serviced demand is tempered by the uncertainty surrounding the global economy at the turn of the year.As serviced apartment demand depends heavily on expatriates continuing to be posted to Vietnam, it is perhaps more directly affected by the global economy than other sectors. Since our last forecast three months ago there has been a significant increase in the likelihood of a recession in the United States and a disorganised Eurozone debt default. The uncertainty around the outcome of Greece’s sovereign debt crisis is increasing, and in the United States political posturing abdicates the will to implement the reforms necessary to stabilise the economy and promote growth. If the already fragile global recovery falters, there may be a reduction in expatriate staff, which would increase vacancy in the serviced apartment market. (Reproduced by kind permission of CB Richard Ellis)
PROJECT CLOSED OUT PROCEDURES Before an investor can receive rental income and occupy the premises for its intended use, the receipt of approval must be received by the provincial Construction Department or the Ministry of Construction depending on the category and size of the project. The Construction Department will receive a dossier complete with independent testing and commissioning data (prepared by an independent party not the original designer) for piling, structure, electricity and earthing, environmental impact with regard to water and waste disposal, final checking and approval of fire protection requirement. The dossier needs to have Minutes to Put the Building into Operation signed by the Investor, Testing Body, Contractor and Designer including the Project or Construction Manager if appointed.
TYPICAL SUBMISSION FLOWCHART LOCAL PARTNER
FOREIGN PARTNER
ESTABLISHMENT OF LEGAL COMPANY PT: 1 month AT: 1.5 month Total : 2.5 months
SUBMIT & OBTAIN IN-PRINCIPLE APPROVAL OF THE LOCATION / PROJECT FROM MASTER PLANNING DEPT.
PT: 0.5 month AT: 2 months
SIGN A JV CONTRACT & AGREEMENT FOR FUTURE TRANSFER OF ASSETS
Total : 2.5 months
SUBMIT & OBTAIN APPROVAL FOR THE DEVELOPMENT PLANS (LAND USE) FROM RESOURCES AND ENVIRONMENT DEPT. PT: 0.5 month AT: 3 months Total : 3.5 months
REGISTER A JV COMPANY - SUBMIT AND OBTAIN APPROVAL FOR RED BOOK TRANSFER FROM LOCAL PARTNER TO JV CO. FROM RESOURCES AND ENVIRONMENT DEPT.
PT: 0.5 month AT: 1.5 month
- SUBMIT AND OBTAIN APPROVAL FOR INVESTMENT LICENSE FROM DEPT. OF PLANNING & INVESTMENT
Total : 2 months
- SUBMIT AND OBTAIN APPROVAL FOR FIRE FIGHTING APPRAISAL FROM FIRE FIGHTING DEPT. - SUBMIT AND OBTAIN APPROVAL FOR ENVIRONMENTAL IMPACT APPRAISAL FROM RESOURCES AND ENVIRONMENT DEPT.
PT: 1 month AT: 4 months Total : 5 months
SUBMIT AND OBTAIN APPROVAL FOR PLANNING TASK AND PLANNING APPROVAL SCALE 1/500 FROM PEOPLE COMMITTEE OF THE DISTRICT PT: 1 month AT: 2 months Total : 3 months
SUBMIT AND OBTAIN APPROVAL FOR BUILDING PLANS FROM CONSTRUCTION DEPT.
Legend:
PT: Preparation Time AT: Approval Time
Note:
Time indicated is based on past project experience and serve as a guide only
PLOT RATIOS AND SITE COVERAGE FOR BUILDINGS (Land area over 500m2)
Average number of storeys
Maximum of Site coverage (%)
Maximum of Plot ratio
1
70
0.70
2
60
1.20
3
53
1.59
4
47
1.88
5
40
2.00
6
39
2.34
7
36
2.52
8
33
2.54
9
31
2.70
10
28
2.80
11
26
2.86
12
24
2.88
13
22
2.90
14
21
2.94
>=15
20
3.0 – 5.0
Car Parking Space Type of building - Hotel from 3-Star standard upward - High-grade office, foreign affairs offices - Super market, big shops, conference centre, exhibition, show room - High grade condominium
1 space of carparking (25m2) for every 5 guest rooms every 150m2 floor area every 75m2 floor area every apartment
KEY DESIGN CRITERIA Plot Ratios and Site Coverage I. High-rise building : Pursuant to the TCXDVN 323 : 2004 promulgated to Decree 26 dated 2 November 2004 of Ministry of Construction on “Design standard for high-rise building” and Decree No 21/2006/QD-BXD dated 19 July 2006 of Ministry of Construction on amending and supplementing articles of TCXDVN 323 : 2004 as follows : Plot Ratios and Site Coverage: - The site coverage of high-rise building must be less than 40%. - The plot ratio is less than 5.0. - Other cases will be applied to the detail planning approved by authorities. Parking space: - Car parking space: 1 car parking space / 4 to 6 units with standard area 25m2/car - Motorcycle parking space: 2 motorcycles / unit with standard area 2.5 to 3m2/motorcycle. - Bicycle parking space: 1 bicycle/ unit with standard area 0.9m2/bicycle. Height from floor to ceiling soffit : - > 3m but < 3.6m. - In some high standard building, the height from floor to ceiling soffit may be lower, but not less than 2.7m. Road for fire protection : - Width of road > 3.5m. - Clearance Height > 4.25m. - Area for making U-turn > 15x5m II. Non High-rise building : Pursuant to the Vietnamese building code volume 1 promulgated to Decree 682/BXD-CSXD dated 14 December 1996 and Decree 04/2008/QD-BXD dated 03 April 2008 of Ministry of Construction on amending and supplementing articles of TCXDVN 323 : 2004 as follows : Ratio (%) Maximum of site coverage
Minimum of Landscaping ratio
1. Dwelling House - Villa - Condominium
30 50
40 20
2. Public building - Kindergarten, School - Hospital - Culture house - Religious constructions
35 30 30 25
40 40 30 40
3. Factory - Scattered construction - Combined block
50 70
20 20
Type of building
BUILDING AREAS DEFINITIONS The following guidelines are derived from the RICS “Code of Measuring Practice: A Guide for Surveyors and Valuers. 5th Edition' and the RICS 'Standard Form of Cost Analysis, Principles, Instructions and Definitions”. Gross External Area (GEA) Gross External Area is the area of a building measured externally at each floor level. Includes: Perimeter wall thicknesses and external projections Areas occupied by internal walls and partitions Columns, piers, chimney breasts, stairwells, liftwells, and the like Atria with clear height above, measured at base level only Internal balconies Structural, raked or stepped floors are to be treated as a level floor measured horizontally Horizontal floors, whether accessible or not, below structural, raked or stepped floors Mezzanine areas intended for use with permanent access Lift rooms, plant rooms, fuel stores, tank rooms which are housed in a covered structure of a permanent nature, whether or not above main roof level Outbuildings which share at least one wall with the main building Loading bays Areas with a headroom of less than 1.5m Pavement vaults Garages Conservatories Excludes: External open-sided balconies, covered ways and fire escapes Canopies Open vehicle parking areas, roof terraces, and the like Voids over or under structural, raked or stepped floors Greenhouses, garden stores, and the like in residential property Gross Internal Area (GIA) Gross Internal Area is the area of a building measured to the internal face of the perimeter walls at each floor level. Includes: Areas occupied by internal walls and partitions Columns, piers, chimney breasts, stairwells, lift-wells, other internal projections, vertical ducts, and the like Atria with clear height above, measured at base level only Internal open-sided balconies and the like Structural, raked or stepped floors are to be treated as a level floor measured Horizontal floors, with permanent access, below structural, raked or stepped floors Corridors of a permanent essential nature (e.g. fire corridors, smoke lobbies, etc.) Mezzanine areas intended for use with permanent access Lift rooms, plant rooms, fuel stores, tank rooms which are housed in a covered structure of a permanent nature, whether or not above main roof level
Service accommodation such as toilets, toilet lobbies, bathrooms, showers, changing rooms, cleaners' rooms, and the like Projection rooms Voids over stairwells and lift shafts on upper floors Loading bays Areas with a headroom of less than 1.5m Pavement vaults Garages Conservatories Excludes: Perimeter wall thicknesses and external projections External open-sided balconies, covered ways and fire escapes Canopies Voids over or under structural, raked or stepped floors Greenhouses, garden stores, fuel stores, and the like in residential property Gross Floor Area (GFA) Gross Floor Area is the total of all enclosed spaces fulfilling the functional requirements of the building measured to the internal structural face of the enclosing walls. Includes: Areas occupied by partitions, columns, chimney breasts, internal structural or party walls, stairwells, lift-wells, and the like Lift, plant, tank rooms and the like above main roof slab Note: Sloping surfaces such as staircases, galleries, tiered terraces and the like should be measured flat on plan. Excludes: Any spaces fulfilling the functional requirements of the building which are not enclosed spaces (e.g. open ground floors, open covered ways and the like). These should each be shown separately Private balconies and private verandahs which should be shown separately Net Internal Area (NIA) Net Internal Area is the usable area within a building measured to the internal face of the perimeter walls at each floor level. Includes: Atria with clear height above, measured at base level only Entrance halls Notional lift lobbies Kitchens Built-in units, cupboards, and the like occupying usable areas Ramps of lightweight construction to false floors Area occupied by ventilation/heating grills Area occupied by skirting and perimeter trunking Areas severed by internal non-structural walls, demountable partitions, whether or not permanent, and the like, where the purpose of the division is partition of use, not support, provided the area beyond is not used in common Pavement vaults.
Excludes: Those parts of entrance halls, atria, landings and balconies used in common Toilets, toilet lobbies, bathrooms, cleaners’ rooms, and the like Lift rooms, plant rooms, tank rooms (other than those of a trade process nature), fuel stores, and the like Stairwells, lift-wells and permanent lift lobbies Corridors and other circulation areas where used in common with other occupiers or of a permanent essential nature (e.g. fire corridors, smoke lobbies, etc.) Areas under the control of service or other external authorities including meter cupboards and statutory service supply points Internal structural walls, walls enclosing excluded areas, columns, piers, chimney breasts, other projections, vertical ducts, and the like The space occupied by permanent and continuous airconditioning heating or cooling apparatus, and ducting in so far as the space it occupies is rendered substantially unusable Areas with headroom of less than 1.5m Areas rendered substantially unusable by virtue of having a dimension between opposite faces of less than 0.25m Vehicle parking areas (the number and type of spaces noted) Building Footprint ‘Building Footprint’ is not a term defined by the RICS, but is generally understood to mean the area of the land upon which the building sits (excluding all basements), measured to the outside face of external walls.
PROCUREMENT STRATEGIES Overview The primary consideration in the choice of procure-ment strategy is the need to obtain overall value for money during the entire life of the facility and each method has a different risk profile for the employer and contractor. In Vietnam the following is currently prevalent. Traditional Lump Sum Management Contracting Construction Management Design and Construct Prime Contracting Framework Agreements Public Private Partnership (PPP)
-
high extent low extent medium to high extent low extent low extent rising extent new and promoted extent
Most if not all projects in Vietnam are tendered in competition and the process is covered by the Law of Tendering promulgated in 2006 intended primarily for state projects defined as over 30% total investment capital by a state entity and for Vietnamese Privatefirms. Foreign Investors do not need to follow the Law of Tendering although it is advisable. The law recog-nizes open tendering, limited tendering and competi-tive tendering. For state projects tenders are normally sought using a “two-envelope system” i.e. technical and financial the former being opened first to check for compliances. Most foreign entities short-list tendering contractors by having a robust pre - qualification procedure for check-ing financial and technical competencies. Tenders are usually open for 90 days. The FIDIC suite of contracts is widely used for Vietnam construction contracts with the 1999 Red Book being now widely accepted. There are official translations of some of the FIDIC forms and the Vietnam Consultant Association (VECAS) is an official member of FIDIC. Most Official Development Aid (ODA) projects in Vietnam adopt FIDIC also. a) Traditional Lump Sum Most contracts are let in Vietnam on a lump sum basis using a modified FIDIC Contract which in its unamended form is a measure and value contract. This method requires appointment of independent design consultants by the employer and a sufficiently developed design preferably “frozen” prior to tender. Bills of Quantities are usually provided for “information only” to the contractor who normally provide their own quantities with their tender for comparison purposes only and only the rates are contract rates with any “errors and omissions” not being subject to remeasurement after the lump sum is finalized. Prime costs sums for nominated subcontracts for mechani-cal and electrical and lift sub-contracts are widely used. b) Construction Management This form of procurement is often portrayed as “fast-track” as tender packages are often let successively throughout the design process with no need to wait until detail design is complete. A construction management consultant is engaged normally for a fixed percentage fee to procure and manage the individual trade
LANGUAGE Vietnamese was declared the official language of Vietnam in 1945, as much as 70% of the vocabulary is borrowed from Chinese and the intonation is similar to Cantonese. It is spoken by approximately 90% of the Vietnamese population and ranked as the world’s 15th most spoken language. English, however, is widely used in the business community.
ACCOUNTING SYSTEM Foreign-invested business entities are generally required to adopt the Vietnamese Accounting System ("VAS"). If a company strictly follows the VAS, registration with the Ministry of Finance ("MoF") is not required. However, if the VAS is modified, a written approval from the MoF is required before implementation.Accounting records are required to be maintained in VND. A foreign-invested business entity can self-assess to select a foreign currency to be used for its accounting records and financial statements and notify its local tax authority. Accounting records are required in Vietnamese language, although a commonly-used foreign language can be used at the same time along with the Vietnamese language. The annual financial statements of all foreign-invested business entities must be audited by an independent auditing company operating in Vietnam. Audited annual financial statements must be completed within 90 days from the end of the year.
WORKFORCE The population of Vietnam is circa over 87 million (as the Population forecast of Vietnam stating in the book edited by General Statistics Office) with a labour force estimated at 50 million, literacy rates are one of the highest in the region. The Ministry of Labour, Invalids and Social Affairs “MOLISA” for short is responsible for all labour related issues and sets the minimum age for full-time employment is 15 years old. The minimum wage for FDI enterprises is USD 96 per month (Pursuant to the Decree No. 07/2011/NĐ-CP of the Government dated 22nd August 2011), whereas the actual monthly payment for FDI enterprises is as high as over USD 100 per month in Ho Chi Minh City. Working hours are 8 hours per day, 6 day working weeks have largely been replaced by 5 day working weeks and 12 days annual leave plus statutory public holidays. Vietnam having strong socialist origins has quite heavy protectionist policy for Vietnamese working for foreign entities and employers must pay 16% of basic salary for Social insurance plus 3% of basic salary for Health insurance, and 1% of basic salary for Unemployment insurance. The Social insurance rate will increase by 17% from 2012 to 2013 as Article No.71 of Social Insurance Law. Most staff will quote salaries net meaning their expected take-home money. Thirteenth month bonus is discre-tionary but largely expected.
SOME INTERESTING FACTS Vietnam’s history can roughly be divided into the following periods: Pre-history: from circa 400,000 years (Palaeolithic) to 4,000 years (Neolithic) ago, cultures in the area included Son Vi, Hoa Binh, Bac Son, Ha Long, and Hoa Loc. Proto-history: According to legends, Vietnam originated in the seventh century BC when the Hung Kings founded Van Lang. In the third century BC, King An Duong Vuong named founded Au Lac and ruled until 179 B.C. Chinese Occupation: Vietnam was occupied by China from the first to the tenth century A.D. Monarchy: Kings rules the area from 968 to 1945. Independence: The Socialist Republic of Vienam was founded after the 1945 revolution, when President Ho Chi Minh declared independence. French War: Vietnam battled French colo-nialism from 1858 to the August Revolution in 1945, and from 1946 to the victory at Bien Bien Phu in 1954. American War: Vietnam fought America from 1954 to Ho Chi Minh’s victory on April 30, 1975. From 1975 until now: Vietnam has been working towards development and success.
VIETNAM KEY DATA Government Country Name Head of State Government Type Head of Government Capital City Administrative Divisions Independence Legal System Official Language National Language
: The Socialist Republic of Vietnam : President : Socialist Republic : Prime Minister : Hanoi : 64 provinces and central cities : 2nd September 1945 : Based on Constitution of Vietnam : Vietnamese : Vietnamese
Geography Geographic Coordinates : 16 00 N, 106 00 E Location : South East Asia Border Countries : Cambodia 1,228 km, China 1,281 km, Laos 2,130 km Total Area : 331,210 sq km Land Area : 310,070 sq km Water : 21,140 sq km Land use : arable land 20.14% permanent crops 6.93% other 72.93% Irrigated Land : 30,000 sq km (2003) Coastline : 3,444 km (excludes islands) Land boundaries : 4,639 km Natural Resources : phosphates, coal, manganese, bauxite, chromate, offshore oil and gas deposits, forests, hydropower Climate type : tropical in south; monsoonal in north with hot, rainy season (mid-May to mid-September) and warm, dry season (mid-October to mid-March) Natural hazards : occasional typhoons (May to January) with extensive flooding, especially in the Mekong River delta People Total Population Age structure from 15 years
: 86.93 million ( 2010 est.) : 15-24 years 18.3% 24-49 years 61.4% 50 years and over 20.3% Population Growth Rate : 10.3‰ Median Age : total: 27.4 years male: 26.4 years female: 28.5 years (2010 est.) Life Expectancy : 71.94 years male: 69.48 years female: 74.69 years (2010 est.) Urban Population Hanoi : 6.56 million (2010 est.) Ho Chi Minh City : 7.4 million (2010 est.) Ethnic Groups : 54 Ethnic Groups Kinh (Viet) 86.2%, Tay 1.9%, Thai 1.7%, Muong 1.5%, Khome 1.4%, Hoa 1.1%, Nun 1.1%, Hmong 1%, others 4.1% (1999 census)
People (Cont’d) Languages
Literacy (definition: age 15 and over can read and write) Population below poverty line Labor Force Labor Force by occupation Unemployment Rate
: Vietnamese (official), English (increasingly favored as a second language), some French, Chinese, and Khmer; mountain area languages (Mon-Khmer and Malayo- Polynesian) : total population: 90.3% male: 93.9% female: 86.9% (2002 est.) : 12.3% (2009 est.) : 50.39 million : Agriculture: 49% Industry: 22% Services: 30% (2010 est.) : 6.45% (2010 est.)
Economy Monetary Unit Currency Code Exchange rate to USD Euro British Pound Average Consumer Price Index (CPI) Fiscal Year GDP (Official Exchange Rate) GDP Growth Rate GDP composition by sectors Trade Total Exports Major Exports Export Partners Total Imports (USD billion) Major Imports Commodities Import Partners International Airports Major Seaports
: Vietnamese Dong : VND dong (VND) per : 20,031 (2011 average) : 27,917 (2011 average) : 32,155 (2010 average) : 18.62% (from Jan to Nov 2011) : 1 January to 31 December : US$ 85.37 billion (First 9 months 2011) : 5.76% (First 9 months 2011) : Agriculture: 21.5% Industry: 40.66% Services: 37.84% (2011 est.) : US$ 87.2 billion (From Jan to Nov 2011) : crude oil, marine products, rice, coffee, rubber, tea, garments, shoes : US 17.7%, EU 16.8%, ASEAN 14% China 9.86%, Japan 9.74% : US$ 96.1 billion (From Jan to Nov 2011) : machinery and equipment, petroleum products, fertilizer, steel products, raw cotton, grain, cement, motorcycles : China 20.4%, ASEAN 18.3%,Korea 10.8%, Japan 8.7%, EU 6.3% : Tan Son Nhat (Ho Chi Minh City), Noi Bai (Hanoi), Da Nang (Da Nang) : Saigon, Hai Phong, Da Nang, Cam Pha, Phu My, Cai Mep
(Source: General Statistics Office)
BANKS The Vietnamese banking system was restructured in the 1990’s separating the State Bank of Vietnam (Central Bank) from commercial banks and paving the way for the entry of foreign banks presently offering a range of banking services comparable to overseas banking facilities. Today there exists the State Bank of Vietnam, State Owned Banks, Joint Stock Commercial Banks, Foreign Bank branches / representative offices and Joint Venture Banks. The law allows foreign entities and individuals to hold foreign currency accounts and local Vietnamese dong accounts. Banks requires document applicable to foreign currency transactions for domestic payment and cross border transfer via capital/current account. Banks can provide customers with all of the guarantee types commonly used in the economy such as bid bond, a performance guarantee, a loan under guarantee by a third party, a deposit guarantee , tax/custom guarantee ...Guarantee fee will be regulated by each bank and depended on guarantee amount and term. Letters of credit are the most commonly used method of transaction for trade. Bank will blockade a part or the whole money amount of client account upon receipt of decision or written request of a competent organizations according to the provisions of law.
GOVERNMENT ADMINISTRATION The National Assembly is the highest representative organ of the people and the highest organ of the state power of the Socialist Republic of Vietnam. Members are elected for a five year tenure through nation wide elections. Sittings of the National Assembly are held twice a year and have full constitutional and legislative powers. The standing committee of the National Assembly is responsible for enforcement of laws. Its functions are carried out through the Ministries, State Committees and General Departments by promulgating and explaining the Constitution, law and decree-laws. The Country’s President is the head of state, elected by the National Assembly from among its members to represent the Socialist Republic of Vietnam in internal and foreign affairs. The Vice President is proposed by the President and elected by the National Assembly from the representatives. The National Defense and Security Council has the duty to mobilize all forces and potentials of the country to defend the Homeland. The Government is the executive organ of the National Assembly and shall report to the National Assembly, the National Assembly standing committees and the Country’s President. The Government consists of the Prime Minister, Deputy Prime Minister, Ministers and Heads at ministerial level. The Prime Minister is presented by the President and elected by the National Assembly and has the term of 5 years. The Deputy Prime Ministers are the assistants of the Prime Minister and may be delegated by the Prime Minister during his absence. The Ministers and Heads at ministerial levels take on the State management of allotted branches or fields.
The People’s Supreme Court is the highest judicial organ of the Socialist Republic of Vietnam. The court consists of the Tribunal President, Vice Tribunal President, judges, the juror and the secretary of the court. Moreover, the court is composed of the judge Council, judge Committee, the Military Court and criminal court, civilian court, the court of appeal and the assistant apparatus.
TAXATION TAXATION IN THE REAL ESTATE INDUSTRY I. Corporate Income Tax (“CIT”) Organizations established in Vietnam deriving income from transferring or leasing property are subject to Corporate Income Tax (“CIT”) at the standard tax rate of 25%. In case of progressive advance payment for purchase of properties under development, real estate developers are required to pay provisional CIT, either at 25% on provisional income if the corresponding expenses can be determined and matched with the revenue, or 2% on revenue if corresponding expenses cannot be determined. Real estate developers generally cannot receive preferential tax rates, tax holidays, or other tax reductions except certain projects with available tax incentives, such as projects located in poor social-economic regions, or projects of construction of residential house for the poors or workers working at Industrial Park, etc. In the event that a lessee pays advanced rent covering several years, the lessor must allocate the advanced rent payment over the number of years for which the lessee paid in advance, effectively matching the income with the rental period for the tax purpose. However, a recent draft Decree on CIT allows the lessor to recognise revenue by two method s (i) on allocated year-by-year basis or (ii) lump-sum basis in the advanced rental collecting year with condition that the lessee shall bear all expenses incurred during the use of the property. Losses incurred in a given year can be consecutively carried forward for 5 years; however, they may not be carried back to previous years. Losses from activities other than real estate cannot be offset against real estate income in both the loss year and the carried-forward period. Land use rights (“LUR”) with indefinite term may not be depreciated as deductible expense upon taxable income determination. LUR with definite term, if accompanied by adequate invoices and documents and lawfully established, which is used in production and business activities, should be gradually amortized over the prescribed land use duration. II. Value Added Tax (“VAT”) The transfer of land use rights (“LUR”) without infrastruc-ture is not subject to VAT. The transfer of LUR with infrastructure/building is subject to VAT at 10%. However, the actual cost of land (or land rent), or the land value at the government tariff (for the case the actual land cost declared by tax payer is determined as not reliable) can be excluded from the revenue subject to VAT. Similar to the treatment of provisional advance CIT payable on advances/deposits received by the developer, output VAT is also fully payable on the advance/deposit.
All construction input VAT incurred can be claimed as input VAT credit (or cash refund during the construction stage). However, input VAT of the expenses related to the value of LUR transfer is not creditable/refundable. III. Stamp Duty Stamp duty is payable at the transfer of title of real estate property by the buyer. Some specific transfers may be exempted from the stamp duty. Stamp duty is imposed at 0.5% on the value of the property but not exceeding VND500million (approx. USD25,000) per asset per transaction. IV. Foreign Contractor Tax (“FCT”) Foreign companies with no legal entity set up in Vietnam (i.e. classified as “Foreign Contractor” or “FC”) supplying goods and services to Vietnamese buyers and deriving income from Vietnam (e.g. construction contractor or project management service) are subject to Vietnam FCT. VAT and CIT are the two components of the FCT. There are three tax filing and payment options: (i) Full registration method with maintenance of books and accounts in Vietnam under Vietnam Accounting system; (ii) Deemed Withholding method and (iii) the Hybrid method which consists of paying VAT on the conventional deduction method like a Vietnamese company, but paying CIT on a Deemed Withholding method basis. The Deemed Withholding method is the most common one in practice under which the contracting Vietnamese party is responsible for registering, withholding, filing and paying the FCT due from each payment made to the FC. The applicable rates vary depending on the nature of goods and services provided. For projects having a substantial portion of local purchases, Hybrid method is often applied via which the FCs can claim credit the input VAT incurred on local purchase, and still pays the CIT on a deemed basis. V. Personal Income Tax (“PIT”) Real estate property (other than sole residential property and some other specific exempt transactions) transfer by individual is subject to PIT. Property transactions subject to PIT include the transfer of “the right to buy”, the transfer of “the right to lease” A Vietnam tax resident has to pay PIT under one of the following two methods: (i) At 25% on the net gain assessed by the difference between the transaction price less the cost and relevant expenses; or (ii) 2% on the transfer price, if the cost can not be determined.The recent update of the relevant tax regulations indicate that (ii) above would apply in most cases. Non-Vietnamese tax residents must pay PIT at 2% of the transfer price. (Reproduced by kind permission of KPMG)
IMPORT Foreign invested entities are permitted to import materials and equipment for their projects in accordance with the conditions laid down in the foreign investment license as determined by the Ministry of Trade. Post licensing procedures involves obtaining an export-import enterprise code from the Department of Customs. Foreign entities must then submit an “Import Plan” annually to the regional service of trade which should be fully encompassing and detailed enough to avoid possible re-application and administrative delays upon arrival to the Vietnam port of entry. Machinery and equipment specified in the investment license may be imported duty free in addition to other materials not available in Vietnam otherwise foreign entities are subject to the common import restrictions and tariffs as stated in “The 2011 Export-Import tax tariff and Value Added Tax on Imports”, applicable from 01/01/2011 based on Decisions, Circulars issued by Ministry of Finance, Free Trade Agreements and published by the HCM General Publisher. This book (readily available) has twenty-one sections covering minerals, foodstuffs, plastics, wood, textiles, stone, plaster and glassware plus more and gives the applicable tariffs for most favored nation status and special preferential treatments namely ASEAN countries. In practice goods are imported under the investors name and license with material and equipment and quantity information provided by contractors.
INSURANCE Overview Most risks that a company would insure anywhere else in the world can be adequately insured for in Vietnam. Rates and terms are generally a function of the world market with due consideration given to local factors however it should be noted that VAT of 10% applies to insurance premiums on policies written within Vietnam. While the overall ability to insure large or complicated risks entirely within Vietnam is limited, the Vietnamese insurance industry can nonetheless insure any size risk through reinsurance arrangements with international reinsurance organisations. The leading reinsurers and those who carry more than 10% have to be rated at least BBB by Standards & Poors or B++ by AM Best or Baa by Moody's or equivalent. Vietnam passed a comprehensive Insurance Law in December 2000 which took effect on April 1, 2001. The Amendment of Insurance Law has been passed last year and was effective as at July 1, 2011. The key changes are focused at keeping up with any WTO commitments such as: the insurance market is profes-sional & open, foreign insurers are allowed to establish a branch in Vietnam or issue an insurance policy into Vietnam. However, the law gives the power to the government to release detailed guidance and to license such transactions. These details are yet to be released as of December 2011 Construction All Risks (CAR) insurance, including the covers for the Contract Work & Third Party Liability, is popular in Vietnam. Recently, owners of larger projects have shown interest in considering more technical coverages such as Advance Loss of Profit (ALoP) / Delay in Start-Up (DSU) insurance to protect their anticipated profit/fixed costs of a particular project.Construction insurance still tends to be left to the contractor to arrange rather than the owner which can give rise to gaps in cover when projects are delayed or split into smaller packages. There may also be gaps when the project passes from construction to operation. Compulsory Insurances in Vietnam Compulsory insurances are regulated in insurance laws & some specialised laws. Below is the consolidation: Insurance Class
Status
PI for Insurance Brokers
Waiting for guidance
PI for Lawyers
Waiting for guidance
PI for Securities Companies (Stockbrokers)
Waiting for guidance
PI for Fund Management Companies
Waiting for guidance
Insurance Class
Status
PI for Architects & Engineers
Waiting for guidance. Government project owners often required & referred to this regulation
PI for Auditing Firms
Waiting for guidance
PI for Evaluation Firms
Waiting for guidance
PI for Public Notary Offices
Waiting or guidance
Construction Works Insurance
Waiting for guidance
Compulsory Fire & Explosion Insurance
Effected. Compulsory wordings & tariff
Environmental Liability Insurance
Waiting for guidance
Aviation’s LIaility Insurance
Effected. Compulsory limits
Compulsory Vehicle Owners’ Civil Liability
Effected. Compulsory wordings, limits & tariff
Travel Insurance for Vietnamese travelling overseas
Waiting for guidance
Technically there is no requirement for worker compen-sation insurance. However since there is a liability regarding employees under the Vietnamese labour law the purchase of worker compensation insurance can act as a risk transfer method to protect against these liabilities. Market Players Insurers There are numerous domestic and foreign companies licensed to provide non-life insurance, including insurance for construction sectors in Vietnam. State-owned:Vietnam Insurance Corp (Bao Viet), Bao Minh Insurance Corp (Bao Minh) Group-controlled: Petro Vietnam Insurance JSC (PVI), Petrolimex Insurance JSC (Pjico), Post & Telecommuni-cation Insurance JSC (PTI), Global Insurance Co. (GIC), Vietnam Aviation Insurance JSC (VNI), Military Insurance Co. (MIC), SHB Vinacomin Insurance JSC (SVIC) Bank-based: Vietinbank Insurance Co. (VietInsco), BIDV Insurance Co. (BIC), Agriculture Bank Insurance JSC (ABIC) Private: Nha Rong Insurance JSC (Bao Long), Vien Dong Assurance Corp (VASS), AAA Assurance JSC (AAA), Bao Tin Assurance Corp (BAC), Hung King Insurance Corp (HKI), Great Mountant Insurance JSC (GMIC) Foreign: Gan-Groupama, QBE, Chartis, ACE, Liberty, Fubon, MSIG, Cathay Joint Venture: Bao Viet Tokyo Marine, United Insurance Co. (UIC – the JV among Bao Minh, Sompo & LG), Samsung Vina Insurance (SVI)
There is only one reinsurer: Vietnam National Insurance Corp (VinaRe). Brokers As insurance is best arranged through a licensed insurance broker who can help companies to assess the underlying risks and then arrange appropriate insurance on their behalf, there are a number of licensed insurance brokers. International: Jardine Lloyd Thompson (JLT), Aon, Marsh, Grass Savoye Willis Local: Viet Quoc, A Dong, Thai Binh Duong, Sao Viet, CIMEICO, Nam A (Reproduced by kind permission of Jardine Lloyd Thompson )
VIETNAM MAP
(Source: Wikimedia)
DOMESTIC ROUTES DISTANCE
FLIGHT TIME
MILES/KMS OUTBOUND RETURN HA NOI TO Buon Ma Thuot
569/960
1:40
1:40
Cam Ranh - Nha Trang
646/1039
1:50
1:50
Da Lat
662/1065
1:40
1:40
Da Nang
377/606
1:15
1:15
Dien Bien
187/301
1:00
1:00
Ho Chi Minh City
707/1138
2:00
2:00
Hue
341/549
1:10
1:10
Buon Ma Thuot
162/260
1:00
0:55
Ca Mau
153/246
1:00
1:05
Cam Ranh - Nha Trang
197/318
0:55
0:55
Con Son - Con Dao
130/210
1:00
1:05
Chu Lai
346/557
1:40
1:40
Da Lat
133/214
0:50
0:50
Da Nang
375/603
1:10
1:10
Ha Noi
707/1138
2:00
2:00
Hai Phong
691/1111
2:00
2:00
Hue
392/630
1:20
1:20
Phu Quoc
187/300
1:00
1:05
Pleiku
238/384
1:15
1:10
Quy Nhon
267/430
1:30
1:25
Rach Gia
121/194
0:50
0:45
Tuy Hoa
237/381
1:15
1:25
Vinh
549/883
1:45
1:45
Buon Ma Thuot
233/374
1:10
1:10
Cam Ranh - Nha Trang
271/436
1:20
1:15
Ha Noi
377/606
1:10
1:10
Ho Chi Minh City
375/603
1:10
1:10
Pleiku
141/227
0:50
0:50
Quy Nhon
171/275
1:00
1:00
HO CHI MINH CITY TO
DA NANG TO
(Source: Vietnam Airlines)
RELEVANT WEBSITES Government Office Ministry of Public Security Ministry of Home Affairs Ministry of Justice Ministry of Planning and Investment Ministry of Finance Ministry of Industry and Trade Ministry of Agriculture and Rural Development Ministry of Transport Ministry of Construction Ministry of Natural Resources and Environment Ministry of Information and Communication Ministry of Labor, War Invalid and Social Affairs Ministry of Culture, Sports and Tourism Ministry of Science and Technology Ministry of Health Ministry of Education and Training Ministry of Foreign Affairs State Bank of Vietnam General Statistics Office of Vietnam Directorate for Standards, Metrology and Quality Vietnam National Administration of Tourism Vietnam Customs Office Vietnam Register Office
http://www.chinhphu.vn http://www.mps.gov.vn http://www.moha.gov.vn http://www.moj.gov.vn http://www.mpi.gov.vn http://www.mof.gov.vn http://www.moit.gov.vn http://www.argoviet.gov.vn http://www.mt.gov.vn http://www.moc.gov.vn http://www.monre.gov.vn http://www.mic.gov.vn http://www.molisa.gov.vn http://www.cinet.gov.vn http://www.most.gov.vn http://www.moh.gov.vn http://www.moet.gov.vn http://www.mofa.gov.vn http://www.sbv.gov.vn http://www.gso.gov.vn http://www.tcvn.gov.vn http://www.vietnamtourism.com http://www.customs.gov.vn http://www.vr.org.vn
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise
HONG KONG + SHANGHAI +
BEIJING +
GUANGZHOU/ + + SHENZHEN + CHONGQING CHENGDU
3,838 2,863 2,217 2,453
1,096 822 658 987
776 528 560 993
622 439 525 605
760 480 440 800
780 500 470 1,000
2,251 2,733 2,545
987 1,316 1,206
947 1,269 1,090
760 1,044 983
860 1,100 900
940 1,250 950
N/A 2,713 3,436
1,370 1,096 2,193
N/A 1,116 1,919
N/A N/A 1,517
N/A 1,050 1,880
N/A 1,100 2,150
1,184
N/A
N/A
N/A
N/A
N/A
1,334
N/A
N/A
N/A
N/A
N/A
N/A 1,805
548 735
586 765
520 648
550 N/A
550 N/A
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E.
1,900 1,028 1,497 1,663 2,852
830 398 598 343 1,051
780 456 632 335 970
759 353 415 266 798
700 390 480 330 900
700 390 500 330 990
Exchange Rate Used : US$1 =
HK$7.8
RMB6.35
RMB6.35
RMB6.35
RMB6.35
RMB6.35
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F. & E. 5-star luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review.
+
Rates are exclusive of contingencies.
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE
MACAU Ђ
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA Ω
3,455 3,015 1,545 2,230
2,400 2,040 1,680 2,760
962 317 463 1,070
751 525 871 1,071
409 300 347 439
1,210 620 845 1,070
2,200 2,520 2,710
2,080 2,320 2,240
752 1,105 917
871 1,192 1,097
406 514 470
820 1,080 960
N/A 2,560 3,480
2,480 2,560 3,440
1,333 1,537 2,241
1,438 1,559 2,163
723 817 1,588
1,290 1,230 1,600
1,245
1,120
438
483
263
430
N/A
1,360
521
N/A
313
475
N/A N/A
960 N/A
435 530
441 N/A
252 317
410 440
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E.
1,230 910 N/A N/A N/A
1,310 760 1,055 1,160 1,770
505 286 327 413 854
N/A 494 693 793 N/A
254 222 178 228 605
480 465 590 695 1,260
Exchange Rate Used : US$1 =
MOP7.97
S$1.25
RM3.15
B$1.26
INR50
PHP43
DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F. & E. 5-star luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review. Ђ
Φ
Rates are exclusive of contingencies and any management contract fee. Rates are nett of GST and exclusive of contingencies.
� Ω
Rates based on projects in Bangalore and are nett of VAT and Service Tax. Mumbai costs are generally 8% higher. Rates are exclusive of contingencies and include 12% VAT.
PROGRESS PAYMENTS The following graph and table are an indication of the rate of expenditure for construction projects. The rate of expenditure is an average rate and will vary from project to project when specific project circumstances are taken into account. No account has been made for retention.
CONTRACT PERIOD
CUMULATIVE PROGRESS CLAIMES
CONTRACT PERIOD
CUMULATIVE PROGRESS CLAIMES
5%
1%
55%
59%
10%
3%
60%
68%
15%
5%
65%
77%
20%
7%
70%
83%
25%
10%
75%
88%
30%
14%
80%
92%
35%
21%
85%
94%
40%
29%
90%
96%
45% 50%
38%
95%
98%
48%
100%
100%
CONSTRUCTION COSTS FOR SELECTED ASIAN CITIES US$/m2 BUILDING TYPE
SEOUL $
TOKYO ♣
500 - 600 425 - 485 635 - 760 815 - 945
1,930 1,605 1,310 1,630
2,760 N/A 2,230 3,100
760 - 880 890 - 1,130 695 - 815
1,170 1,330 1,480
2,680 3,200 2,190
1,195 - 1,500 1,495 - 1,750 1,825 - 2,060
1,535 1,730 2,300
3,510 3,480 5,100
238 - 390
N/A
1,540
N/A
395 - 510
N/A
2,040
600 N/A
260 N/A
385 - 510 395 - 495
690 N/A
1,760 N/A
275 - 325 200 - 250 550 - 675 410 - 540 810 - 900
683 350 N/A N/A N/A
390 260 N/A N/A N/A
640 - 730 340 - 455 475 - 500 500 - 630 755 - 840
965 565 1,820 1,080 1,460
N/A 1,690 2,070 1,890 2,280
PKR89.42
BAHT30
IDR8,910
VND21,011
KRW1,144
JPY78.14
KARACHI
BANGKOK #
985 - 1,150 250 - 350 580 - 775 870 - 1,150
967 583 828 1,162
475 N/A 595 800
575 - 725 950 - 1,150 695 - 900
750 983 800
575 860 495
2,267 1,367 1,933
1,200 980 1,395
300 - 375
600
N/A
350 - 450
N/A
435 - 450 325 - 425
Basement carparks (< 3 levels) Elevated carparks (< 4 levels) Primary and secondary schools Student hostels Sports clubs inclusive of F.F. & E. Exchange Rate Used : US$1 =
DOMESTIC
Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels 1,965 - 2,305 3-star budget hotels, inclusive of F.F. & E. 1,125 - 1,450 5-star luxury hotels, inclusive of F.F. & E. 1,800 - 2,100 INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
JAKARTA ^ HO CHI MINH #
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries and contingencies unless otherwise stated. For latest cost information, please refer to our Quarterly Construction Cost Review. #
^
Rates are nett of VAT and contingencies. Rates are nett of VAT.
$
♣
Rates are nett of VAT and exclusive of contingencies. Rates exclude contingencies, consultant fees and consumption tax.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
GUANGZHOU/ CHONGQING SHENZHEN
HONG KONG
SHANGHAI
BEIJING
HK$/m2
RMB/m2
RMB/m2
RMB/m2
RMB/m2
RMB/m2
1,600 - 2,350 380 - 500 1,750 - 2,150 1,950 - 2,400 650 - 1,300
761 - 966 173 - 289 971 - 1,265 1,050 - 1,103 310 - 410
750 160 910 790 130 -
990 270 1,110 950 370
650 135 890 660 105 -
880 240 1,115 890 325
700 - 900 150 - 250 750 - 1,000 600 - 850 100 - 300
700 - 1,000 150 - 250 750 - 1,200 600 - 1,000 100 - 300
CHENGDU
1,300 - 1,950 450 - 850 1,500 - 2,150 1,400 - 1,950 850 - 1,300
593 305 651 520 252 -
651 431 830 651 368
460 320 705 481 253 -
670 450 898 663 386
450 260 565 450 240 -
650 400 765 610 380
450 300 550 450 250 -
650 400 700 600 350
450 300 550 450 250 -
700 400 800 700 350
270 - 380 220 - 330 800 - 1,050 270 - 380 550 - 850
110 89 368 137 168 -
163 131 488 184 226
95 95 360 140 165 -
140 140 470 200 225
105 75 325 105 125 -
140 102 410 140 220
70 70 300 70 120 -
130 120 400 130 200
70 70 300 70 120 -
130 120 400 130 200
430 250 430 430 75 -
550 300 550 550 120
226 168 289 268 47 -
320 278 399 383 116
180 140 215 215 60 -
265 215 370 370 125
190 125 230 230 55 -
295 240 345 345 105
180 150 200 220 50 -
250 250 330 330 100
180 150 200 220 50 -
250 250 330 330 100
550 450 450 650 330 -
900 600 650 850 650
275 130 215 320 160 -
540 380 485 485 320
294 145 232 327 175 -
577 400 520 520 289
250 135 200 305 105 -
410 390 390 430 230
350 150 300 300 140 -
550 350 450 400 250
350 150 300 300 140 -
600 350 500 450 250
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated.
* Generally without A/C. ** Excludes special power supply.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
MACAU
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA Ω
MOP/m2
S$/m2
RM/m2
B$/m2
INR/m2
PHP/m2
N/A N/A 1,850 - 2,150 1,600 - 2,150 550 - 650
153 29 150 158 95
-
228 136 289 214 192
350 60 280 280 200
-
455 90 450 410 283
133 17 214 152 157
-
166 29 247 181 181
3,600 - 4,700 1,600 - 2,800 4,500 - 4,850 3,500 - 4,500 2,000 - 2,500
3,000 - 4,300 650 - 1,300 3,000 - 6,000 2,500 - 3,700 1,900 - 3,000
N/A N/A 1,900 - 2,300 1,900 - 2,100 650 - 850
203 58 202 170 109
-
306 148 340 275 252
220 140 240 200 85
-
465 157 590 260 210
171 143 214 162 185
-
214 171 280 233 233
2,800 - 4,000 1,800 - 3,100 3,200 - 4,900 3,000 - 4,000 1,200 - 1,600
3,300 - 6,000 2,000 - 3,500 4,400 - 8,400 3,600 - 5,400 3,200 - 4,800
N/A N/A 850 - 1,050 300 - 400 550 - 750
31 19 97 49 75
-
71 39 136 75 159
23 36 173 23 18
-
52 45 235 30 45
12 8 45 9 28
-
29 14 62 30 44
575 - 850 375 - 650 3,000 - 4,500 825 - 1,500 1,300 - 1,800
900 - 2,000 700 - 1,200 1,750 - 3,800 650 - 1,100 1,300 - 2,600
N/A N/A 500 - 600 400 - 500 100 - 150
32 24 49 38 19
-
64 54 78 63 53
57 45 65 60 20
-
80 60 90 80 25
24 9 19 24 19
-
29 14 36 48 38
900 - 1,200 400 - 550 1,000 - 1,300 850 - 950 450 - 550
600 - 1,200 600 - 900 600 - 1,100 600 - 900 600 - 1,300
N/A N/A 500 - 700 400 - 600 400 - 500
62 46 76 83 27
-
177 114 138 200 123
88 54 85 85 63
-
400 190 370 110 105
7 3 9 9 8
-
24 14 33 27 19
650 - 900 400 - 550 800 - 1,000 800 - 1,100 500 - 700
1,600 - 2,900 N/A 1,500 - 3,000 700 - 1,700 800 - 1,500
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated.
* Generally without A/C. ** Excludes special power supply. Φ
Rates are nett of GST.
� Ω
Rates are based on projects in Bangalore and are nett of VAT and Service Tax. Mumbai costs are generally 8% higher. Transformer, included in Electrical Services.
M&E COSTS FOR SELECTED ASIAN CITIES BUILDING TYPE MECHANIAL SERVICES
Offices Industrial * Hotels Shopping Centres Apartment
ELECTRICAL SERVICES
Offices Industrial ** Hotels Shopping Centres Apartment
HYDRAULIC SERVICES
Offices Industrial Hotels
Shopping Centres Apartment
FIRE SERVICES
Offices Industrial Hotels Shopping Centres Apartment
LIFTS / ESCALATORS
Offices Industrial Hotels Shopping Centres Apartment
KARACHI
BANGKOK �
JAKARTA #
HO CHI MINH
SEOUL $
TOKYO ♣
PKR/m2
BHT/m2
IDR'000/m2
VND'000/m2
KRW'000/m2
JPY/m2
3,750 - 8,500 1,085 - 1,890 7,600 - 9,950 7,600 - 9,950 2,600 - 3,500
3,900 - 4,800 1,250 - 1,400 4,500 - 5,100 4,400 - 4,800 4,400 - 4,500
625 195 625 570 570
- 735 - 455 - 840 - 680 - 730
1,590 - 2,267 N/A N/A N/A 1,198 - 1,729
200 87 205 144 92
- 280 - 150 - 330 - 240 - 169
21,000 11,200 14,800 7,100 3,000
4,425 - 5,413 2,431 - 3,392 5,850 - 9,925 4,715 - 7,825 2,000 - 3,270
2,250 - 2,500 1,650 - 1,700 2,750 - 3,200 2,150 - 2,400 2,390 - 2,950
510 280 510 450 510
- 680 - 450 - 730 - 570 - 680
1,962 - 2,337 N/A N/A N/A 1,740 - 2,197
250 115 350 200 130
- 365 - 150 - 460 - 230 - 165
19,600 10,400 18,800 7,600 12,200
765 - 1,205 630 - 835 3,200 - 4,845 465 - 1,240 1,360 - 1,970
750 - 890 700 - 780 1,350 - 1,490 780 - 950 1,150 - 1,350
120 71 510 120 510
- 190 - 130 - 740 - 190 - 730
263 - 502 N/A N/A N/A 514 - 1,171
32 20 57 27 49
-
55 30 89 56 65
12,600 5,700 16,600 5,400 18,300
160 70 150 160 160
- 250 - 130 - 250 - 210 - 210
614 - 1,019 N/A N/A N/A 420 - 528
40 27 56 42 32
-
65 30 87 69 65
563 - 1,079 N/A N/A 1,161 - 1,642 633 - 920
45 16 110 55 27
1,285 - 1,675 1,125 - 2,025 1,285 - 2,650 1,125 - 2,025 850 - 1,350 1,745 - 3,100 1,745 - 3,100 3,500 - 8,100 1,745 - 3,100 1,745 - 3,100
760 720 750 760 760 -
850 750 850 790 850
1,000 - 1,050 N/A 1,000 - 1,100 210 - 490 450 - 500
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies unless otherwise stated. * Generally without A/C. ** Excludes special power supply. � Based upon nett enclosed area and nett of VAT. $ Rates are nett of VAT.
#
♣
270 - 740 N/A 270 - 680 205 - 540 260 - 540
- 60 - 25 - 155 - 78 - 38
Included in above
5,600 2,500 5,100 3,600 2,700
All rates are nett of VAT. Rates for Electrical Services are excluding genset. Rates for Hydraulic Services are excluding STP. Rates for Mechanical Services refer to ACMV Rates only. All costs are average. Sprinkler system, fire hose reel are included in Hydraulic Services. Smoke spill exhaust system is included in Mechanical Services. Fire alarm system, emergency PA system are included in Electrical Services.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with dine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
UNIT
HONG KONG SHANGHAI
BEIJING
GUANGZHOU/ CHONGQING SHENZHEN
CHENGDU
HK$
RMB
RMB
RMB
RMB
RMB
m3 m3 m3 m3 m3 m3 kg kg
115 110 190 * 650 900 1,130 9.8 9.8
30 25 105 168 400 470 6 6
15 18 25 120 500 560 6.3 6.3
25 30 68 155 380 465 6.2 6.2
16 18 43 120 380 420 6.3 6.3
20 25 35 130 380 420 6.3 6.3
m2 m2 m2
180 180 190
65 55 90
45 45 58
55 55 47
55 55 50
m2
600
N/A
N/A
N/A
N/A
N/A
m2
1,700
600
780 **
550
750 **
750 **
kg
25
12
11
14
12
12
kg m2
27 80
10 35
11 20
11 21
10 22
10 25
m2
95
28
22
18
17
20
m2 m2
270 430
160 170
120 140
115 157
120 130
120 130
m2
44
32
30
26
30
30
3-8
5 - 10
5 - 10
5 - 10
5 - 10
%
10 - 15
55 55 60 @
The above costs are at 4th Quarter 2011 levels and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated.
*
@
Rate including waste charges implemented on 1 Dec. 2005. Rates for 120mm thick concrete block walls.
**
Rates for double glazed window.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with fine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbong” 0.64mm profiled steel sheeting
MACAU
SINGAPORE Φ
KUALA LUMPUR
BRUNEI
INDIA �
MANILA
MOP
S$
RM
B$
INR
PHP
m3 m3 m3 m3 m3 m3 kg kg
110 105 60 580 680 730 9.5 9.5
16.5 16.5 15 50 202 Φ Φ 155 - 170 1.6 - 1.75 1.6 - 1.75
15 - 20 15 - 20 20 - 25 60 - 70 230 - 250 250 - 280 3.5 - 3.8 3.5 - 3.8
3.5 3 3 37 117 132 0.98 0.98
130 145 100 3,060 4,200 5,125 40 42
350 250 200 2,500 3,500 4,800 47 48
m2 m2 m2
160 160 250
30 - 33 30 - 33 30 - 35
30 - 38 30 - 38 32 - 45
14.5 14 18.5
425 450 700
850 800 N/A
m2
N/A
43
55 - 60
56
960
900
m2
2,000
290
350 - 500
166 - 216
kg
35
4.8- 5.8
6 - 7.5
3
75
100
kg m2
32 80
4.8 - 5.8 11
6 - 7.5 15 - 22
2.7 7.5
75 300
95 350
m2
95
15.5
15 - 22
8
230
350
UNIT
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces
m2 m2
400 460
65.5 30
50 - 70 30 - 45
23 28
1,100 850
1,200 1,300
m2
80
3.5 - 4
3.5 - 4
5
130
350
Average expected preliminaries
%
8 - 15
12 - 15
6 - 12
5-8
5 - 10
8 - 15
3,700
9,000 Ω
The above costs are at 4th Quarter 2011 levels and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated. Φ Rates are nett of GST. Φ Φ Rate for lean concrete blinding.
� Ω
Rates are based on projects in Bangalore and are nett of VAT and Service tax. Mumbai costs are generally 8% higher. Rate for aluminium with anodized finish; 6mm thick.
MAJOR RATES FOR SELECTED ASIAN CITIES DESCRIPTION
UNIT
KARACHI PKR
1. 2. 3. 4. 5. 6. 7. 8. 9.
Excavating basements ≤ 2.00m deep Excavating for footings ≤ 1.50m deep Remove excavated materials off site Hardcore bed blinded with fine materials Mass concrete grade 15 Reinforced concrete grade 30 Mild steel rod reinforcement High tensile rod reinforcement sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbong” 0.64mm profiled steel sheeting
13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
BANGKOK # JAKARTA #
HO CHI MINH #
SEOUL $
TOKYO
BHT
IDR'000
VND'000
KRW
JPY
100 100 100 600 2,000 2,400 31 30
23 30 25 270 710 850 10 10
69 64 66 306 1,352 1,730 23.3 22.2
2,100 2,100 12,000 26,500 57,000 72,000 1,070 1,080
890 940 3,140 8,100 11,200 13,200 68 83
350 350 700
120 120 120
181 223 165
23,000 23,000 40,000
3,400 3,400 13,100
m2 3,765 - 4,845
1,200
175
516
35,000
2,200
m2 5,000 - 7,500
6,000
880
2,545
249,900
23,000
385 - 635 m3 320 - 495 m3 180 - 280 m3 3 m 1,170 - 1,413 m3 5,000 - 5,500 m3 7,500 - 8,500 kg 80 - 110 kg 77 - 115 m2 m2 m2
485 - 625 550 - 790 990 - 1,060
kg
135 - 160
55
18
33.5
2,400
210
kg m2
135 - 160 425 - 590
55 200
18 44
38.5 46
1,900 2,500
320 2,600
m2
375 - 580
200
50
66.35
8,300
3,000
110 100 æ
245 300
55,000 24,000
6,100 N/A
18
62.3
7,100
900
5 - 10
8 - 12
6 - 11
10 - 15
m2 1,300 - 1,500 m2 850 - 1,250 m2
270 - 375
%
8 - 10
1,200 800 100 10 - 15
The above costs are at 4th Quarter 2011 and are based on lump sum fixed price contract rates exclusive of preliminaries and contingencies unless otherwise stated. #
Rates are nett of VAT.
æ Rate for 9mm gypsum board.
$ &
Rates include labour costs and are nett of VAT. Including undercoat and primer.
CONSTRUCTION COSTS FOR SELECTED INTERNATIONAL CITIES US$/m2 BUILDING TYPE
LOS SAN ANGELES FRANCISCO
NEW YORK
LONDON
3,600
3,700
2,420 - 3,060
4,200
4,300
4,500
3,220 - 4,420
1,650
3,400
3,500
3,800
3,600 - 5,430
1,605
1,250
3,700
3,900
4,000
2,800 - 3,520
3,585
1,850
1,600
4,200
4,400
4,500
4,000 - 5,120
2,530
1,110
1,180
2,800
3,100
3,200
1,830 - 2,390
3 star budget
3,265
2,220
1,900
2,100
2,200
2,250
1,940 - 2,340
5 star luxury
4,530
2,880
2,500
4,500
4,600
4,700
3,570 - 4,370
Resort style
4,110
2,220
3,000
4,500
4,600
N/A
Light duty factory
685
450
430
1,200
1,400
1,200
850 - 1,070
Heavy duty factory
865
575
600
1,600
1,800
1,900
1,410 - 1,760
895
535
460
850
880
900
District hospital
4,055
3,130
1,250
7,300
7,500
6,300
2,950 - 3,680
Primary and secondary schools
1,720
1,760
850
3,00
3,200
3,600
2,230 - 3,300
Exchange Rate Used (as at July 2011) US$1 =
A$0.93
NZ$1.25
ZAR7.00
US$1.00
US$1.00
US$1.00
GBP0.63
SYDNEY
AUCKLAND
JO'BURG
Average multi unit, high rise
2,845
1,770
940
3,500
Luxury unit, high rise
3,265
2,670
1,640
Individual prestige houses
3,440
2,815
Average standard offices, high rise
3,160
Prestige offices, high rise Major shopping centre (CBD)
RESIDENTIAL
COMMERCIAL/RETAIL
HOTEL
N/A
INDUSTRIAL
OTHERS
Multi storey carpark
510 - 860
The above costs are at 2nd Quarter 2011 levels. Prices excludes land, site works, professional fees, tenant fitout, equipment and GST/VAT. Hotel rate includes FF&E. Large fluctuation in exchange rates can create short tem anomalies.
CONSTRUCTION FLOOR AREA (CFA) DEFINITION The construction floor area measured from drawings is defined as covered floor areas fulfilling the functional requirements of the building measured to the outside face of the external walls or external perimeter. It includes floor ares occupied by: ○ partitions ○ columns ○ stairwells ○ lift shafts ○ plant rooms ○ water tanks ○ balconies ○ utilities platforms ○ vertical ducts ○ service floors higher than 2.2m and the like But excludes floor areas occupied by: ○ bay windows ○ planters projecting from the building, and ○ the areas covered by canopies, roof eaves and awnings Sloping surfaces such as staircases, escalators and carpark ramps are to be measured flat on plan.
The measurement of construction floor area is as defined by Langdon & Seah.
FINANCIAL DEFINITIONS & FORMULAE Discount Rate The rate of return a developer expects when investing in a project. i.e. opportunity cost Internal Rate of Return (IRR) The IRR may be defined as the interest rate that equates the present value of expected future cash flows to the cost of the investment. The IRR can be compared to the Discount Rate. Net Present Value (NPV) The NPV is the present value of all future cash flows, discounted back to today’s values at the Discount Rate. The NPV indicates in today’s dollars the profit or loss a developer makes above or below his required profit (based on a nominated Discount Rate). 72 Rule The approximate number of years required to double your capital can be calculated by dividing the interest rate into 72. e.g.
If interest rate = 10% p.a. Then 72 ÷ 10 = 7.2 years It will take approximately 7.2 years to double your capital if it is invested at 10% p.a.
Future value of $1
FV = PV (1+i)n
Future value of $1 per period
FV = PMT [((1+i)n – 1) ÷ i]
Sinking fund (the amount required to be put away periodi- PMT = FV [i ÷ ((1+i)n – 1)] cally to realise some future sum) Present value of $1
PV = FV [1÷ (1+i)n]
Present value of $1 per period
PV = PMT [((1+i)n – 1) ÷ (i(1+i)n)]
Annuity with a PV of $1
PMT = PV[(i(1+i)n) ÷ ((1+i)n - 1)]
PV FV PMT n i
= = = =
present value future value payment amount period (e.g. 10 years with monthly payments, n = 10 x 12 = 120) = interest rate per period (e.g. 12% p.a. compounded monthly; i = 12% ÷ 12 months = 1% per period)
MORTGAGE REPAYMENT TABLE Based on: * 1,000 units of currency * Interest compounded monthly * Equal monthly repayments REPAYMENT (years)
Interest p.a.
5
10
15
20
5%
18.87
10.61
7.91
6.60
6%
19.33
11.10
8.44
7.16
7%
19.80
11.61
8.99
7.75
8%
20.28
12.13
9.56
8.36
9%
20.76
12.67
10.14
9.00
10%
21.25
13.22
10.75
9.65
11%
21.74
13.78
11.37
10.32
12%
22.24
14.35
12.00
11.01
13%
22.75
14.93
12.65
11.72
14%
23.27
15.53
13.32
12.44
15%
23.79
16.13
14.00
13.17
16%
24.32
16.75
14.69
13.91
17%
24.85
17.38
15.39
14.67
18%
25.39
18.02
16.10
15.43
19%
25.94
18.67
16.83
16.21
20%
26.49
19.33
17.56
16.99
21%
27.05
19.99
1 8.31
17.78
22%
27.62
20.67
19.06
18.57
23%
28.19
21.35
19.82
19.37
24%
28.77
22.05
20.58
20.17
25%
29.35
22.75
21.36
20.98
Example Borrow $1,000,000 to be repaid monthly at 10% p.a. over 10 years. Repayments = 1,000,000 / 1,000 x $13.22 = $13,220 per month
PRIME RATES & BASE LENDING RATES as at 4th Quarter 2011
Country
Rate (%)
Australia*
4.50
Brunei China**
5.50
Egypt***
10.25
Hong Kong India
6.90 5.00 14.75
Indonesia Japan^
6.00
Macau
5.25
Malaysia
6.60
New Zealand^^ Pakistan^^^
1.60
10.01 13.97
Philippines
5.74
Singapore
5.38
South Africa
9.00
South Korea+ Thailand++
3.25 7.71
United Kingdom
0.50
United States of America Vietnam+++
3.25 9.00
* Over Night Cash Rate ** 3-Year Benchmark Lending Rate *** Overnight Lending Rate ^ Long Term Prime Rate % pa (Implementation 10-Dec-2010) ^^ SME Overdraft Rate (Previously Businesss Base Lending Rate) ^^^ Weighted Average Lending Rate + Base Rate of The Bank of Korea ++ Minimum Loan Rate % pa (Average Based on Local Bank) +++ Minimum and in VND per year Source: DLS branches Central Bank of Egypt (www.cbe.org.eg) Reserve Bank of New Zealand (www.rbnz.govt.nz) Bank of England (www.bankofengland.co.uk) www.economagic.com www.investec.com www.money-rates.com
UTILITY COSTS FOR SELECTED ASIAN CITIES EXCHANGE RATE
WATER
ELECTRICITY
FUEL
DOMESTIC
COMMERCIAL/ INDUSTRIAL
DOMESTIC
COMMERCIAL/ INDUSTRIAL
DIESEL
LEADED
UNLEADED
US$1=
US$/kWh
US$/kWh
US$/m 3
US$/m 3
US$/litre
US$/litre
US$/litre
Hong Kong
HK$7.80
0.10
0.11
0.83
0.59
1.52
N/A
2.05
Shanghai
RMB6.35
0.097(peak) / 0.048(normal)
0.16(peak) / 0.077(normal)
0.46
0.60
1.17
N/A
1.19 - 1.26
Beijing
RMB6.35
0.07
0.13
0.63
0.98
1.08
N/A
1.13
Guangzhou
RMB6.35
0.09
0.17 / 0.14
0.20
0.43 / 0.29
0.84
N/A
1.04
Shenzhen
RMB6.35
0.1066
0.525
1.177
N/A
1.089 - 1.271
Macau
MOP7.97
0.11
0.66
1.48
N/A
1.99
Kuala Lumpur
RM3.15
0.069 - 0.144
0.57
N/A
0.60
Singapore
S$1.25
0.22
0.22
1.44
1.67
1.27
N/A
1.75
Jakarta
IDR8,910
0.089
0.102
0.250
0.475
0.475
N/A
0.505
Bangkok
BHT30.00
0.044 - 0.096
0.951
N/A
1.074
Manila
PHP43.00
0.20 - 0.27
1.095
N/A
1.243
Brunei
B$1.26
0.008 - 0.12
0.057 - 0.159 0.087 - 0.349 0.484 - 0.524
0.302
0.404
0.421
Ho Chi Minh
VND21,000
0.082 - 0.141 / 0.051 - 0.092
0.995
N/A
0.99 - 1.014
Bangalore
INR50.00
0.078 - 0.196
0.112 - 0.352 3.083 - 5.507 4.142 - 6.829
0.921
N/A
1.457
New Delhi
INR50.00
0.098 - 0.167
0.123 - 0.229 3.304 - 5.288 4.865 - 7.932
0.82
N/A
1.328
Karachi
PKR89.42
0.078 - 0.16
0.16 - 0.23
1.105
N/A
0.983
Seoul
KRW1,146
0.155
0.0879
0.311
1.475
1.61
N/A
1.73
Tokyo
JPY78.14
0.277
0.277
2.726
5.170
1.459
N/A
1.639
CITY
0.091
0.048 - 0.183 0.361 - 0.721 0.12
0.54
0.110 - 0.137 0.181 - 0.635 0.657 - 0.724
0.054 - 0.056 0.274 - 0.466 0.306- 0.510 0.21
0.56 - 0.65
0.21 - 0.50
1.32
0.65 / 0.35
0.175 - 0.319 0.292 - 0.529
The above costs are at 4th Quarter 2011 levels
Basis of Charges in Hong Kong, China ○ Water Domestic : 12 - 43m3 = US$ 0.53/m3; 0 - 12m3 = Free of charge; Above 62m3 = US$ 1.16/m3 43 - 62m3 = US$ 0.83/m3;
○
Electricity (Based on tariff scheme of CLP Holding Limited) Domestic (bi-monthly consumption) 0 - 400kWh = US$ 0.10/kWh; 400 - 1,000kWh = US$ 0.11/kWh; 1,000 - 1,800kWh = US$ 0.12/kWh; Above 1,800kWh = US$ 0.13/kWh
Basis of Charges in Shenzhen, China ○ Water Domestic : Within 22m3 = US$ 0.361/m3; 23 - 30m3= US$ 0.541/m3; 31m3 and above = US$ 0.721/m3 Commercial : US$ 0.525/m3 Industrial : US$ 0.525/m3 ○ Electricity Commercial : US$ 0.158/kWh Industrial : Peak = US$ 0.183/kWh; Normal = US$ 0.138/kWh; Off-peak = US$ 0.048/kWh ○ Unleaded Fuel 90# = US$1.089/litre; 93# = US$1.174/litre; 97# = US$1.271/litre Basis of Charges in Macau, China ○ Water Domestic :
○
3
Other charges (Depending on meter size 15mm - 200mm) : Meter rental = US$0.33 - 58.07/month; Minimum consumption fee = US$2.22 - 383/month Commercial/ Industrial : Charges for ordinary users (e.g. Business, government buildings, schools, associations, hospitals and others) only. Special users (e.g. gaming industries, hotels, saunas, golf cources, construction, public infrastructures and other temporary consumption) are excluded. Electricity E l e c t r i c i t y t a r i ff a r e c o m p o s i t i o n o f d e m a n d c h a r g e s , c o n s u m p t i o n charges, fuel clause adjustment and government tax.
Basis of Charges in Beijing and Guangzhou, China ○ Unleaded fuel rate is for Unleaded gasoline 97. Basis of Charges in Shanghai, China ○ Unleaded Fuel 93# = US$1.19/litre; 97# = US$1.26/litre Basis of Charges in Kuala Lumpur, Malaysia Unleaded fuel rate is for Unleaded petrol Ron 95.
○
Basis of Charges in Singapore (All rates are nett of GST) Domestic water rate includes conservation tax and water-borne fee and is an average for the 1st 40m3, exclude sanitary appliance fee. ○ Non-domestic water rate includes conservation tax and water-borne fee, exclude sanitary appliance fee. ○ Electricity tariff is based on low tension power supply. ○ Unleaded fuel rate is for 98 Unleaded petrol as at 15 November 2011. ○ Diesel fuel rate as at 15 November 2011.
○
Basis of Charges in Bangkok, Thailand Unleaded fuel rate is for Gasohol 95.
○
Basis of Charges in Manila, Philippines ○ Water Domestic : 32m3 - 52m3/month Commercial/Industrial : 3,204m3/month ○ Electricity Domestic : 100kWh - 533kWh Commercial/Industrial : 222,600kWh Water and Electricity actual billing includes miscellaneous charges such as Environmental Charge, Currency Exchange Rate Adjustment (CERA), VAT, etc. Basis of Charges in Brunei Electricity (Domestic) : Tariff effective from 1st Jan 2012. 1-10 kWh 10c, 11-60 kWh 8c, 61-100kWh 12c, above 100kWh 15c
○
Basis of Charges in Ho Chi Minh, Vietnam (All rates are VAT inclusive) Water Domestic : Used in norm = US$ 0.21; Used over norm = US$ 0.50 Industrial = US$0.35 Commercial = US$0.65 ○ Electricity Domestic electricity rates are applied to the 301 KW above wards ○ Fuel : Diesel fuel D.O - 0.05% : 92 and 95 Unleaded petrol as at October 2011.
○
Basis of Charges in Karachi, Pakistan Fuel : The diesel fuel rate is for High Speed Diesel. : The unleaded fuel rate is for Premier Petrol.
○
Basis of Charges in Seoul, Korea Water Domestic = US$0.939/month (basic rate) + US$0.311/m3 (Within 30m3 usage) Commercial = US$77.39/month (basic rate) + US$1.475/m3 (Within 100m3 usage) ○ Electricity Domestic = US$4.757/month (basic rate) + US$0.155/kWh (500kWh below in use) Commercial = US$5.243/month (basic rate) + US$0.0879/kWh (within 1,000kWh, 3,300V - 66,000V)
○
Basis of Charges in Tokyo, Japan (All rates are VAT inclusive) Water Domestic : Rates for 30mm diameter of water piping + Basic rate of US$41.64. Commercial / Industrial : Rates for 100mm diameter of water piping + Basic rate of US$1,146.28. ○ Electricity 0kWh - 120kWh = US$0.217/kWh; 120kWh - 300kWh = US$0.277/kWh; Over 300kWh = US$0.292/kWh Basic rate = US$3.309 - 10A (ampere); US$9.927 - 30A (ampere); US$19.855 - 60A (ampere) is added.
○
IDD CODES LOCATION
Australia: Melbourne Perth Sydney Bahrain Bangladesh (Dhaka) Bhutan (Thimphu) Brunei: Bandar Seri Begawan Kuala Belait Cambodia (Phnom Penh) Canada: Toronto (Metropolitan) Vancouver China: Beijing Guangzhou Hong Kong Macau Shanghai Shenzhen France (Paris) India: Bangalore Chennai New Delhi Mumbai Indonesia: Bali Jakarta Ireland: Cork Dublin Japan: Tokyo Osaka Kazakhstan (Almaty) Korea (Seoul) Korea (Pyongyang) Laos (Vientiane)
IDD COUNTRY CODE
AREA CODE
61 61 61 973 880 975
3 8 2 2 2
673 673 855
2 3 23
1 1
416 604/250/ 778
86 86 852 853 86 86 33
10 20 21 755 1
91 91 91 91
80 44 11 22
62 62
361 21
353 353
21 1
81 81 7 82 850 856
3 6 727 2 2 21
LOCATION
Malaysia: Johor Bahru Kota Kinabalu Kuala Lumpur Kuching Penang Mongolia (Ulaanbaatar) Myanmar (Rangoon) Nepal (Kathmandu) New Zealand: Auckland Wellington Pakistan (Karachi) Philippines (Manila) Qatar Singapore Spain: Barcelona Girona South Africa: Johannesburg Cape Town Sri Lanka (Colombo) Russia (Moscow) Taiwan (Taipei) Thailand: Bangkok Phuket United Arab Emirates: Abu Dhabi Dubai United Kingdom: London Edinburgh USA: Los Angeles New York Vietnam: Ho Chi Minh City Hanoi
Source : www.worldtimeserver.com ; www.worldtimezone.com www.timeanddate.com
IDD COUNTRY CODE
AREA CODE
60 60 60 60 60 976 95 977
7 88 3 82 4 11 1 1
64 64 92 63 974 65
9 4 21 2 -
34 34
93 972
27 27 94 7 886
11 21 1 495 2
66 66
2 76
971 971
2 4
44 44
20 131
1 1
213 212
84 84
8 4
WEIGHT AND MEASURES Metric Measures and Equivalents LENGTH
1 millimetre (mm) 1 centimetre (cm) 1 metre (m) 1 kilometre (km)
AREA
1 sq cm (cm2) 1 sq metre (m2) 1 hectare (ha) 1 sq km (km2)
= 10 mm = 100 cm = 1,000 m
= 100 mm2 = 10,000 cm2 = 10,000 m2 = 100 ha
VOLUME / CAPACITY
1 cu cm (cm3) 1 cu decimetre (dm3) 1 cu metre (m3) 1 litre (l ) 1 hectolitre (hl )
= 1,000 cm3 = 1,000 dm3 = 1 dm3 = 100 l
MASS (WEIGHT)
1 milligram (mg) 1 gram (g) 1 kilogram (kg) 1 tonne (t)
= 1,000 mg = 1,000 g = 1,000 kg
Imperial Measures and Equivalents LENGTH
1 inch (in) 1 foot (ft) 1 yard (yd) 1 mile 1 int. nautical mile
= 0.0394 in = 0.3937 in = 1.0936 yd = 0.6214 mile
1 sq inch (in2) 1 sq foot (ft2) 1 sq yard (yd2) 1 acre 1 sq mile (mile2)
= 0.1550 in2 = 1.1960 yd2 = 2.4710 acres = 0.3861 mile2
VOLUME / CAPACITY
1 cu inch (in3) 1 cu foot (ft3) 1 fluid ounce (fl oz) 1 pint (pt) 1 gallon (gal)
= 0.0610 in3 = 0.0353 ft3 = 1.3080 yd3 = 1.76 pt = 21.997 gal
MASS (WEIGHT)
1 ounce (oz) 1 pound (lb) 1 stone 1 hundredweight (cwt) 1 ton
= 0.0154 grain = 0.0353 oz = 2.2046 lb = 0.9842 ton
Temperature Conversion
USA Liquid Measure Equivalents
1 fluid ounce 1 pint (16 fl oz) 1 gallon
= 1.0408 UK fl oz = 0.8327 UK pt = 0.8327 UK gal
o
= 0.5506 l
= 29.574 ml = 0.4723 l = 3.7854 l
= 144 in2 = 9 ft2 = 4,840 yd2 = 640 acres
= 6.4516 cm2 = 0.0929 m2 = 0.8361 m2 = 4,046.9 m2 = 2.59 km2
AREA
USA MEASURES AND EQUIVALENTS
USA Dry Measure Equivalents 1 pint = 0.9689 UK pint
= 12 in = 3 ft = 1,760 yd = 2,025.4 yd
= 2.54 cm = 0.3048 m = 0.9144 m = 1.6093 km = 1.853 km
o
C
o
o
C = 5/9 ( F - 32)
F
= 20 fl oz = 8 pt
= 16.387 cm3 = 0.0283 m3 = 28.413 ml = 0.5683 l = 4.5461 l
= 437.5 grains = 16 oz = 14 lb = 112 lb = 20 cwt
= 28.35 g = 0.4536 kg = 6.3503 kg = 50.802 kg = 1.016 t
= 1,728 in3
o
o
F = (9/5 C) + 32
CONVERSION GUIDE Conversion Formulae To use the conversion formulae simply multiply the Imperial measurement by the factor beside the conversion you wish to make. For example 6 inches into milimetres. 6 inches multiplied by 25.4 equals 152.4 milimetres. Conversely if you wish to convert Metric measure into Imperial measure simply divide by the same factor. LENGTH To Convert mili-inches into micrometres inches into milimetres inches into centimetres inches into metres feet into milimetres feet into centimetres feet into metres yards into metres fathoms into metres chains into metres furlongs into metres miles, statute into kilometres miles, nautical into kilometres
Multiply by 25.4 25.4 2.54 0.0254 304.8 30.48 0.3048 0.9144 1.8288 20.1168 201.168 1.609344 1.852
VOLUME & CAPACITY To Convert cubic inches into cubic centimetres cubic inches into litres cubic feet into cubic metres cubic feet into litres UK pints into litres UK quarts into litres cubic yards into cubic metres UK gallons into litres UK gallons into cubic metres UK fluid ounces into cubic centimetres
Multiply by 16.387064 0.016387 0.0283168 28.316847 0.5682613 1.1365225 0.7645549 4.54609 0.0045461 28.413063
AREA To Convert square inches into square milimetres square inches into square centimetres square feet into square centimetres square feet into square metres square yards into square metres square yards into (0.01 hectare) acres into square metres acres into hectares square miles into square kilometres
Multiply by 645.16 6.4516 929.0304 0.092903 0.836127 0.0083613 4046.8564 0.4046856 2.589988
MASS To Convert grains into miligrams grains into metric carats grains into grams pennyweights into grams ounces into grams ounces troy into grams ounces into kilograms pounds into kilograms stones into kilograms hundredweights into kilograms tons into kilograms tons into metric tonnes tahils into grams kati into kilograms
Multiply by 64.79891 0.323995 0.064799 1.555174 28.349523 31.103477 0.0283495 0.4535924 6.35023932 50.802345 1016.0469 1.01605 37.799 0.60479
POWER To Convert foot pounds-force per second into watts horsepower into watts foot pounds-force per second into kilowatts horsepower into kilowatts horsepower into metric horsepower
Multiply by 1.35582 745.7 0.001356 0.7457 1.01387
PUBLIC HOLIDAYS 2011 MALAYSIA
New Year’s Day** 01 Chinese New Year 03 - 04 Prophet Muhammad’s Birthday 15 Labour Day 01 Wesak Day 17 King/Agong’s Birthday 04 Hari Raya Aidilfitri* 30 - 31 National Day 31 Malaysia Day 16 Hari Raya Qurban* 06 Deepavali* 26 Awal Muharram 27 Christmas Day 25
2012
Jan 01 Feb 23 - 24 Feb 05 May 01 May 05 Jun 02 Aug 19 - 20 Aug 31 Sep 16 Nov 26 Oct 13 Nov 15 Dec 25
Jan##
Jan# Feb## May May Jun Aug## Aug Sep## Oct Nov Nov Dec
* Subject to change ** Except Johor, Kelantan, Kedah, Perlis & Terengganu # Except Kelantan & Terengganu ## The following day will be an additional Public Holiday
2011 BRUNEI
New Year’s Day** Chinese New Year Prophet Muhammad’s Birthday** National Day Royal Brunei Armed Forced Ann. Israk Miraj** His Majesty’s Birthday** First Day of Ramadhan* Ann. Revelation of the Holy Koran* Hari Raya Aidilfitri* Hari Raya Aidilfitri* (2nd day) Hari Raya Aidil Adha* & ** First Day of Hijrah* & ** Christmas Day*
Kashmir Day Eid-e-Milad-un-Nabi* (Birth of Prophet) Pakistan Day Labour Day Independence Day Eid al-Fitr (End of Ramadan)* Allama Muhammad Iqbal Day Eid-ul-Azha* (Feast of the Sacrifice) Ashoura* Quaid-e-Azam’s Birthday *Subject to change
05 16
Feb Feb
05 05
23 Mar 23 01 May 01 14 Aug 14 30 Aug- 01 Sep 19 - 21 09 Nov 09
Jan Feb Feb Feb May Jul Jul Aug Aug Aug Aug Nov Nov Dec
02 23 06 23 31 18 16 21 06 20 21 26 15 25
Jan Jan Feb Feb May Jun Jul Jul Aug Aug Aug Oct Nov Dec
Fridays and Saturdays are government off days * Subject to change ** Replacement for Fridays / Sundays CHINA
PAKISTAN
01 03 15 23 31 29 16 01 17 30 31 07 28 25
2012
Feb Feb Mar May Aug Aug Nov
07 - 09 Nov 26 - 27 Oct 06 - 07 Dec 24 - 25 Nov 25 Dec 25 Dec
New Year’s Day@ Chinese New Year’s Eve Chinese New Year* Tomb-Sweeping Day** Labour Day+ Dragon-Boat Festival# Mid Autumn Festival National Day^
01 02 03 - 04 05 01 06 12 01 - 03
Jan 01 Feb 22 Feb 23 - 24 Apr 04 May 01 Jun 23 Sep 30 Oct 01 - 03
@ 2nd and 3rd Jan are holidays, 31 Dec is working day. * 25th to 28th Jan are holidays. ** 2nd and 3rd Apr are holidays, 31st Mar and 1st Apr are working days. + 29th and 30th Apr are holidays, 28th Apr is working day. # 22nd and 24th Jun are holidays. ^ 4th to 7th Oct are holidays.
Jan Jan Jan Apr May Jun Sep Oct
PUBLIC HOLIDAYS 2011 MACAU
New Year’s Day* The first working day after New Year’s Day# Lunar New Year Eve (Afternoon) Lunar New Year Ching Ming Festival Good Friday The day following Good Friday* Easter Monday# Labour Day The Buddha’s Birthday* The first working day after the Buddha’s Birthday# Tung Ng Festival The first working day after the Tung Ng Festival# Bank’s Holiday The day following Chinese Mid-Autumn Festival National Day Chong Yeung Festival All Soul’s Day Feast of the Immaculate Conception* The first working day after the Feast of the Immaculate Conception# Macao SAR Establishment Day Winter Solstice* Christmas Eve Christmas Day Bank’s Holiday New Year’s Eve (Afternoon)#
01
Jan
2012
01
Jan
02 Feb Feb 23 - 25 Apr 04 Apr 06 Apr 07 Apr 09 May 01 May 28
Jan Jan Apr Apr Apr Apr May Apr
06
Jun
30 23
Apr Jun
01
Jul
25 02
Jun Jul
13 01 - 03 05 02
Sep Oct Oct Nov
01 01 23 02
Oct Oct^ Oct Nov
08
Dec
08
Dec
20 22 24 25 - 26 27 -
Dec Dec Dec Dec Dec -
10 20 21 24 25 26 31
Dec Dec Dec Dec Dec Dec Dec
02 03 - 05 05 22 23 25 01 - 02 10
* Not applicable to Bank # Special Holiday Granted by Chief Executive. ^ As the day following Chinese Mid-Autumn Festival and National Day fall on the same day, one additional holiday will be granted following the National Day.
2011 HONG KONG
The First day Of January Lunar New Year’s Day Ching Ming Festival Good Friday Easter Monday Buddha’s Birthday Labour Day Tuen Ng Festival HKSAR Establishment Day The day following Chinese Mid-Autumn Festival National Day Chung Yeung Festival Christmas Day
2012
01 03 - 05 05 22 - 23 25 10 01 - 02 06 01
Jan 01 Feb 23 - 25 Apr 04 Apr 06 - 07 Apr 09 May 28 May 01 Jun 23 Jul 01
Jan# Jan Apr Apr Apr Apr May Jun Jul#
13 01 05 25 - 27
Sep 01 Oct 01 Oct 23 Dec 25 - 26
Oct* Oct* Oct Dec
# When public holiday falls on Sunday, the following Monday is an alternative holiday. * As the day following Chinese Mid-Autumn Festival and National Day fall on the same day, one additional holiday will be granted following the National Day. INDONESIA
New Year’s Day Chinese New Year (Imlek) Prophet Muhammad’s Birthday Hindu Day of Quiet (Nyepi) Good Friday Waicak Day (Buddha Birthday) Ascension Day of Jesus Christ Ascension Day of Prophet Muhammad* National Independence Day Idul Fitri* Idul Adha Day Hijriyah New Year Christmas Day * Subject to change
01 03 15 05 22 17 02
Jan Feb Feb Mar Apr May May
01 23 05 23 06 06 17
Jan Jan Feb Mar Apr May May
29 17 30 31 06 27 25
Jul Aug Sep Sep Nov Dec Dec
17 17 19 20 26 15 25
Jun Aug Aug Aug Oct Nov Dec
PUBLIC HOLIDAYS 2011 INDIA
New Year’s Day Sankranthi Republic Day Good Friday May Day Independence Day Gandhi Jayanthi Karnataka Formation Day Deepavali Christmas Day
01 14 26 22 01 15 02 01 26 25
Jan Jan Jan Apr May Aug Oct Nov Oct Dec
2012
01 14 26 06 01 15 02 01 13 25
Jan Jan Jan Apr May Aug Oct Nov Nov Dec
2011 KOREA
New Year’s Day Lunar New Year (Seol) Independent Movement Day Buddha’s Birthday Children’s Day Memorial Day Liberation Day Full Moon Day (Chuseok) National Foundation Day Christmas Day
2012
Jan 01 Feb 23 - 24 Mar 01 May 28 May 05 Jun 06 Aug 15 Sep 29 - 01 Oct 03 25 Dec
Jan Jan Mar May May Jun Aug Oct Oct Dec
01 21 22 09 01 12 31 30 07 30 25 30
Jan Apr Apr Apr May Jun Aug Aug Nov Nov Dec Dec
01 05 06 09 01 12 19 30 26 30 25 30
Jan Apr Apr Apr May Jun Aug Aug Oct Nov Dec Dec
21 01 31
Aug Nov Dec
21 01 31
Aug Nov Dec
01 02 - 04 01 10 05 06 15 11 - 13 03 25
PHILIPPINES (Regular Holidays) Regular Holidays JAPAN
New Year’s Day* Coming of Age Day National Foundation Day* Spring Equinox Day* Day of Showa* Constitution Memorial Day* Greenery Day* Children’s Day* Marine Day Respect-for-Senior-Citizens Day Autumnal Equinox Day* Physical Fitness Day Cultural Day* Labor Thanksgiving Day* The Emperor’s Day*
01 10 11 21 29 03 04 05 18 19 23 10 03 23 23
Jan Jan Feb Mar Apr May May May Jul Sep Sep Oct Nov Nov Dec
02 09 11 20 30 03 04 05 16 17 22 08 03 23 23
Jan Jan Feb Mar Apr May May May Jul Sep Sep Oct Nov Nov Dec
*When Public Holiday falls on Sunday, the following Monday is an alternative holiday.
New Year’s Day Maundy Thursday Good Friday Araw ng Kagitingan Labour Day Independence Day End of Eid-ul-Fitre National Heroes’ Day Eid-ul Adha Bonifacio Day Christmas Day Rizal Day Special Holidays (Non Working Holidays)
Ninoy Aquino Day All Saint’s Day Last Day of the Year
PUBLIC HOLIDAYS 2011 SINGAPORE
New Year’s Day Chinese New Year Good Friday Labour Day Vesak Day National Day Hari Raya Puasa Hari Raya Haji Deepavali* Christmas Day
01 03 - 04 22 01 17 09 30 06 26 25
2012
Jan 01 Feb 23 - 24 Apr 06 May 01 May 05 Aug 09 19 Aug Nov 26 13 Oct Dec 25
Jan^ Jan Apr May May Aug Aug^ Oct Nov Dec
*Subject to changes ^ The following Monday will be a public holiday TAIWAN
01 Founding Day 02 Lunar New Year’s Eve 03 - 07 Lunar New Year Replacement Holiday 28 Peace Memorial Day Woman Day and Children’s Day 04 05 Ching Ming Festival 01 Labour Day 06 Dragon Boat Festival 12 Mid-Autumn Festival 10 Double Ten Day Replacement Holiday
Jan 01 Feb 22 Feb 23 - 27* 27 Feb 28 Apr 04 Apr 04 May 01 Jun 23 Sep 30 Oct 10 31
Jan Jan Jan Feb@ Feb Apr Apr May Jun Sep Oct Dec#
* As 4-Feb is adjusted to work, this day is adjusted to holiday. @ As 3-Mar is adjusted to work, this day is adjusted to holiday. # As 22-Dec is adjusted to work, this day is adjusted to holiday.
2011 THAILAND
New Year’s Day 03 Chinese New Year* 03 Makha Bucha Day 18 Chakri Memorial day 06 Songkran Festival 13 - 15 National Labour Day 02 Coronation Day 05 + Royal Ploughing Ceremony Day 13 Visakha Bucha Day 17 # Mid Year Bank Holiday 01 Asarnha Bucha Day 15 Khao Phansa Day (Buddhist Lent)+ 18 H.M. The Queen’s Birthday 12 Chulalongkorn day 24 H.M. The King’s Birthday 05 Constitution Day 12 New Year’s Eve 31
2012
Jan 02 Feb 23 Mar 07 Apr 06 Apr 13 - 16 May 01 May 07 May 09 May 04 Jul 01 Jul 02 Jul 03 Aug 13 Oct 23 Dec 05 Dec 10 Dec 31
Jan1 Jan Mar Apr Apr2 May May3 May Jun Jul Aug Aug Aug4 Oct Dec Dec Dec
*Unofficial Chinese Community Only # Banks only + Government only 1 Substitute for 31 Dec 2011 (Sat) 2 Substitute for 14 Apr (Sat) 3 Substitute for 05 May (Sat) 4 Substitute for 12 Aug (Sun) VIETNAM (Normal Scheduled Holidays)
Solar New Year Lunar New Year Hung Vuong King Celebration Liberation Day of Saigon International Labour Day National Day Christmas Day * Substitute for 1 Jan (Sun) ** Substitute for 22 Jan (Sun) # Substitute for 31 Mar (Sat) ^ Substitute for 2 Sep (Sun)
03 03 - 07 12 02 03 02 25
Jan 02 Feb 23 - 26** Apr 02 May 30 May 01 Sep 03 Dec 25
Jan* Jan Apr# Apr May Sep^ Dec
ABOUT US First established in 1934 in Singapore under the name "Waters and Watson" we survived the Second World War to become the pre-eminent Quantity Surveying and Construction cost Management firm in Asia - operating for many years as Langdon Every and Seah. One of our early partners, Mr. Seah Mong Hee, was the first Chartered Surveyor (RICS) in the world. Our Hong Kong office opened in 1949 and we quickly established ourselves as the leading firm in the profession. Following a series of global mergers, Davis Langdon & Seah International was founded in 1990. As we begin 2012, Davis Langdon & Seah has grown to almost 3,000 staff in 40 offices across Asia, and continues to cooperate with Davis Langdon in Europe & Middle East, USA, Australia & New Zealand and Africa - forming a network of over 100 offices across more than 30 contries. We entered the China market in 1984, introducing modern cost management techniques to its newly evolving construction market. Our initial commissions were from Hong Kong and foreign developers investing in China, although we have since then further developed our client base to include state owned enterprises and local privatedevelopers. We now have 16 offices across China located in Hong Kong, Shanghai, Beijing, Guangzhou, Shenzhen, Macau, Chongqing, Wuhan, Tianjin, Shenyang, Chengdu, Foshan, Hangzhou, Dalian, Sanya and Suzhou with a total staff count of around 1,400. For over 60 years, DLS Hong Kong/China has been proactively providing world-class construction consulting services for all types of building and infrastructure projects. We are committed to further extending our professional expertise to related fields and further expanding our activities in China to support the needs of our clients as they explore one of the world's largest and fastest growing markets.
QUALITY MANAGEMENT SYSTEM Nowadays an effective Quality Management System is one of the core elements in any kind of business. Davis Langdon and Seah Hong Kong Limited aims to provide not merely quantity surveying services but also the highest quality services to meet clients' requirements. We launched our Quality Management System in 1993 and have continually upgraded our quality standards since then. Davis Langdon & Seah Hong Kong Limited achieved certification to ISO 9001: 1987 by the Hong Kong Quality Assurance Agency in October 1994 to cover quantity surveying services. We were certifies to ISO 9001: 1994 in October 1995. The following further displays our commitment to the continual improvement of our Quality Management System: (i) June 2009 saw Davis Langdon & Seah Hong Kong Limited being certified to the ISO 9001: 2008 standard. (ii) In December 2009, the Hong Kong office of Davis Langdon & Seah China Limited was certified to the ISO 9001:2008 standard. (iii) In September 2010, Davis Langdon & Seah Macau Limited was certified to the ISO 9001:2008 standard. Plans are currently well advanced to further extend our HKQAA ISO certification to all our offices in China.
CONSTRUCTION COSTS FOR HONG KONG HK$/m 2 BUILDING TYPE
BUILDING
SERVICES
TOTAL
DOMESTIC
Public rental housing, high rise Private housing estates, high rise Private luxury apartments, high rise Terraced houses Individual prestige houses
6,055 14,035 15,805 19,065 27,485
- 6,810 - 14,780 - up - 20,490 up
1,045 2,455 3,325 2,255 2,455
-
1,350 3,320 4,220 2,860 3,610
7,100 - 8,160 16,490 - 18,100 19,130 up 21,320 - 23,350 29,940 up
12,340 - 13,350 16,470 up 11,840 - 14,770 16,420 up
4,150 4,850 4,700 4,900
-
5,280 6,130 5,430 6,130
16,490 - 18,630 21,320 up 16,540 - 20,200 21,320 up
15,070 - 16,630 21,470 up
4,930 5,330 -
5,700 6,550
20,000 - 22,330 26,800 up
OFFICE/COMMERCIAL
Average standard office, high rise Prestige offices, high rise Average standard shopping centres Prestige shopping centres HOTELS
3-star budget hotels, inclusive of F.F. & E. 5-start luxury hotels, inclusive of F.F. & E. INDUSTRIAL
Light duty flatted factories, 7.5 kpa (150lb.) loading Heavy duty flatted factories and warehouses, 15 kpa (300 lb.) loading
6,980 -
7,410
1,750 -
2,330
8,730 -
9,740
7,640 -
8,590
2,000 -
2,580
9,640 - 11,170
1,300 2,050 3,000 3,150 5,350
2,050 2,850 3,950 3,950 6,900
OTHERS
Carparks, above ground Primary and secondary schools International schools Student hostels Sports clubs inclusive of F.F. & E. The above costs are at 4th Quarter 2011 levels.
6,210 9,120 10,960 8,790 15,270
- 6,480 - 9,330 - 11,680 - 10,060 - 16,970
-
7,510 11,170 13,960 11,940 20,620
-
8,530 12,180 15,630 14,010 23,870
M&E COSTS FOR HONG KONG HK$/m 2 BUILDING TYPE
MECHANICAL ELECTRICAL SERVICES SERVICES
FIRE LIFTS/ HYDRAULIC SERVICES ESCALATORS SERVICES
TOTAL SERVICES
DOMESTIC
Public rental housing, high rise Private housing estates, high rise Private luxury apartments, high rise Terraced houses Individual prestige houses
-450 - 550 650 - 850 850 - 1,050 1,100 - 1,300 1,050 - 1,300 850 - 1,100 850 - 1,050 850 - 1,400 1,050 - 1,500
75 75 75 55 55
-
120 120 120 110 110
200 - 250 330 - 550 450 - 650 ---
320 550 650 500 500
-
430 750 850 600 600
1,045 - 1,350 2,455 - 3,320 3,325 - 4,220 2,255 - 2,860 2,455 - 3,610
430 430 430 430
-
550 550 550 550
550 650 650 650
270 270 270 270
-
380 380 380 380
4,150 - 5,280 4,850 - 6,130 4,700 - 5,430 4,900 - 6,130
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Average standard shopping centres Prestige shopping centres
1,600 - 1,950 1,900 - 2,350 1,950 - 2,150 1,950 - 2,400
1,300 - 1,650 1,600 - 1,950 1,400 - 1,600 1,600 - 1,950
-
750 900 750 850
HOTELS
3-star budget hotels, inclusive of F.F. & E. 5-start luxury hotels, inclusive of F.F. & E.
1,750 - 1,950 1,500 - 1,750 1,850 - 2,150 1,750 - 2,150
430 - 550 430 - 550
450 - 550 450 - 650
800 - 900 850 - 1,050
4,930 - 5,700 5,330 - 6,550
INDUSTRIAL
Light duty flatted factories, 7.5 kpa (150 lb.) loading
380 - 500
450 - 650
250 - 300
450 - 550
220 - 330
1,750 - 2,330
Heavy duty flatted factories and warehouses, 15 kpa (300 lb.) loading
380 - 500
650 - 850
250 - 300
500 - 600
220 - 330
2,000 - 2,580
250 250 250 350 450
250 150 150 150 250
150 250 250 600 350
1,300 - 2,050 2,050 - 2,850 3,000 - 3,950 3,150 - 3,950 5,350 - 6,900
OTHERS
Carparks, above ground Primary and secondary schools International schools Student hostels Sports clubs inclusive of F.F. & E. The above costs are at 4th Quarter 2011 levels.
200 - 550 450 - 650 550 - 850 850 - 1,050 1,300 - 1,600 1,050 - 1,400 650 - 850 1,400 - 1,600 2,500 - 3,000 1,800 - 2,500
-
300 350 350 450 600
-
350 250 250 250 350
-
200 350 350 800 450
BUILDING COST TRENDS IN HONG KONG INDEX
(Base = 100, at Year 1970)
YEAR Q1
Q2
Q3
Q4
2000
1,079
1,057
1,040
1,020
2001
990
960
945
935
2002
915
890
875
840
2003
855
878
895
895
2004
940
952
933
930
2005
945
955
963
970
2006
970
980
985
990
2007
1,020
1,074
1,175
1,150
2008
1,239
1,360
1,355
1,281
2009
1,245
1,242
1,253
1,273
2010
1,297
1,315
1,342
1,367
2011
1,385
1,425
1,452
1,476*
* Provisional Historical TPI values from 1970 onwards available at www.dlsqs.com.
INDEX
(Base = 100, at Year 1970)
YEAR Q1
Q2
Q3
Q4
2000
959
873
858
844
2001
862
842
807
721
2002
687
742
692
733
2003
720
723
722
681
2004
685
712
704
701
2005
711
716
718
697
2006
714
730
751
789
2007
821
859
906
998
2008
1,118
1,305
1,401
1,262
2009
1,074
983
1,111
1,107
2010
1,134
1,161
1,249
1,266
2011*
1,273
1,320 * Up to Q2 only
Source: Architectural Services Department, Hong Kong, SAR Refer to www.archsd.gov.hk for further information.
YEAR
HYD CONST. COST INDEX
(Nov. 1975 Value = 100)
CEDD CIVIL ENGINEERING WORKS INDEX
(1980 Value = 100)
2000
844
419
2001
838
416
2002
839
416
2003
848
419
2004
871
428
2005
869
429
2006
886
436
2007
917
450
2008
1,031
500
2009
950
461
2010
989
481
2011*
1,061
518
* 1/11 to 8/11 only Source: Civil Engineering and Development Department, Hong Kong, SAR Refer to www.cedd.gov.hk/eng/index.htm for further information.
LABOUR INDEX IN HONG KONG
INDEX
(Base = 100, at June 1995)
YEAR Q1
Q2
Q3
Q4
2000
152
153
154
154
2001
152
152
152
151
2002
150
150
149
148
2003
147
146
146
143
2004
143
140
140
138
2005
137
136
133
132
2006
131
133
134
136
2007
137
135
131
130
2008
129
128
128
129
2009
129
128
129
130
2010
131
131
131
132
2011*
133
134
* Up to Q2 only Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information. Figures above are the quarterly average of the monthly indices
MATERIAL PRICES IN HONG KONG GALVANIZED MILD STEEL ANGLE
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
REBAR
SAND
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
ORDINARY PORTLAND CEMENT
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
Source: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
COPPER GRADE A
CRUDE OIL
Source: International Monetary Fund Refer to www.imf.org for further information.
Source: Organization of the Petroleum Exporting Countries (OPEC) Refer to www.opec.org for further information.
ESTIMATING RULES OF THUMB AND DESIGN NORMS FOR HONG KONG CFA TO GFA RATIO Building Type
AVERAGE PILING RATIO - BORED PILES CFA : GFA
Building Type
m2 CFA / m2 cross section area of piles
Residential
1.15 to 1.25 : 1
Office / Commercial
1.15 to 1.25 : 1
Residential
200 - 300
Hotel
1.30 to 1.45 : 1
Office / Commercial
200 - 250
Hotel
200 - 300
FUNCTIONAL AREA DISTRIBUTION IN 5-STAR HOTELS Functional Area
% of Total Hotel CFA
AVERAGE PILING RATIO - DRIVEN H-PILES
Front of House
15 - 20%
Building Type
m2 CFA / No. of piles
Guestroom Floors
50 - 60%
Residential
50 - 90
Back of House
25 - 30%
Office / Commercial
50 - 80
Hotel
50 - 90
DIMENSIONS OF TYPICAL GRADE A OFFICE SPACE Component Distance from curtain wall to core wall Population Average waiting interval for lifts
Dimension 9 - 13 m 9 m2 usable floor area/person 30 - 40 seconds
DENSITY OF BASIC MATERIALS FOR STRUCTURE Material
2,400 kg/m3
Cement
1,450 kg/m3
Sand
1,600
Aggregate
1,600 kg/m3
Steel
7,843 kg/m3
kg/m3
Barge
m2 CFA / No. of piles
Residential
70 - 120
Office / Commercial
70 - 110
Hotel
70 - 120
All pile ratios are for high-rise buildings with normal soil conditions.
BUILDING STRUCTURE - CONCRETE RATIO Concrete/floor area
0.4 m3/m2 to 0.5 m3/m2
Formwork/floor area
2.2 m2/m2 to 3.0 m2/m2
Reinforcement
160 kg/m3 to 250 kg/m3
AVERAGE EXTERNAL WALL/FLOOR RATIO
AVERAGE LOADS VOLUME Concrete truck (24 ton)
Building Type
Density
Concrete
Lorry (24 ton)
AVERAGE PILING RATIO - PRE-BORED H-PILES
10.0 m3 5.5 m3 200 - 1,450 m3
Residential Apartments
1.0 m2/m2
Office, Hotel
0.4 m2/m2
Industrial
0.4 m2/m2
DIMENSIONS OF PARKING SPACES
AVERAGE INTERNAL WALL/FLOOR RATIO
Residential Apartments Office Hotel
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particularly small foot prints. AVERAGE LIGHTING LEVEL Building Type
Lux
Residential Office Retail Hotel School
300 500 400 300 300 - 500
Type of Vehicle
Length
Minimum Width Headroom
Private Cars and Taxis
5m
2.5 m
2.4 m
Light Goods Vehicles
7m
3.5 m
3.6 m
Medium/Heavy Goods Vehicle
11 m
3.5 m
4.7 m
Container Vehicles
16 m
3.5 m
4.7 m
Coaches and Buses
12 m
3.5 m
3.8 m
8m
3m
3.3 m
Light buses
Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilation ducts, conduits or similar
AVERAGE POWER DENSITY Building Type
VA/m2 CFA
Residential Office Retail Hotel - Accommodation Hotel - F&B Area School
80 - 100 70 300 - 400 30 550 50
AVERAGE COOLING LOAD Building Type
Residential Office Retail Hotel School
m Cooling Area/RT 2
18 - 23 14 - 18 12-14 23 23
INDICATIVE DIMENSIONS FOR SPORTS GROUNDS Length
Width
Tennis Court
40 m
20 m
Squash Court
10 m
6.4 m
Basketball Court
34 m
20 m
Volleyball Court
36 m
20 m
Badminton Court
20 m
10 m
Ice Rink
61 m
26 m
120 m
90 m
Soccer Pitch
The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed.
CONSTRUCTION ACTIVITY IN HONG KONG
YEAR
* #
COMPLETED m2
CONSENT TO COMMENCE m2
2000
1,515,000
1,850,000
2001
1,354,000
1,388,000
2002
1,908,000
1,372,000
2003 #
1,587,000
1,683,000
2004 #
1,720,000
1,115,000
2005 #
1,227,000
1,476,000
2006 #
1,389,000
1,398,000
2007 #
1,030,000
1,539,000
2008 #
1,097,000
997,000
2009 #
815,000
1,075,000
2010 #
1,139,000
1,210,000
2011 #*
750,000
791,000
1/11 to 9/11 onl y As from January 2003 onwards, statistics by Buildings Department on "Consent to Commence" are published with 2 sub-divisions, viz. "First Submission" and "Major Revision". Details can be found in the Buildings Department's "Monthly Digest".
Source: Census and Statistics Department, Hong Kong, SAR Buildings Department, Hong Kong , SAR Refer to www.censtatd.gov.hk and www.bd.gov.hk for further information.
CONSTRUCTION VALUE IN HONG KONG
YEAR
VALUE IN NOMINAL TERMS HK$ MILLIONS
VALUE IN CONSTANT (2000) MARKET PRICE HK$ MILLIONS
2000
122,071
114,691
2001
113,986
111,385
2002
106,000
108,677
2003
99,032
106,274
2004
93,171
100,615
2005
90,851
98,275
2006
90,230
96,269
2007
92,866
96,844
2008
99,599
97,024
2009
100,944
93,683
2010
111,274
100,278
2011*
91,332
78,106
* 1/11 to 9/11 only Source:
Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
FIREE RECORDALS TRACKER: NOVEMBER 2011 UPDATE Since May 2007, any injection of foreign capital in foreigninvested real estate enterprises (FIREEs) must be recorded with the PRC Ministry of Commerce (MOFCOM). These “FIREE recordals” provide a useful perspective on the trend and pace of new foreign capital inflow into the China real estate sector. However, the FIREE recordal statistics do not disclose the actual amount of foreign capital involved in each transaction. Baker & McKenzie has been tracking FIREE recordals announced by MOFCOM since May 2007. Set out below are some FIREE recordal statistics and data current up to the end of November 2011. In summary: ○ The total number of FIREE recordals for November 2011 was 95, up from 60 in October 2011. ○ The total number of FIREE recordals in 2008, 2009 and 2010 were 1,051, 991 and 1,094 respectively. ○ Since May 2007, cumulatively, there have been 5,614 FIREE recordals up to the end of November 2011. This includes 2,486 cases of new project operating entities being established, 2,562 cases of capital increase or M&A transactions (involving capital increase) related to existing project operating entities, and 238 cases of M&A transactions which do not involve any capital increase. 1.
FIREE recordals: monthly from 1 Jan 2009 to 30 Nov 2011:
2.
Cities with the highest number of FIREE recordals from May 2007 to Nov 2011:
3.
Types of FIREE recordals from May 2007 to Nov 2011:
About the FIREE Recordal Regime The regulatory regime for recording foreign-invested real estate enterprises was first established in May 2007 by MOFCOM and the State Administration of Foreign Exchange (SAFE). This “FIREE recordal” regime was part of a scheme of regulatory measures introduced between 2006 to 2007 to monitor and control foreign investment in the real estate sector at a time when the central government considered the real estate sector to be overheated. This regime controls all types of foreign capital inflow being injected into the real estate sector for purposes such as the setting up of new entities, capital increases and mergers & acquisitions. Foreign capital flowing into China cannot be converted into Renminbi (China’s legal currency) unless and until the “FIREE recordal” process has been completed with MOFCOM and SAFE. Since July 2008, the provincial-level commerce authorities have been charged with the primary responsibility of vetting the legal compliance of FIREE-related transactions. MOFCOM reserves the right to conduct random checks on the recordals filed by the provincial-level commerce authorities. Generally, within one to two weeks of receiving an electronic submission from a provincial-level commerce authority, MOFCOM will release the new FIREE recordal on its public website. Only then can the local bureau of SAFE and the local commercial bank credit the foreign currency funds into the accounts of the transaction parties concerned. In December 2008, MOFCOM further simplified the local recordal procedures such that the general office of the provincial governemnt is no longer required to jointly endorse the recordal form with the provincial-level commerce authority. In December 2010, MOFCOM announced Notice 1542, which requires local bureaus of MOFCOM to use the FIREE recordal regime to slow down new foreign investment into the PRC real estate sector.
Provided by : Mr. Rico Chan
Partner Baker & McKenzie Hong Kong Office +852 2846 1971 [email protected]
Ms. Barbara Li
Partner Baker & McKenzie Beijing Office +86 10 6535 3824 [email protected]
HONG KONG GENERAL CONSTRUCTION INSURANCE This section provides general information regarding construction insurance arrangements in Hong Kong. It is common place for Hong Kong construction contracts to contain provisions as to insurances such as Employees Compensation Insurance, Third Party Liability Insurance, Works Insurance and, on occasion, Professional Liability Indemnity Insurance. For employers, the insurance placement ensures that the contractual indemnities are backed by a financial institution that can afford to pay. For contractors, it provides a certain degree of protection to ensure that he has the means to pay in the event of mishaps. The insurances may be effected by the contractor (Contractor Controlled Insurance Programme or CCIP) or be taken out by the employer (Employer Controlled Insurance Programme or ECIP). CCIP tends to be the most common insurance arrangement in Hong Kong, since the contractor is in control of all site operations and in a better position to manage its own site safety / risk. As a poor safety record will count against the contractor in premiums negotiation in the procurement of insurance, CCIP provides an incentive for better safety / risk management. On the other hand, ECIP placement leaves the control of the insurance programme in the hands of the employer, thereby offering the advantage of providing comprehensive insurance coverage on a project-wide basis and hence minimizing overlaps and gaps in insurance coverage. Employees Compensation Section 40(1) of the Employees Compensation Ordinance states that no employer shall employ any employee unless there is a policy of Employees Compensation Insurance in place. The maximum penalty for failing to comply with HK$100,000. Under the Ordinance, the principal contractor shall take out insurance for his employees and all of the employees of subcontractors with a limit of indemnity of HK$200 million per event (or HK$100 million if the number of employees is less than 200). Since an injured worker could attempt to sue the employer, the employer will want to ensure the contractor has taken out insurance in joint names with the employer. Contractors' All Risks Insurance A Contractors' All Risks policy generally comprises (i) Third Party Insurance which covers injury to persons (except the Contractor’s own workmen) or damage to property (other than the Works), due to the carrying out of the Works which may or may not be caused by a default of the contractor. The policy is normally subject to a maximum reimbursement per incident but unlimited in the number of incidents, (ii) Contract Works Insurance which covers damage caused to the Works itself by risks not excluded from the policy and (iii) Plant & Equipment Insurance which covers the contractor’s plant and equipment used in the Works. Plant & Equipment Insurance is not normally required under the contract conditions and is voluntarily purchased by the contractor.
ACMV COSTS FOR VARIOUS DESIGNS AND DEVELOPMENTS IN HONG KONG
Professional Indemnity Insurance For construction contracts involving contractor’s design, it is not uncommon for the employer to require the contractor and his design consultants and independent checking engineers to obtain insurance to cover their liability for design. For Government Contracts, the Professional Indemnity Insurance shall cover the contractor's liability for design generally for the construction period and a further 6 years.
SPECIFIED FORMS FOR BUILDINGS ORDINANCE OR REGULATIONS FOR HONG KONG FORM NO.
PURPOSE
RELEVANT SECTION OF REGULATION
BA1
Application for inclusion in the authorized persons' register / structural engineers' register / geotechnical engineers' register. BOs 3(6)
BA1A
Application for retention of name in the authorized persons' register / structural engineers' register / geotechnical BOs 3(9B) engineers' register.
BA1B
Application for restoration of name to the authorized persons' register / structural engineers' register / geotechnical BOs 3(12) engineers' register.
BA2
Application for registration as a general building contractor / specialist contractor.
BOs 8B
BA2A
Application for renewal of registration as a registered general building contractor / registered specialist contractor.
BOs 8C(2)
BA2B
Application for restoration of name to the register of general building contractors / specialist contractors.
BOs 8D(2)
BA2C
Application for approval of technical director / other office / person appointed to act for the purposes of the Building BOs 8B Ordinance for a registered general building contractor / registered specialist contractor.
BA4
Notice of appointment of authorized person and/or registered structural engineer and/or registered geotechnical engineer. B(A)R 23(1A)
BA5
Application for approval of plans of building works and/or street works, and certificate of preparation of plans.
B(A)R 29(1) & 18A
BA6
Stability certificate of authorized person and/or registered structural engineer.
B(A)R 18
BA7
Notice of urgent works required as a result of accident or emergency.
BOs 19(3), B(A)R 28
BA8
Application for consent to the commencement and carrying out of building works or street works.
B(A)R 31
BA9
Application for renewal of consent to the carrying out of building works or street works.
BOs 20(2)
BA10 BA11
Notice of appointment of registered contractor, notice of commencement of building works or street works and undertaking B(A)R 20 by registered contractor. Notice from a registered contractor on ceasing to be appointed in respect of building works or street works and certificate B(A)R 24 in respect of that part of the building works or street works carried out by the registered contractor.
BA12
Certificate on completion of building works resulting in a new temporary building, a new building or part of a new building B(A)R 25, BOs 21(2) and application for temporary occupation permit in respect of such building or part.
BA13
Certificate on completion of building works resulting in a new building and application for permit to occupy such building. B(A)R 25, BOs 21(2)
BA14
Certificate on completion of building works not resulting in a new building or street works.
B(A)R 25 & 26
BA14A
Certificate on completion of demolition works
B(A)R 25
BA15
Notice of intended material change in the use of a building.
BOs 25(1)
BA16
Application for modification of and/or exemption from the provisions of the Buildings Ordinance and/or Regulations made thereunder.
BOs 42(2)
BA17
Application for permit to erect a temporary building.
B(P)R 51
BA18
Application for permit to erect a contractor's shed.
B(P)R 53(1)
BA19
Application for permit to erect hoardings, covered walkways or gantries.
B(P)R 64
BA20
BA22
Notice of technically competent person or persons appointed to supervise demolition works. B(DW)R 8(3) Notice of nomination by authorized person or registered structural engineer or registered geotechnical engineer of another authorized person or registered structural engineer or registered geotechnical engineer to act in his stead during B(P)R 23(2) temporary inability to act. Application for authorization to carry out and/or maintain groundwater drainage works. BOs 28B(1)
BA23
Application for grant/renewal of licence for an oil storage installation.
B(OSI)R 6(1) & 7(3)
BA24
Notification to the Building Authority of change of business address of authorized person / registered structural engineer / registered general building contractor / registered specialist contractor.
B(A)R 45
BA21
Source : Buildings Department, Hong Kong, SAR. Refer to www.bd.gov.hk for further information.
SUMMARY OF BUILDING REGULATIONS FOR HONG KONG DESCRIPTION
NUMBER OF REGULATIONS
Administration
48
Appeal
14
Construction
93
Demolition Works
13
Energy Efficiency
6
Oil Storage Installations
12
Planning
72
Private Street and Access Roads
28
Refuse Storage Chambers and Chutes
25
Standards of Sanitary Fitments, Plumbing, Drainage Works and Latrines
91
Ventilating Systems
7
Source: Buildings Ordinance, Hong Kong, SAR Refer to www.legislation.gov.hk for further information.
PERCENTAGE SITE COVERAGE AND PLOT RATIOS FOR HONG KONG DEFINITION Class A Site
OPEN SPACE ABOUT DOMESTIC BUILDINGS
:
Not being a class B or class C site, that abuts on one street not less than 4.5 m wide or on more than one such street.
Class B Site
:
A corner site that abuts on 2 streets either of which is less than 4.5 m wide.
Class C Site
:
A corner site that abuts on 3 streets none of which is less than 4.5 m wide.
DOMESTIC BUILDINGS
Height of Building in metres
Percentage site coverage
Item
Class of site
Open space required
1.
Class A site
Not less than one-half of the roofed-over area of the building
2.
Class B site
Not less than one-third of the roofed-over area of the building
3.
Class C site
Not less than one-quarter of the roofed-over area of the building
NON-DOMESTIC BUILDINGS
Percentage site coverage
Plot Ratio
Class Class Class Class Class Class C B A C B A site site site site site site
Plot Ratio
Class A site
Class B site
Class C site
Class A site
Class B site
Class C site
Not over 15 m
66.6
75
80
3.3
3.75
4.0
100
100
100
5
5
5
15 m to 18 m
60
67
72
3.6
4.0
4.3
97.5
97.5
97.5
5.8
5.8
5.8
18 m to 21 m
56
62
67
3.9
4.3
4.7
95
95
95
6.7
6.7
6.7
21 m to 24 m
52
58
63
4.2
4.6
5.0
92
92
92
7.2
7.4
7.4
24 m to 27 m
49
55
59
4.4
4.9
5.3
89
90
90
8.0
8.1
8.1
27 m to 30 m
46
52
55
4.6
5.2
5.5
85
87
88
8.5
8.7
8.8
30 m to 36 m
42
47.5
50
5.0
5.7
6.0
80
82.5
85
9.5
9.9
10.2
36 m to 43 m
39
44
47
5.4
6.1
6.5
75
77.5
80
10.5
10.8
11.2
43 m to 49 m
37
41
44
5.9
6.5
7.0
69
72.5
75
11.0
11.6
12.0
49 m to 55 m
35
39
42
6.3
7.0
7.5
64
67.5
70
11.5
12.1
12.6
55 m to 61 m
34
38
41
6.8
7.6
8.0
60
62.5
65
12.2
12.5
13.0
33.33
37.5
40
8.0
9.0
10.0
60
62.5
65
15
15
15
Over 61 m Source:
Buildings Ordinance, Hong Kong, SAR Refer to www.legislation.gov.hk for further information.
CONSTRUCTION COST SPECIFICATION FOR HONG KONG The costs for the respective categories given on the previous pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, balconies, plant rooms, water tanks and the like. All buildings are assumed to have no basement (unless otherwise stated) and to be built on flat ground, with normal soil conditions. The costs exclude external works, land costs, professional fees, finance and legal expenses. The standards for each category of buildings vary from country to country. Standards representing by the construction costs of other regions published hereinafter do not necessarily follow those of Hong Kong. DOMESTIC Public rental housing is based on Hong Kong Housing Authority Non-standard Cruciform Block design. Private housing estates are based on blocks containing 30-50 storeys, with average unit size not greater than 100 m2. Single glazed windows. Tiled or plastered finishes in general. Air conditioning, kitchen cabinets and home appliances are included for private housing estates, private luxury apartments, terraced houses and prestige houses. All types of domestic construction include provision of functional light fittings only and no feature light fittings have been allowed. Fitting out works and loose furniture are also not included. OFFICE/COMMERCIAL Office based on buildings 20-30 storeys high with floor plans minimum 1,000 m2 per level.I Average standard offices and shopping centres exclude finishes, A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations and granite finishes lobbies, with raised floor, suspended ceiling, A/C ducting and light fittings to tenants areas. INDUSTRIAL Flatted factories exclude manufacturing equipment, airconditioning, electrical distribution systems and special services provisions to tenants areas.
HOTELS F.F. & E. includes interior decoration and loose furniture etc. but excludes pre-opening expenses and hotel operation system and equipment costs (e.g. cutlery, crockery, linen, uniform, etc.). Includes 1 level of basement. OTHERS Carparks to be multi-storey. Primary and secondary schools with standard government provisions. International Schools with upgraded facilities. Student hostels to university standard. Sports club to the standard of the Government's indoor recreational centre.
FIT-OUT COSTS FOR HONG KONG BUILDING TYPE
HK$/m 2
BUILDING TYPE
HOTELS
DEPARTMENT STORES
Public Areas (Front of House) :
General department store
3-star Hotel
7,600 - 11,500
4-star Hotel
12,000 - 16,000
5-star Hotel
17,000
up
Guest Rooms : 3-star Hotel
6,000 - 7,400
4-star Hotel
7,500 - 10,000
5-star Hotel
10,000
up
Notes : 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, building shell, chandeliers, operational items and equipment (e.g. cutlery, crockery, linen, television, refrigerator etc.)., openinig expenses, stage equipment and computer systems.
10,000
up
Notes : 1. Includes electrical work, additional FCU and minor alteration of fire services to suit layout. 2. Excludes facade modification, data cabling, operational items and equipment (e.g. computers, P.O.S, office equipment) and opening expenses.
General dining restaurant Fine dining restaurant
General office
4,800 - 7,400
Executive office
7,500 - 10,500
Notes : 1. Local/Taiwanese/PRC furniture allowed for general offices 2. Includes furniture, partitioning, electrical work, minor alteration to air-conditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, data cabling, office equipment (e.g. computers, photocopiers, fax machines, UPS, etc).
6,000 - 9,300
RESTAURANTS
OFFICES
Prestige office
Prestige department store
HK$/m 2
10,500
up
Notes : 1. Includes furniture, floor, wall and ceiling finishes, electrical work, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen 2. Excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.).
7,600 - 15,000 16,000
up
UNIT COSTS FOR ANCILLARY FACILITIES FOR HONG KONG DESCRIPTION
UNIT
HK$
DESCRIPTION
UNIT
SQUASH COURTS
SAUNAS
Single court with glass backwall including associated mechanical and electrical services but excluding any public facilities (enclosing structure not included). per court
Sauna room for 4-6 people complete with all accessories (enclosing structure not included). per room
HK$
130,000
420,000 STEAM BATHS
Steam bath for 4-6 people complete with all accessories (enclosing structure not included). per room
TENNIS COURTS
Single court on grade with acrylic surfacing and complete with chain link fence. per court
870,000 GOLF COURSES
Single court on grade with artificial turf surfacing and complete with chain link fence. per court
980,000
Extra for lighting.
300,000
per court
(Based on average cost of an 18-hole golf course) Excluding associated buildings and equipment. per hole
SWIMMING POOLS
Half Olympic (25m x 10.50m) outdoor swimming pool built into ground, fully tiled; complete with 5m wide deck and associated pool equipment and ozone system. per pool
per set
7,000,000 to 13,000,000
GOLF SIMULATOR
5,500,000
PLAYGROUND EQUIPMENT
Outdoor playground equipment comprising various activities.
130,000
250,000 to 650,000
Golf simulation system complete with projector, high impact projection screen, artificial turf, recording system and control computer with software (enclosing structure not included).
per set
550,000
2012 OUTLOOK China: Riding on the wave of recovery from 2010 and despite continued volatility in the global economy, the quarters of 2011, but was clouded by growing uncertainty in the property market towards the end of the year. The volume of construction works performed in 2011 grew at about 25% per annum, close to the rate in each of the preceding two years. However, the rate of growth for new-start floor areas in the real estate sector has slowed down slightly. This is likely because, on the one hand, the build-up of demand prior to the 2010 economic rebound has been released, whilst at the same time, the central government has taken decisive action to curb soaring residential property prices. The Government has adopted a series of measures to reduce speculative activities by property developers and end-users alike – including purchase limits, credit restrictions, a premium on the benchmark mortgage rate and higher down payments. Given the fact the Government has stated its long term goal is to keep property prices stable, these measures will likely be in place for some time. The credit crisis in the US coupled with the sovereign debt problems in the Eurozone has weakened the global economy, resulting in a slow-down of fixed asset investment activities across China. Given these conditions, private sector activity is likely to stablilise and we are unlikely to see another 2010-style boom anytime soon. A positive note is that the Government does not intend to cut the supply of residential property. In fact, it has committed to provide 36 million affordable public housing units in the coming five years. Of this, 10 million are to start each year in 2011 and 2012. When compared to the number of residential units started by the public and private sectors in 2010 (circa 5.8 million and 13 million respectively), this new initiative accounts for about half of the total floor area of all building works. On the face of it, this potential volume of new public works should be able to outweigh the possible slowdown in the private sector. However, the distribution of these 10 million units to various regions may not be in direct proportion to the scale of construction capacity in each region. For example, Chongqing’s construction output in 2010 was only 2.6% of the whole country, but their allocation of affordable public housing units for 2011 represents 5% of the country’s annual target (i.e. 500,000). On the other hand, Beijing and Shanghai performed 5.5% and 4.5% of the national total output in 2010, but are assigned only 200,000 and 260,000 units respectively. This apparent divergence may be partly explained by the fact that Beijing and Shanghai have relatively more commercial and infrastructure construction. However, it remains to be seen if this policy results in more localised variances in construction costs across the country. Within the industry, both material prices and labour wages continur to be influenced by inflation in living and and production costs. Both the Consumer Price Index and Producer Price Index had at one stage surged to 3-year highs, before dipping to 1-year and 2-year lows respectively in November, albeit still in positive territory. Workers’ pay rises are also bound by the nationwide increment in the Statutory Minimum Wage, which is about 20% on
average. However, this has been offset to some extent by material costs having dipped in the 4th quarter. As a whole, construction costs have risen about 5% in 2011. On the back of the Government’s proactive housing policy, the outlook for the industry remains fairly positive. Driven by increases in labour costs and general inflation, overall construction costs are forecast to rise by 5% p.a. in both 2012 and 2013. Hong Kong: Construction activity picked up in 2011, driven by implementation of the public infrastructure projects and a gradual recovery in the private residential sector following the 2008 crisis. With this improved sentiment, private residential have pressed ahead with new projects. Despite the HKSAR Government’s tightening measures (eg. extra stamp duty for properties sold within 2 years’ of purchase, increased down payments for units over HK$8M) and the banks’ increased mortgage rates, residential construction starts during the first nine months of 2011 still managed to reach 7,700 units. This surpassed the average 6,600 units which started each year from 2008 to 2010. These figures are likely to grow further over the next few years as a result of the Chief Executive’s commitment in the 2010/11 Policy Address to supply land for 20,000 private residential units a year, for the next decade. Plots of land released by the government for residential use in 2011 could potentially provide up to 12,000 private units. Of which, 6,700 will be built on top of, or adjacent to, existing MTR station boxes, where most of the foundation works have already been completed – thus allowing an early start on the superstructure construction. Given that the new-build private residential sector contributes about 20% of the annual gross output of the construction industry, it will not be long before this supply translates into increased construction volume. The likely follow-on effect will be pressure on tender prices. Basic construction costs have risen by around 8% in 2011, largely as a result of escalation in material prices and labour wages driven by the SAR’s 15-year-high inflation rate, the weakening of the US dollar against the Renminbi, and growing demand for labour. Overall, the outlook for the industry in 2012 is fairly upbeat, although continued uncertainty in the US and EU economies will need to be kept in view. We forecast construction costs will rise by 8% a year in both 2012 and 2013. Macau: Construction activity is expected to gather pace in 2012. One of the bigger projects is the long-awaited construction of the Macau Light Rail Transit (LRT) system, which is scheduled to last for about four years. In addition, the Macau government has been busy commissioning new public housing and other infrastructure works in response to growing economic activity and demand from the public. In the entertainment and gaming sector, a number of Cotai projects, such as Venetian Parcel 3, Macau Studio City, Wynn and the next phase of Galaxy Macau are scheduled to start in the latter part of 2012. Given the relatively modest levels of casino construction in the last two years, such increased demand is likely to put significant pressure on construction labour and material prices
for 2012 and beyond. Across the boundary with Guangdong, the progress of projects on the neighbouring Hengqin Island is expected to pick up in the next few years, especially from private sector investment. Given its proximity to Macau, it is likely that the work there will have an effect on Macau's construction prices. According to the Statistics and Census Service of the Macau Government, as at third quarter 2011, the average daily wages of construction workers was MOP569, representing a 4.6% year-onyear increase. Similarly, the price index of construction materials rose by 20.4% year-on-year. Given the above situation, we predict tender prices are set to increase by about 8% during 2012.
CONSTRUCTION COST TREND PREDICTION REGION
2011
2012
2013
China (1)
+5%
+5%
+5%
Hong Kong (1)
+8%
+8%
+8%
Hong Kong (2
+8%
+8%
+6%
Macau (1)
+7%
+8%
+8%
(1) Building Works (2) Civil Engineering Works
PROPERTY COMMENTARY HONG KONG'S PROPERTY MARKET IN 2011 Economic overview Hong Kong’s economic growth remained stable in 2011 although the global economy outlook remained unclear amid the outbreak of the European sovereign debt crisis. Hong Kong’s GDP growth in real terms surged 4.3% in the third quarter, following a gain of 5.1% in tthe first half of 2011. Visitor arrivals recorded a notable year on year growth of 16.2% in the first nine months of 2011, mainly driven by the growth in visitors from Mainland China. The value of retail sales also exhibited strong year-on-year growth of 25.4 % in the period. Meanwhile, the unemployment rate dropped to 3.3% in the three months to October, compared with 4.2% in the same period of 2010. Looking forward, the global economy is expected to become more recessionary in the coming year and the effect will inevitably spill over to Hong Kong. As employers may become cautious about hiring because of the unclear economic outlook, the unemployment rate in Hong Kong may rise slightly in 2012. The Hong Kong government has lowered the city’s GDP growth forecast for 2012 from 5–6% to 5%. Residential Hong Kong's residential market slowed in 2011 by a series of regulatory government policies, such as the implementation of Special Stamp Duty, and credit tightening measures adopted by local and Mainland banks. The number of residential sales transactionstotaled about 75,300 in the first ten months of the year down 33.5% from the same period in 2010. The luxury residential market was more resilient, with transactions worth HK$10 million or above dropping a less drastic 14.3% during the same period. Residential prices experienced minor downward adjustments in the third quarter, following an upward trend in the first half of the year. However, the average price of luxury homes by the end of September 2011 was still 62.4% higher than the level in November 2008, according to Rating and Valuation Department, when the market was dragged down to its trough by the global financial crisis. Mass residential prices performed even better and soared 75.7% in September 2011 compared with their trough in December 2008. In the leasing market, the average rent of luxury residential properties, by the end of September, had risen 42.2% from its trough in April 2009. Looking forward, uncertainties in the global economy are expected to keep the volume of residential sales transactions low in 2012. Mass home prices are likely to drop about 10-15% in 2012. Luxury residential properties should be more resilient due to their limited supply, with their prices set to adjust marginally by less than 10% in 2012.
Office The Grade-A office sales market continue to grow over the year, despite the introduction of lower loan-to-value ratios by the government. The average capital value of Grade-A offices rose 20.8% during the first ten months, compared with only 16.9% over 2010. The number of office sales transactions totaled 2,675 in the first nine months of 2011, up 4.3% from the same period of 2010, according to the Rating and Valuation Department. In the leasing market, financial institutions and professional services firms scrambled for limited office space in core areas. The average Grade-A vacancy rate edged down from 3.2% in December 2010 to 2.5% in October 2011. Aggressive corporate expansions and decreasing vacancies prompted landlords to raise their asking rents markedly, leading to a boost in office rents. By the end of November, the average rent of Grade-A offices witnesses a 21.3% year-to-date growth. Looking forward, office demand from financial institutions - that usually favour space in core districts - is likely to slow amid the eurozone debt crisis. Meanwhile, local firms are also expected to slow their expansion plans. Grade-A office rents in cire areas will see mild corrections, while rents in non-core districts will remain stable with the support of companies moving out from core areas to these locations to save operation costs. Retail Hong Kong’s retail property market experienced strong growth in 2011 on the back of robust retail sales and increased tourist arrivals, especially those from Mainland China. Amid relatively weak economies in US and Europe, international brands expanded aggressively in Hong Kong in order to grab a share of strong spending from Mainland tourists. Competition for leasing shops in prime locations was fierce, especially among international luxury fashion brands and jewellery shops, pushing up rents of prime street shops by 20.7% year on year in the first three quarter of 2011. In the sales sector, although retail property sales transactions dropped 8.5% year on year to 5,169 in the first nine mohts of 2011, their total value grew by 1.1%. In view of the cooling measures implemented on the residential sector, some investors turned to acquire quality retail properties for long term growth, pushing up prime street shop prices by 18.9% in the first three quarters of the year. In the coming year, with sustainable retail sales growth and the continued influx of Mainland tourists, we expect international retailers will continue to expand in Hong Kong, which would push up retail rents by another 10% over 2012.
Industrial Hong Kong’s industrial property market continued to recover over 2011, in the aftermath of the global financial tsunami. The government’s new policies to encourage the change of use of industrial buildings implemented in April 2010, plus the rezoning of industrial areas proposed in October 2010, helped revitalise the industrial sales market. There were 6,617 flatted-factory sales transactions during the first nine months of 2011, up 15.4% fromt he same period in 2010, with total consideration rising 45.1% to over HK$24.0 billion. The value of en-bloc industrial property sales reached about HK$4.6 billion up to mid-November 2011, up 7.2% from the same period of 2010, according to our research. During the first nine months of 2011, prices of flatted factories grew 23.1%, while their rents increased 11.4%, according to the Rating and Valuation Department. With prices rising faster than rents, yields slid to 3.9% in September 2011, compared with 4.6% a year ago. By the end of September, the Lands Department had approved 35 applications of change of usage under the revitalisation scheme, involving the demolition and redevelopment of nine industrial buildings as well as the wholesale conversion of 26 others, providing a total gross floor area of 380,000 sq m for non-industrial uses. We expect the acquisition of industrial buildings for redevelopment and conversion to continue in the coming year, which would further push up industrial property prices, while their rents would remain stable.
Provided by :
PROPERTY INDICATORS HONG KONG GRADE-A OFFICE PRICE
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE VACANCY RATES
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE RENTAL VALUES
* Oct figure Source: Knight Frank
HONG KONG GRADE-A OFFICE SUPPLY
Source: Rating and Valuation Department / Knight Frank
GROSS FLOOR AREA (GFA) CALCULATIONS IN HONG KONG FEATURE
REMARKS
General floor area
Accountable
Basement
Accountable
Balcony / utility platform *
Accountable
Non-accountable if for residential buildings and be open on at least 2 sides, max. 50% area grantable.
Curtain wall / cladding
Non-accountable
Non- accountable if: 1. The curtain wall system itself does not form part of the structural system of the parent building; 2. The system does not result in any additional floor area at a floor level; 3. The projection of the system from the outer face of the structural elements does not exceed 300 mm.
External wall finishes (including bay windows) *
Non-accountable
Precast facades may subject to conditions be excluded from GFA calculation.
Plant rooms
Non-accountable
Subject to justification with reasonable plant layouts.
Staircases and lift shafts
Accountable
Covered public carparking space
Accountable
Covered private carparking space
Non-accountable
Area within outer surface of external walls.
Except staircases and lift shafts solely serving non-accountable areas. Applicable only for spaces serving users of the building required under local standard and built below ground.
Lobby *
Accountable
Concession may be granted for lift lobbies subject to conditions.
Canopy
Accountable
Non-accountable when the canopy soley serves as protection against weather and falling object.
Refuge floor
Non-accountable
Space below elevated ground floor
Accountable
Covered walkways *
Accountable
Loading and unloading bay
Non-accountable
Refuse storage chambers, refuse storage, refuse chutes, refuse hopper rooms
Non-accountable
Floor space inside sloping roof Covered area on roof-tops
*
BUILDING (PLANNING) REGULATION
Non-accountable if the covered areas are clearly intended for and designed as playground or dedicated as public passage. Open-sided covered walkways for common areas in residential developments may be exempted, subject to the proposed walkways being not for commercial use. Applicable if required under local standard/lease and built below ground.
Accountable Non-accountable
Non-accountable for plant rooms and staircases only.
Recreational facilities *
Accountable
Non-accountable subject to conditions.
Spaces for watchmen and management staff *
Accountable
Non-accountable subject to conditions.
External staircases
Accountable
Non-accountable if situated in non-accountable areas.
Total concessions of these areas are subject to a cap of 10% of the total GFA and prerequisites with sustainability designs.
Disclaimer : GFA calculations are subject to various legislation and practice notes. All cases of accountable or non-accountable GFA are subject to individual conditions. The above presents a brief summary only and users are advised to seek professional advice from authorized persons. Langdon & Seah herewith disclaims any liability that may arise from unsolicited use of the information given above.
GROSS FLOOR AREA (GFA) CALCULATIONS IN PRC FEATURE
NATIONAL STANDARD - STANDARD MEASUREMENT FOR CONSTRUCTION AREA OF BUILDING (GB/T 50353-2005)
General floor area
Accountable
Basement
Accountable
Balcony / utility platform
Accountable
Curtain wall / cladding
Accountable
External wall finishes (including bay windows)
REMARKS FOR BEIJING, SHANGHAI AND GUANGZHOU Area within outer surface of external insulation. Shanghai : External insulation is exempted from calculation of plot ratio. 1. Beijing: Non-accountable 2. Shanghai : Non-accountable. 3. Guangzhou : Accountable for GFA except where the floor space is solely for plant rooms or carpark Except decorative type of curtain wall.
Non-accountable
Plant rooms
Accountable
Staircases and lift shafts
Accountable
Covered public carparking space
Accountable
Covered private carparking space
Accountable
Lobby
Accountable
Canopy
Accountable
Refuge floor
Accountable
Space below elevated ground floor
Accountable
Covered walkways
Accountable
Loading and unloading bay
Accountable
Non-accountable if not roofed over.
Refuse storage chambers, refuse storage, refuse chutes, refuse hopper rooms
Accountable
Non-accountable if not roofed over.
Floor space inside sloping roof
Accountable
Non-accountable if clear height does not exceed 1.2m.
Covered area on roof-tops
Accountable
1. Shanghai : Non-accountable if the area of the construction on rooftop does not exceed 1/8 of the area of the typical floor. 2. Guangzhou: Staircase, lift lobby and water tank room on roof-tops are exempted from GFA
Recreational facilities
Accountable
Spaces for watchmen and management staff
Accountable
External staircases
Accountable
Non-accountable subject to width of the canopy not exceeding 2.1m. 1. Shanghai : Non-accountable. 2. Guangzhou : Only refuge areas on refuge floow are non-accountable. Non-accountable for GFA if for the usage of walkway, green, public amenities or similar public function.
Non-accountable if not roofed over.
Disclaimer : GFA calculations are subject to various legislation and practice notes. All cases of accountable or non-accountable GFA are subject to individual conditions. The above presents a brief summary only and users are advised to seek professional advice from authorized persons. Langdon & Seah herewith disclaims any liability that may arise from unsolicited use of the information given above.
COMPOSITE CPI
YEAR
INDEX
% CHANGE
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011*
90.2 95.9 101.5 104.3 100.2 96.5 94.9 92.0 89.7 89.3 90.1 92.0 93.8 97.8 98.4 100.7 105.5
9.2% 6.3% 5.8% 2.9% -3.9% -3.7% -1.6% -3.1% -2.6% -0.4% 1.0% 2.0% 2.0% 4.3% 0.5% 2.4% 5.2%
* 01/11 to 10/11 only Note: The base index (100) applies to the period from October 2009 to September 2010. Source
: Census and Statistics Department, Hong Kong, SAR Refer to www.censtatd.gov.hk for further information.
EXCHANGE RATES Approximate rates prevailing on 30 November 2011. COUNTRY
CURRENCY
HK$1
US$1
Australia
Dollar
0.13
1.00
Brunei
Dollar
0.17
1.30
Canada
Dollar
0.13
1.03
Renminbi
0.82
6.39
EU (Euro Zone)
Euro
0.10
0.75
Hong Kong
Dollar
1.00
7.79
India
Rupee
6.70
52.18
Indonesia
Rupiah
1,177.26
9,170.00
Yen
10.01
77.93
Kazakhstan
Tenge
19.05
148.39
Macau
Pataca
1.03
7.99
Malaysia
Ringgit
0.41
3.19
New Zealand
Dollar
0.17
1.31
Pakistan
Rupee
11.23
87.47
Philippines
Peso
5.61
43.74
Qatar
Rial
0.47
3.64
Singapore
Dollar
0.17
1.30
South Korea
Won
146.63
1,142.14
Taiwan
NT Dollar
3.89
30.27
Thailand
Baht
4.02
31.32
United Kingdom
Pound
0.08
0.64
United States of America
Dollar
0.13
1.00
Vietnam
Dong
2,709.29
21,103.31
China
Japan
Source : www.exchange-rates.org Refer also : www.xe.com
CURRENCY CHARTS STERLING POUND
AUSTRALIAN DOLLAR
JAPANESE YEN
RENMINBI
Source
: Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information
Source
: Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information
Refer also
: www.xe.com ; www.exchange-rates.org
Refer also
: www.xe.com ; www.exchange-rates.org
HONG KONG PRIME RATE
CHANGES IN HONG KONG PRIME RATES DATE
14 Feb 2000 27 Mar 2000 22 May 2000 08 Jan 2001 05 Feb 2001 26 Mar 2001 23 Apr 2001 21 May 2001 03 Jul 2001 24 Aug 2001 19 Sep 2001 04 Oct 2001 08 Nov 2001 13 Dec 2001 08 Nov 2002 23 Sep 2004 12 Nov 2004 21 Mar 2005
%
8.75 9.00 9.50 9.00 8.50 8.00 7.50 7.00 6.75 6.50 6.00 5.50 5.25 5.125 5.00 5.125 5.00 5.25
DATE
%
23 May 2005 05 Jul 2005 22 Jul 2005 11 Aug 2005 23 Sep 2005 03 Nov 2005 15 Dec 2005 30 Mar 2006 07 Nov 2006 20 Sep 2007 02 Nov 2007 12 Nov 2007 13 Dec 2007 24 Jan 2008 01 Feb 2008 20 Mar 2008 10 Nov 2008
5.75 6.25 6.50 6.75 7.00 7.50 7.75 8.00 7.75 7.50 7.25 7.00 6.75 6.00 5.75 5.25 5.00
Source : Hong Kong Monetary Authority Refer to www.info.gov.hk/hkma for further information.
HANG SENG INDEX
Refer to www.aastocks.com for further information.
TELEPHONE DIRECTORY HONG KONG GOVERNMENT Architectural Services Department Headquarters Administration Division 2867 3628 Architectural Branch Advisory & Statutory Compliance Division 2867 3759 Architectural Drawing Records Unit 2867 3691 Division 1 2867 3935 Division 2 2867 3814 Site Staff (New Works) 2867 3992 Technical Officer (Architectural) Grade Management Unit 2867 3691 Building Services Branch Division 1 2867 3538 Division 2 2867 3493 Division 3 2867 3629 Division 4 2867 4156 Property Services Branch 2773 2217 Quantity Surveying Branch 2867 3298/2867 4597 Structural Engineering Branch 2867 3791 Buildings Department 2626 1616 Census and Statistics Department 2582 4807 Civil Engineering and Development Department 2762 5111 Customs and Excise Department 2815 7711 Drainage Services Department 2877 0660 Electrical and Mechanical Services Department 1823 Environmental Protection Department 2594 6308 Fire Services Department 2311 0066 Government Laboratory 2762 3700 Government Property Agency 2594 7604 Highways Department 2926 4111 Housing Department 2712 2712 Labour Department 2717 1771 Lands Department 2231 3294 Planning Department 2231 5000 Rating and Valuation Department 2152 0111 Water Supplies Department 2824 5000 Refer to http://tel.directory.gov.hk for further information.
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, Malaysia, Philippines, Vietnam and Singapore and is also the editor of the Spon’s Price Book Series. As in the previous editions, the DLS Handbook – India 2012 focuses on the construction cost profile of India and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in India. The information contained in this handbook has been compiled by Davis Langdon & Seah Consulting India Pvt Ltd. Any further information and/or if advice relating to particular projects is required, please contact us at the address given at the end of this handbook.
INDIAN CONSTRUCTION - AN OVERVIEW Construction in India has historical significance and finds remarkable place in Indian history. World wonders such as the Taj Mahal and ancient temples are classic examples of construction achievements in ancient times. During the period of British rule and post Independence India, the construction industry was dominated by the government and this domination continued up to the mid 1990s. The subsequent change in foreign investment policies accelerated industrialization, foreign investment and subsequent demand for buildings and infrastructure. Indian Construction Industry today is the second largest economic activity in the country, followed by agriculture. Construction with linkage to other industries hasgenerated employment for more than 40 million people in the country. The cost structure of the construction industry is principally dominated by raw material costs and sub-contracting costs. Raw material cost which is the major cost component, accounts approximately 30% to 50% of the total cost and subcontracting cost accounts approximately 20% to 40%. The consumption of steeland cement by the construction industry has also shown an increase of 16% and 10% respectively between 2002 and 2007. Prior to the global economic crisis, India has experienced an unprecedented rise in the price of these two raw materials resulting in a significant increase in the construction cost trend. However, prices of these two materials have reduced considerably in 2009 by up to 20% and 25% respectively, resulting in a downward trend in construction cost. Prices of these two materials started to increase in early 2010 and current material price remains volatile. The Construction Industry is dependent on investments in the infrastructure, industrial and real estate sectors. The Planning Commission has envisaged an outlay of approximately US$ 300 billion during the 11th Five Year Plan for infrastructure development in the country. These investments would be achieved through a combination of Public and Public-Private Partnerships. 11th Five Year Plan (2007-2012). The estimate of additional investment for the 11th Five Year Plan period is given below. ITEM
AMOUNT RS CRORES
Private Investments in Road
34,000
Expressway Development (Modernization/Upgradation)
220,000
Railways (Public)
180,000
Railways (Private)
120,000
Civil Aviation
40,000
Ports (Private)
50,000
Freight Corridors for Railways Power Generation Housing
22,000 420,000 150,000
INFRASTRUCTURE DEVELOPMENT 1. Roads India has 3.3 million kilometers of road out of which 70,000 kilometers comprises national highways. The road network carries approximately 85% of the total passenger traffic and 70% total freight traffic. The National Highway Authority of India (NHAI) is currently implementing an US$ 12 billion national highway development projects. Some of the major developments planned by NHAI are: • Six-laning of the Golden Quadrilateral - 5,846 kms connecting Delhi-Kolkata-Chennai-Mumbai and; • Four-laning North-South and East-West Corridors 7,300 kms connecting Kashmir to Kanyakumari including Salem to Cochin Spur and Silchar to Porbandar; spanning the length and breadth of the country. 2. Railways The Indian Railway system is the World’s fourth largest rails network and the largest in Asia. It comprises of over 100,000 track kilometers and runs about 11,000 trains everyday carrying an estimated 18 million passengers and 2 million tonnes of freights. A large proportion of the capital investment is proposed to be raised through Public-Private Partnerships. Indian Railways is expected to invest US$ 45.9 billion in the 11th Five Year Plan, triple the amount envisaged in the 10th Plan. 3. Ports Considerable private investment has started flowing into the Indian port sector. A number of existing facilities have been taken over by private players and many new facilities have also been set up at existing ports. Two new ports (Mundra and Pipavav in Gujarat) have also been constructed by the private sector. India currently has 12 major ports and 200 minor/intermediate ports spread across the vast coastline of 7,517 kms. They handle almost 90% of India’s total foreign trade. The current handling capacity of the ports in the country is around 600 million tonnes. This has been achieved through construction of a new port at Ennore and a mechanized coal handling facility at Paradip. Thesetwo facilities entailed an investment of around US$ 394 million. According to government estimates, private sectorinvestment in ports may exceed US$ 18 billion within a decade. The Government of India targets to increase cargo handling capacity of major ports by two folds to reach 1.5 billion metric tonnes (MT) by the year 2012.
BASIC COST OF KEY MATERIALS UNIT
RATE* [Rs]
Reinforcement Steel
MT
42,000
Ordinary Portland Cement
Bag
285
20mm Aggregate
m3
850
Sand
m3
1,200
Shuttering Plywood
m2
625
200mm Solid Concrete Block (400mm x 200mm x 200mm)
No
36
100mm Solid Concrete Block (400mm x 200mm x 100mm)
No
25
200mm Hollow Concrete Block (400mm x 200mm x 200mm)
No
35
100mm Hollow Concrete Block (400mm x 200mm x 100mm)
No
25
Teak Wood
m3
110,000
Sal Wood
m3
33,000
Vitrified Tiles
m2
500
Ceramic Tiles
m2
400
Emulsion Paint
Ltr
200
MATERIAL
* Material rates are nett of VAT
The prices of cement and reinforcement steel are highly volatile and fluctuate very frequently. The charts below provide the price variation of these two materials for the last six months:
Cement Price Fluctuation Rs. / 50kg bag
Description
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
275
285
280
280
275
295
Cement (Grade 53)
Cement Price Fluctuation 300
Rs. / 50kg bag
295 290 285
Cement (Grade 53)
280 275 270 Jun-11
Jul-11
Aug-11 Sep-11
Oct-11
Nov-11
Months
Reinforcement Price Fluctuation Rs. / MT
Description Reinforcement Steel
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
41,500
41,350
44,385
41,600
42,689
41,500
Reinforcement Steel Price Fluctuation 45,000 44,500
Rs. / MT
44,000 43,500 43,000
Reinforcement Steel
42,500 42,000 41,500 41,000 40,500 Jun-11
Jul-11
Aug-11 Sep-11 Months
Oct-11
Nov-11
WAGES OF KEY PERSONNEL PERSONNEL
RATE/DAY [Rs]
Skilled Mason
400
Semi-Skilled Mason
300
Tiling Mason
450
Bar Bender
375
Carpenter
425
Painter
400
Welder
400
Electrician
400
Plumber
400
Unskilled Labour
250
4. Airports India has 126 airports: of these 12 are designated as international airports. The top 5 airports in the countryhandle 70% of the passenger traffic. The Government has embarked on a number ofupgrading and new airport development projects which have been made available for FDI. Key factors driving airport development are listed below: • Passenger traffic is projected to grow at a Compound Annual Growth Rate (CAGR) of over 15% in the next 5 years. Expecting 100 million passengers per annum (p.a) over the next 5 years • Cargo traffic to grow at approximately 20% p.a. over the next five years • Favourable demographics and rapid economic growth point to a continued boom in domestic passenger traffic and international outbound traffic • Indian private airline accounts for around 60% of the domestic passenger traffic • Estimated investment of about Rs.40,000 Crores (US$ 9 billion) for airport development over the next 5 years • 100% FDI is permissible in existing airports; FDI beyond 74% requires FIPB approval • 100% tax exemption for airport projects for a period of 10 years 5. Power India presently has a huge shortfall in power generating requirements to support the economic and population growth. Some key features are as follows: • Transmission and Distribution Network of 5.7 million circuit km – the 3rd largest in the world • 57% of the installed generation capacity comes from coal-fired plants, followed by 25% from hydro power, 10% gas-based, 3% from nuclear energy and 5% from renewable sources • 100% FDI is permitted in Generation, Transmission and Distribution • Total investment opportunity of about US$ 200 billion over a seven year horizon
Investment in Different Sectors Scope of Investment Required in Different Sectors (5 to 7 Years) 80 70
50 40 30 20 10 0 R o R ad ai lw ay s Ai rp or t Po rt Po w W er at er In fr Te a. le Fo od com Pr oc es s
US$ Billion
60
Sectors
US$ Billion
PROCUREMENT MODEL AND CONTRACT FORMS In both public and private sectors, most of the construction projects are procured based on competitive tendering. The following are the commonly adopted procurement routes in India: 1. Conventional Contract based on Bills of Quantities/ Sum 2. Design and Build Contract 3. Construction Management Contract 4. Management Contract Commonly used contract forms are: • FIDIC suite of Contracts (EPC/Turnkey/Short Form) • Indian Institute of Architects Forms • Central Public Works Department Forms • Municipal Bodies Forms
Lump
CHALLENGES FACING REAL ESTATE AND CONSTRUCTION INDUSTRIES • Land Ownership and Title Issues • High Transaction Cost • Slow Approval Process • Liquidity Risk • Property Market Transparency Risk • Supply and Demand on Material and Labour • Shortage of Technical Supervisory/Skilled Labour
PREAMBLES The construction costs for the respective categories given on the following pages are average costing at 4th Quarter 2011. They are based on interpolation of competitive tenders received. The construction cost serves as a guide for preliminary cost appraisals and budgeting. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metres are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, plant rooms, water tanks and the like. All buildings are assumed to have no basements (unless otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs exclude the following: • Professional fees • Authorities’ processing and approval charges • Land cost • Financing charges • Administrative expenses • Legal costs and disbursements • Demolition of existing building/s • Loose furniture and fittings • Operating equipment • Cost escalation • Value Added Tax (VAT) and Service Tax
CONSTRUCTION COSTS FOR INDIA TYPES
COST Rs/m 2
US$/m 2
RESIDENTIAL Detached houses and bungalows
20,441
409
Terraced houses
15,007
300
Avg. std. apartments, high rise
17,336
347
Luxury apartments,
21,955
439
OFFICE/COMMERCIAL Avg. std. offices, high rise
20,295
406
Prestige offices, high rise
25,704
514
Shopping centres
23,512
470
INDUSTRIAL Light duty flatted factory factories
13,183
263
Heavy duty flatted factories and warehouses Single storey conventional factories
15,667
313
12,622
252
Owner operated factories, low rise
15,840
317
36,180
723
3-star budget hotels inclusive of F.F. & E.
40,888
817
5-star hotels inclusive of F.F. & E.
79,600
1,588
OTHERS Basement car parks (<3 levels)
12,712
254
Elevated car parks (<4 levels)
11,080
222
Primary and secondary schools
8,907
178
Student hostels
11,385
228
Sports clubs inclusive of F.F. & E.
30,255
605
HOTEL Resort hotels
The foregoing construction costs are based on Bangalore. Exchange Rate US$1 = Rs.50/-
M&E COSTS FOR INDIA ACMV Rs/m2
ELECTRICAL Rs/m2
1,140
1,460
900
1,100
1,200
1,450
Avg. std. offices, high rise
3,700
4,000
Prestige offices, high rise
4,050
4,475
Flatted factories
2,540
2,675
Warehouses
2,800
3,050
Resort hotels
2,310
2,520
3-Star budget hotels
4,050
4,400
5-Star luxury hotels
4,650
4,850
-
475
520
500
3,250
3,850
TYPES
RESIDENTIAL Detached houses Avg. std. apartments, high rise Luxury apartments, high rise OFFICE
INDUSTRIAL
HOTELS
OTHERS Elevated car parks Basement car parks Shopping centres
OFFICE M&E COST COMPONENTS Electrical 5%
4%
ACMV 20%
8%
4% 1%
8%
3%
1%
35%
10%
9%
13%
1%
12%
1%
10% 1%
11%
1%
12%
15%
LV mains & sub-mains distribution system Lightning protection system Luminaries Earthing system Final sub-circuit for lighting & power points External lighting Standby generator Telephone distribution system Sub-station, HV & LV switchgear MATV/SCV system Underfloor trunking system CCTV/Guard patrol system Power transformer Public address system Intercom/Card access system
Chilled water AHU/FCU and ductworks Electrical and automatic control works Chiller plant Mechanical ventilation fan system and ductworks Condenser water pumps and pipeworks Chilled water pumps and pipeworks Cooling towers Split units and ductworks
Fire Protection 3%
15%
Plumbing and Sanitary
3%
7%
11% 2%
13% 19% 42%
7%
27% 22% 10%
Sprinkler Hose reel Wet riser Dry riser Automatic fire alarm Fire extinguisher External fire hydrant
28%
6%
Water works Water pumps Cold water distribution piping Installation and connection of water piping to sanitary wares Aboveground drainage piping system Underground drainage piping system Installation and connection of waste water piping to sanitary wares
REAL ESTATE DEVELOPMENT The real estate development in India has grown considerably since 2003 and peaked in 2007. The sector development slowed down in 2008 as a result of the global economic turmoil and showed a drastic slowdown in the first half of 2009. Faced with reduction in demand, housing prices dropped drastically. The early 2010 showed a comeback in the property sector and the outlook for the sector currently looks promising; however the uncertainties in the global economy may affect the FDI investments in the real estate sector. Residential space constitutes of almost about 80% of the real estate developed in India. The IT/ITES sector and the organized retail industry would require an estimated space of 150 million sq ft and 200 million sq ft respectively pan-India in the next 3 years. Hospitality sector also shows similar increase in requirements. The key demand drivers in the various real estate segments are: • India’s emergence as an attractive off-shoring destination for software development • Availability of highly skilled manpower • High disposable income and increasing aspirations for quality residential space • Entry of global brands and professional players • Improvement in infrastructure • Real estate as an investment option • Relaxed government and legal processes
KEY DATA India is one of the oldest civilizations with a kaleidoscopic variety and rich cultural heritage. It has achievedmultifaceted socioeconomic progress since gaining independence in 1947. Covering a landmass of 3,287,590 Square Kilometers extending from theHimalayan heights to the tropical rain forests of the south. As the seventh largest and second most populous country in the world, India stands apart from the rest of Asia. Bordering with Afghanistan and Pakistan to the northwest, China, Bhutan and Nepal to the north, Myanmar to the east and Bangladesh to the east of West Bengal and Sri Lanka to the south, India is strategically located. India is a Sovereign Socialist Democratic Republic witha federal parliamentary system of government. TheConstitutional head of State is the President and head of Government is the Prime Minister. The federal republic is governed in accordance with the Constitution of India which came into force on 26th January 1950. The Federal Republic consists of twenty-eight states and seven union territories. The parliament is a bicamental legislature: the lower house, the Lok Sabha, has 545 members, 543 singlemember constituencies and 2 representatives of Anglo-Indians appointed by the President; and the upper house, the Rajya Sabha, is elected by the provincial legislatures. Government Country Name
: Republic of India
Head of State
: President
Government Type
: Federal Republic
Head of Government
: Prime Minister
Capital City
: New Delhi
Administrative Divisions : 28 States and 7 Union Territories Independence
: 15th August 1947
Legal System
: Based on Constitution of India
Official Language
: English/Hindi
National Language
: Hindi
Geography Geographic Coordinates : 2000N, 7700E Location
: Southern Asia
Total Area
: 32,87,590 SqKm
Land Area
: 29,73,190 SqKm
Water
: 3,14,400 SqKm
Land Use
: Arable land 48.83% Permanent crops 2.8% Others 48.37%
Irrigated Land
: 5,58,080 SqKm
Coastline
: 7,500 Km
Natural Resources
: Coal (world 4th largest), iron ore, manganese, mica, bauxite, titanium chromate, natural gas, diamonds, petroleum, limestone
Climate Type
: Tropical monsoon with four seasons; winter, summer, rainy south-western monsoon and north-east monsoon
People Total Population
: 1,210 million
Age Structure
: 0 - 14 years 32.3% 15 - 59 years 60.5% 60 & above 7.2%
Population Growth Rate : 1.548% Median Age
: Total 26.2 years Male 25.6 years Female 26.9 years
Life Expectancy
: Total 68.8 years Male 65.77 years Female 67.95 years
Urban Population Delhi
: 16.33 million
Mumbai
: 18.41 million
Kolkata
: 14.11 million
Chennai
: 8.69 million
Bangalore
: 8.49 million
Ethnic Group
: Hindus 80.5% Muslims 13.4% Christians 2.3% Sikhs 1.8% Buddhists 0.8% Jains 0.4% Others 0.7% and Unspecified 0.1%
Languages
: Hindi 41% Bengali 8.1% Telugu 7.2% Marathi 7% Tamil 5.9% Urdu 5% Gujarati 4.5% Others 21.3%
Literacy (Definition-
: Total population 64%
Age 15 and over
Male 75.3%
can read and write)
Female 53.7%
Population below poverty line
: 21%
Labour Force : Labour Force by Occupation
523.5 million : Agriculture 60% Industry 12% Services 28%
Unemployment Rate
: 6.8%
Economy Monetary Unit
: Indian Rupees (Rs)
Currency Code
: INR
Exchange Rate to British Pound
: 80.10 INR
USD
: 49.78 INR
Euro
: 68.82 INR
Inflation Rate
: 9.73%
Fiscal Year : 1 April – 31 March GDP (Purchasing Power : $ 4.057 trillion Parity) (2011 Est) GDP (Official Exchange : $ 1.54 trillion Rate) GDP Real Growth Rate
: 7.6%
GDP per Capita GDP Composition by Sector
: $ 3,580 : Agriculture 18.5% Industry 26.3% Services 60.5%
Trade Total Exports
: $ 251.1 billion
Major Export
: Engineering Goods, Textile goods,
Commodities
Chemicals, Gems & Jewellery,
Export Partners
Leather manufactures : US 10.17%, UAE 13.76%, China 7.81%
Total Imports Major Import Commodities
: $ 369.7 billion : Crude Oil, Chemicals, Fertilizer and Gems
Import Partners
: China 11.75%, US 5.42% UAE 8.85%, Singapore 1.93%
International Airports
: Delhi, Mumbai, Kolkata, Chennai, Bangalore, Trivandrum, Cochin, Hyderabad, Ahemadabad
Major Seaports
: Mumbai, Cochin, Vishakhapatnam, Chennai, Tuticorn, New Mangalore, Kandla
ECONOMY The Indian economy has been growing at an impressive rate of 6% per year which accelerated to around 8% during the last couple of years. The growth recorded at 7.6% in 3rd Quarter 2011 which was moderately lowerthan the 8% anticipated by the Government of India. Rising inflation has resulted in a lower growth rate for year 2010-2011 as compared to the 8.8% growth rate in the previous year. GDP at Factor Cost 1,600,000
1,400,000
1,200,000 Mining & Quarrying
GDP (Factor Cost)
1,000,000
Manufacturing Electricity, Gas & Water Supply
800,000
Construction Trade, Hotel, Transport & Communication
600,000
Financing, Insurance, Real Estate & Business Services
400,000
Community, Social & Personal Services Agriculture
200,000
0 2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
Years
Source: Reserve Bank of India
Following the liberalization policy in 1990, the Government of India opened up the market through economic reforms and by easing government controls on foreign trade and investment. The Indian economy is characterized by a large young workforce which makes it dynamic and expansive. It is very diverse, with a wide range of sectors: manufacturing, handicrafts, textiles and services sectors. Theadvancement of information technology and the abundance of young well educated populace versed in English, is transforming India into an importantdestination for all major international companies for software development and technical support services. India is a major exporter of highly-skilled software professional. India is also expected to make considerable progress in other areas such as pharmaceuticals, manufacturing, tourism, aviation, telecommunications and biotechnology. Challenges for Indian Economy • Controlling inflation • Equitable spreading of growth benefits • Completing investment projects which are essential for the long term development of the economy • Managing global financial
FOREIGN INVESTMENT POLICY The following are some of the highlights of the Foreign Direct Investment (FDI) Policy in the real estate sector: • 100% FDI is allowed in real estate developments of over 50,000 m2 • Capital must be brought into India within 6 months of incorporation of JV or subsidiary • Repatriation of original investment allowed after 3 years • Sale of undeveloped land is not permitted • Minimum area to be developed has been reduced from 100 to 25 acres for integrated township projects • Minimum capital investment of wholly owned subsidiaries and joint ventures stands at US$ 10 million and US$ 5 million respectively • 51% FDI is allowed in single brand retail outlets and cash-and-carry through automatic route
100% in
FDI Infrastructure Equity Limit: Real Estate (Townships) Roads Power Airports Mining Telecom Airlines Banks (Private) Insurance
100% 100% 100% 74% 74% 74% 74% 74% 26%
Special Economic Zones (SEZs) SEZs are specially delineated duty free enclaves for the purpose of trade, operations, duty and tariffs. A SEZ may be set-up in the public, private, or joint sector and/or by a state government. There are about 98 functional SEZs in the country including those converted from the Export Processing Zones. SEZs have been developed in various segments such as multi-product, IT/ITES, biotechnology, gems and jewellery and technology intensive areas. The policy allows 100% FDI in most manufacturing activities. Developments in SEZ qualify for approval through automatic routes subject to sectorial norms. Details of the type of activities permitted are available in the Foreign Trade Policy issued by the Department of Commerce. Proposals not covered under the automatic route require approval by the Foreign Investment Promotion Board (FIPB).
Facilities to SEZ Units • SEZ units may import or procure from the domestic sources, duty free, all their requirements of capital goods, raw materials, consumables, office equipment, etc., for setting up of units or further operations without any license or specific approval • Goods imported/procured locally duty free could be utilized over the approval period of five years • 100% income tax exemption for the first five years and 50% for the two years thereafter • 100% FDI is allowed in the manufacturing sector in SEZ units under the automatic route except sectors requiring an industrial license. 100% FDI is allowed in items reserved for small scale units • Setting up of offshore banking units is allowed in SEZs. They would be entitled for 100% income tax exemption for three years and 50% for the next two years • More flexible exchange control regulations for units in SEZs and for external commercial borrowing up to US$ 500 million in a year • Exemption from service tax to SEZ units
Breakdown of SEZ by Sector 22%
4%
3%
62%
4% 5% IT/ITES
Biotech
Pharma
Textile
Multiproduct
Others
Generally the developments permitted under 100% FDI are: 1. Export Oriented Units (EOU) 2. Industrial Parks 3. Electronic Hardware Technology Parks 4. Software Technology Parks Units
EXCHANGE RATES Approximate current rates at 11th November 2011 COUNTRY
PER UNIT
INR
Australia
Dollar
52.47
China
RMB
7.70
Eur
68.82
Dollar
6.30
Japan
Yen
0.64
Korea
Won
0.04
Ringgit
15.81
Peso
1.01
NT Dollar
1.14
Baht
1.60
UK
Pound
80.10
USA
Dollar
49.78
Europe Hong Kong
Malaysia Philippines Taiwan Thailand
RELEVANT WEBSITES Government of India Government of India Directory Ministry of Finance Ministry of Commerce & Industry Ministry of Statistics and Programme Implementation Ministry of Law & Justice Ministry of Labour Ministry of Home Affairs (MHA) Ministry of External Affairs Ministry of Urban Development Office of the Economic Advisor Central Public Works Department Supreme Court of India
http://goidirectory.nic.in/ http://finmin.nic.in http://dipp.nic.in http://mospi.gov.in http://lawmin.nic.in http://labour.nic.in http://mha.nic.in http://meaindia.nic.in http://urbanindia.nic.in http://eaindustry.nic.in http://www.cpwd.gov.in http://supremecourtofindia.nic.in
Government Bodies Reserve Bank of India Bureau of Indian Standards Insurance Regulatory and Development Authority
http://rbi.org.in http://bis.org.in http://irdaindia.org
Construction Related Organisations The Institution of Engineers The Indian Institution of Valuers The Indian Institute of Architects Construction Industry Development Council
http://ieindia.org http://iivindia.org http://iia-india.org http://cidc.in
Others National Stock Exchange of India Ltd. Bombay Stock Exchange Limited Davis Langdon & Seah Asia
http://nseindia.com http://bseindia.com http://www.dlsqs.com
About Us Davis Langdon & Seah (Malaysia) Sdn Bhd, which was first set up as Langdon & Every (Far East) in Kuala Lumpur in 1947 is amongst the longest established Quantity Surveying firm in Malaysia and pride ourselves with having the most complete set of database on the major projects that have been implemented in the country since Independence. Davis Langdon & Seah (Malaysia) Sdn Bhd practises in conjunction with our local sister practices of Juru Ukur Bahan Malaysia (JUBM) and JUBM Sdn Bhd. Jointly, we have accumulated a wealth of information and knowledge of local construction practice, customs, costs and useful data from the numerous projects that have been entrusted to us. Juru Ukur Bahan Malaysia was established in 1972 and is one of the earliest fully Malaysian Quantity Surveying practices to be set up in Malaysia. Today, the DLS-JUBM Group is one of the largest Quantity Surveying and Construction Cost Consultancy practices in Malaysia with some 250 staff throughout Malaysia working from five main offices situated at Kuala Lumpur, Penang, Johor Bahru, Kota Kinabalu and Kuching. The DLS-JUBM Group had successfully participated as Quantity Surveyors and Cost Managers providing capital budgeting, cost management, cost control, financial, contractual advisory and other related services in the full spectrum of development works in Malaysia for both Government and the Private Sector. Our experience covers participation in project evaluation, value management and feasibility/market studies as well as in the physical implementation of capital projects. We have also developed our competencies in undertaking project management, legal support and management consultancy services. Davis Langdon & Seah (Malaysia) Sdn Bhd is a member of Davis Langdon & Seah which constitutes a regional partnership of Quantity Surveyors and Construction Cost Consultants offering clients the services of more than 2,800 staff based in 40 offices in 13 countries. Global Reach .... Local Delivery
Davis Langdon & Seah (Malaysia) Sdn Bhd (520443-H) Juru Ukur Bahan Malaysia JUBM Sdn Bhd (27638-X) Quantity Surveyors & Construction Cost Consultants
Quality Management System It is a policy of the Davis Langdon & Seah (Malaysia) Sdn Bhd together with its associated local companies, namely Juru Ukur Bahan Malaysia and JUBM Sdn Bhd (“The Company”) to ensure that the quality of the services provided are consistently of a high professional level and shall be no less than the scope of work and brief agreed with the client. Through the implementation and constant improvement of the “Quality Management System”, the Company aims to achieve our vision of becoming the first point of reference for clients. This quality policy is supported by the Company’s commitment in continuing education and training of its staffs, as well as applying the latest technology which are pertinent to their works. Together with our member firms in other regions around the world, we aim to have global reach whilst at each locality we have hands-on experience to deliver our services. The Company achieved the accreditation to ISO 9001 by the Standard & Industrial Research Institute of Malaysia (SIRIM) since May 1995 and we are also the first Quantity Surveying Consultancy firm in Malaysia to have successfully obtained such certification. We have since upgraded our quality management system to the new MS ISO 9001:2008 standards. We believe the application and implementation of the Company’s Quality Management System provides us with significant opportunities for: Improved service performance and client satisfaction; Improved productivity and efficiency; Increased competitive advantage through improved organisational capabilities; and Instilling confidence of clients and other interested parties in the Company.
MALAYSIA
D IT ED C
BO
DY
AC
CRE
N ERTIFICATIO
MS ISO/IEC GUIDE 62:1999 QS 02121999 CB 01
Certified to ISO 9001 : 2008 Cert. No. : AR0595 / AR0598 / AR0599
Environmental Health & Safety Davis Langdon & Seah (Malaysia) Sdn Bhd is committed in addressing the delicate balance between maintaining profitability and reducing environmental impact insofar as possible in the company’s daily practise, processes and business activities. To this end, we - together with our associate local company JUBM Sdn Bhd - have put in place an Environmental Management System (EMS) that identifies all aspects of the business which impacts on the environment as well as the relevant environmental laws in the industry. From the EMS is then derived the company’s Environmental Health and Safety (EHS) Policy Statement which lists the quantifiable objectives under the EMS for the company and its staff as well as the management programme to achieve them on a continuous basis. The company’s EMS adopts the best available techniques that are appropriate, economical and cost effective in achieving these objectives in terms of measurability and practicability. Our efforts in incorporating the EMS and the EHS Policy into the practice, processes and business activities were given due recognition on 27 February 2009 when Davis Langdon & Seah (Malaysia) Sdn Bhd and JUBM Sdn Bhd received the globally recognised MS ISO 14001 accreditation in another industry landmark achievement for the group.
Construction Cost Specification The costs for the respective categories given on the following pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter, and are inclusive of lift shafts, stairwells, plant rooms, water tanks and the like. The costs per square metre excludes local infrastructure cost. All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs excludes land cost, professional fees, finance costs and legal expenses. The standards for each category of building vary from country to country and do not necessary follow those of Malaysia.
INDUSTRIAL Flatted factories exclude manufacturing equipment, airconditioning and electrical distribution system to tenants areas. Owner operated factories exclude manufacturing equipment, airconditioning and special services provisions.
HOTELS F.F.&E. includes interior decoration and loose furniture etc. but excludes operator’s items (e.g. cutlery, crockery, linen etc.).
OTHERS Carparks to be multi-storey, above ground. Schools with standard government provisions. Student hostels to university standard.
DOMESTIC Average standard apartments of 6-10 units per floor, 46m2 - 83m2 per unit. Air conditioning allowed for luxury apartments and prestige houses. Prestige houses include provision of functional light fittings only. Interior fit-out and decoration is excluded. No light fittings have been allowed for other types of domestic construction.
OFFICE / COMMERCIAL Based on buildings 20-30 storeys high with floor plans minimum 1,000m2 per level. Average standard offices and shopping centres exclude A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations, granite finishes lobbies with A/C ducting and light fittings to tenants area.
KUALA LUMPUR CONSTRUCTION COST TREND 2001 - 2011 Domestic
Industrial RM/m2
RM/m2 3,000
1,800 1,600
2,500
1,400
2,000
1,200
1,500
1,000
1,000
600
800 400
500
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Bungalows (mass housing) Terraced houses Average standard apts, high rise Low cost flats, low rise (<6 levels)
0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Detached houses and bungalows* Luxury apts, high rise Low cost flats, high rise (<15 levels) Low cost housing
Office / Commercial RM/m2
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise
Hotels
RM/m2
3,500
8,000
3,000
7,000 6,000
2,500
5,000
2,000
4,000 3,000
1,500
2,000
1,000
1,000 0
500
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Average standard offices, high rise Prestige offices, high rise* Shopping Centres
* Cost are at lower range cost All cost are at an average level unless otherwise stated
Resort Hotel inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto*
FIT-OUT COSTS FOR KUALA LUMPUR DESCRIPTION
RM/m2
HOTELS Public Area (Front of House): 3 - star Hotel 2,200 - 2,990 4 - star Hotel 2,900 - 3,600 5 - star Hotel 3,600 - above Guest Rooms: 3 - star Hotel 1,100 - 1,550 4 - star Hotel 1,500 - 2,370 5 - star Hotel 2,300 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, chandelier, building shell, operational items and equipment (e.g. bed, cutlery crockery, linen, television, refrigerator etc.), opening expenses, stage equipment and computer systems. OFFICES General Office 430 570 Executive Office 570 930 Prestige Office 930 - above Notes: 1. Local furniture allowed for general offices. 2. Includes furniture, partitioning, minor alteration to airconditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, Local Area Network, office equipment (e.g. computers, photocopies, fax machines, UPS, etc). RESTAURANTS General dining restaurant 1,800 - 3,300 Fine dining restaurant 5,000 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.).
DLS - JUBM BUILDING WORKS COMPOSITE TENDER PRICE INDEX (BWCTPI) Tender Price Index
190.0
180.1
180.0 170.0 160.0
152.3
150.0 137.2
140.0 130.0
100.0
111.3 97.8
90.0
101.2
93.6 90.6 91.7 98.1 100.0 97.8 96.6
153.8 146.3 142.1 143.2 141.0 149.9 146.0 141.6 141.3
147.2 137.3
145.7
135.7
122.8
120.0 110.0
161.3
133.4
118.0
92.2
80.0 70.0
74.2
60.0 50.0
Base Year = 2000
Source: JUBM & DLS
Projection 1H 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2010
Q4 2009
Q3 2009
Q2 2009
Q1 2009
Q4 2008
Q3 2008
Q2 2008
Q1 2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1983
1982
40.0
LS - JUBM BUILDING WORKS COMPOSITE TENDER PRICE INDEX (BWCTPI) Tender Price Index
190.0
180.1
180.0 170.0 160.0
152.3
150.0 137.2
140.0 130.0
100.0
111.3 97.8
90.0
101.2
93.6 90.6 91.7 98.1 100.0 97.8 96.6
153.8 146.3 142.1 143.2 141.0 149.9 146.0 141.6 141.3
147.2 137.3
145.7
135.7
122.8
120.0 110.0
161.3
133.4
118.0
92.2
80.0 70.0
74.2
60.0 50.0
Base Year = 2000
Source: JUBM & LS
Projection 1H 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2010
Q4 2009
Q3 2009
Q2 2009
Q1 2009
Q4 2008
Q3 2008
Q2 2008
Q1 2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1983
1982
40.0
Green Building A Green Building focuses on increasing the efficiency of resource use while reducing building impact on human health and the environment during the building’s lifecycle, through better sitting, design, construction, operation, maintenance, and removal.
Green Building Index The launching of the Green Building Index (GBI) in May 2009 was an important milestone in the push for a more sustainable construction industry in Malaysia. Co-developed by Pertubuhan Akitek Malaysia (PAM) and Association of Consulting Engineers Malaysia (ACEM), the GBI is a voluntary rating tool based on six criteria: Energy Efficiency (EE) Improve energy consumption by optimising building orientation, minimizing solar heat gain through the building envelope, harvesting natural lighting, adopting the best practices in building services including use of renewable energy, and ensuring proper testing, commissioning and regular maintenance. Indoor Environmental Quality (EQ) Achieve good quality performance in indoor air quality, acoustics, visual and thermal comfort. These will involve the use of low volatile organic compound materials, application of quality air filtration, proper control of air temperature, movement and humidity. Sustainable Site Planning and Management (SM) Selecting appropriate sites with planned access to public transportation, community services, open spaces and landscaping. Avoiding and conserving environmentally sensitive areas through the redevel-opment of existing sites and brownfields. Implement-ing proper construction management, storm water management and reducing the strain on existing infrastructure capacity. Water Efficiency (WE) Rainwater harvesting, water recycling and water-saving fittings. Materials and Resources (MR) Promote the use of environment-friendly materials sourced from sustainable sources and recycling. Implement proper construction waste management with storage, collection and re-use of recyclables and construction formwork and waste. Innovation (IN) Innovative design and initiatives that meet the objectives of the GBI.
Green Incentives The government, for example, offers tax exemptions on green incentives that help lower capital costs for owners and operators.
Existing Incentives Income Tax (Plant Annual Allowances) Rules 2000 Income Tax (Accelerated Capital Allowances) (Conservation of Energy) Rules 2001 New Incentives* Income Tax (Exemption) (No.8) Order 2009 Stamp Duty (Exemption) Order 2009
* Effective for GBI Certified Buildings from 24 Oct 2010 to 31 Dec 2014.
Cost of Building Green The additional premium in construction cost to build a green building would depend very much on the level of green rating (Basic to Silver, Gold or Platinum) that is being targeted. Green buildings submitted for certification are assessed on the abovementioned six criteria and the points scored would determine its green rating. Due to the wide and numerous variables in building designs, it would make it wholly inappropriate and even simplistic to assign a so-called “typical” percentage in cost premiums to achieve the said ratings. Generally, it is suggested that the higher the rating - e.g. Gold and Platinum - and complexities of the green features would increase the construction cost.
Green Points Table A lists examples where the GBI points can be scored; thus outlining the green features which could be included in a building’s construction planning and design. This would include open ventilation, building orientation, parking facilities for car poolers as well as hard - and green - scapes.
Points
GBI Rating
86+ points
Platinum
76 to 85 points
Gold
66 to 75 points
Silver
50 to 65 points
Certified
Table A
GBI Points Sourcing (Non-Residential) Criteria Energy Efficiency (Max Points: 35)
Indoor Environmental Quality (Max Points: 21) Sustainable Site Planning &Management (Max Points: 16)
Possible additional costs Nominal Moderate Substantial Management Control System (1) EE1: Energy EE2: Flexible lighting control (3) EE4:Encourage renewable energy (5) EE5: Advanced EE performance of up to EE6: Commissioning of Building Energy System (3) BEI* between 90 - 150 (15) EE9: Sustainable maintenance beyond defect & liability period (3) EQ2:Minimise exposure to EQ9: Daylight Glare Control (1) Environmental Tobacco Smoke (1) EQ4: Low VOC building materials (2) EQ6: Individual comfort controls (2) SM1: Site selection (1) SM3: Community connectivity (2) SM10: Nominal parking capacity (1) SM13: Building User Manual (1) SM4: Conservation and open spaces (2) SM12: Heat reducing hardscape, greenery and roof applications (2) MR1:Reuse of Building Materials (2) MR2: Usage of materials with recycled contents (2)
Materials & Resources (Max Points: 11)
MR5: Recyclable materials storage (1)
Water Efficiency (Max Points: 10)
MR7: Environmental-friendly refrigerants and cleaning agents (2) WE1: Rainwater Harvesting (2) WE4: Water efficient fittings (2) WE5: Submeters and detection of water leakage (2) IN2: GBI Facilitator appointment (1) IN1: Innovation in design and environmental initiatives (6)
Innovations (Max Points: 10)
Notes: BEI = Building Energy Intensity in kWh/m2 of annual energy usage
Finding Balance The green building rating is geared towards the objective of pushing the boundaries in building efficiency. Accreditation focuses on the whole construction process to achieve this right from the design stage through to completion. Additional cost premiums to achieve the green rating depending very much on the objectives of a particular building’s efficiency. This additional premium could be recouped over a period of time from the cost savings in energy and water bills, but the greater value would be in its overall contribution towards reducing negative environmental impact. Source: - JUBM/DLS Malaysia Construction News & Views, Issue 2 April 2010 - www.greenbuildingindex.org
MR4: Use of sustainable timber (1)
GBI points in ( )
Estimating Rules of Thumb Composition of Concrete (per m 3 )
Structure Design - Concrete Ratios The following is a range of concrete ratios for building
Mix
Cement
Sand
Aggregate
1:3:6
216kg
0.45m3
0.90m3
1:2:4
308kg
0.43m3
0.86m3
1:1:2
540kg
0.38m3
0.75m3
Weight of Concrete Items
superstructure design: Concrete/floor area
0.4 m3/m2 to 0.5 m3/m2
Formwork/floor area
2.2 m2/m2 to 3.0 m2/m2
Reinforcement
160 kg/m3 to 250 kg/m3
Average External Wall/Floor Ratio
Item
Weight
Concrete
2,400 kg/m3
Cement
1,441 kg/m3
Sand
1,600 kg/m3
Aggregate
1,350 kg/m3
Steel
7,843 kg/m3
Average Loads
Volume
Residential Apartments
1.0 m2/m2
Office, Hotel Industrial
0.4 m2/m2 0.4 m2/m2
Average Internal Wall/Floor Ratio Residential Apartments
1.0 m2/m2
Office Hotel
0.5 m2/m2 1.5 m2/m2
Air - Conditioning Lorry
10.0 m3
Concrete truck (24 ton)
5.5
Barge
m3
200 - 1,450 m3
Dimensions for Standard Parking Space, Loading/ Unloading Bays and Lay-bys
Average
0.05 tonne/m2 of floor area
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particular small foot prints. Indicative Dimensions for Sports Grounds
Minimum Private Cars, Taxis
Length
Width
5 m
2.5 m
Headroom 2.4 m
and Light Vans Coaches and Buses
12 m
3.0 m
3.8 m
Lorries
11 m
3.5 m
4.1 m
Container Vehicles
16 m
3.5 m
4.5 m
Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilation duct, conduits or similar.
Length
Width
Tennis Court
40 m
20 m
Squash Court
13 m
6 m
Basketball Court
38 m
23 m
Volleyball Court
30 m
20 m
Badminton Court
20 m
10 m
Rink
61 m
26 m
Soccer Playing Field Futsal
110 - 120 m 70 - 80 m 25 - 42 m 15 - 25 m
The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed.
Technical Specifications Table for Standard BRC Fabrics BRC Ref. No.
BS 4483 or SS-32 Ref No.
A 10 A9 A8 A7 A 6/5 A5 A4
A 393 A 252 A 193 A 142 A 98 -
B 12 B 10 B9 B8 B7 B6 B5
B 1131 B 385 B 503 B 385 B 283 B 196
Main Wire Cross Wire Size Spacing Size Spacing mm mm mm mm SQUARE MESHES 200 10 200 10 200 9 200 9 200 8 200 8 200 7 200 7 200 6.5 200 6.5 200 6 200 6 200 5 200 5 200 4 200 4 RECTANGULAR MESHES 200 8 100 12 200 8 100 10 200 8 100 9 200 8 100 8 200 7 100 7 200 7 100 6 200 7 100 5
C 10 C9 C8 C7 C6 C5
C 785 C 636 C 503 C 385 C 283 -
10 9 8 7 6 5
400 400 400 400 400 400
6 6 5 5 5 5
100 100 100 100 100 100
Cross-Sectional Area Main Cross mm2/m mm2/m
Mass Per Unit Area Kg/m2
393 318 252 193 166 142 98 63
393 318 252 193 166 142 98 63
6.16 4.99 3.95 3.02 2.61 2.22 1.54 0.99
1131 785 636 503 385 283 196
252 252 252 252 193 193 193
10.90 8.14 6.97 5.93 4.53 3.73 3.05
785 636 503 385 283 196
71 71 49 49 49 49
6.72 5.55 4.34 3.41 2.61 1.93
STANDARD SIZES Rolls (Ref. No’s: A4, A5, A6, A6/5 only) Length : 40.0 metres Width : 2.0 metres Sheets (all Ref. No’s) Length : 6.0 metres Width: 2.2 metres
Weight Tables for Mild Steel Round Bars & High Tensile Deformed Bar Unit No. of Pcs. Weight Cross Std. Size (mm) High Yield Mild Steel Sectional Weight 12m Length Per Bundle (MT) Deformed Round Area (mm2) (kg/m) Per Bundle D6 D8 D9 D 10 D 12 D 16 D 20 D 22 D 25 D 28 D 32 D 35 D 38 D 40
Ø6 Ø8 Ø9 Ø 10 Ø 12 Ø 16 Ø 20 Ø 22 Ø 25 Ø 28 Ø 32 Ø 35 Ø 38 -
28.3 50.3 63.6 78.5 113.1 201.1 314.2 380.1 490.9 615.8 804.2 962.1 1,134.1 1,256.6
0.222 0.395 0.499 0.616 0.888 1.579 2.466 2.984 3.854 4.834 6.313 7.553 8.903 9.864
376 210 168 138 96 54 34 28 22 18 14 12 10 9
1.002 0.995 1.006 1.020 1.023 1.023 1.006 1.003 1.017 1.044 1.061 1.088 1.068 1.065
* High Yield Deformed Bar Standard Length : 12 metres straight. * Mild Steel Round Bar Standard Length : 12 metres straight or 12 metres once folded. * Special cut length can be produced from 6m to 15m on a certain min. quality per size per order upon request.
CONSTRUCTION SECTOR INDICATORS % Change 80
Production (% Change) Other Articles of Concrete, Basic Iron and Construction 2011 Cement & Plaster Steel Products Related Products
60 40
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
20 0
-40
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct
-20
2010
2011
Other articles of concrete, cement and plaster Basic iron and steel products Production of construction related products
- 17.3 - 12.5 - 21.7 - 4.1 2.9 - 3.5 12.9 20.9 46.2 17.8
13.8 16.4 15.7 6.5 22.7 17.9 20.9 8.2 10.3 12.5
9.3 27.7 4.2 - 3.5 2.1 2.9 25.6 - 3.8 - 9.3 6.8
Note: All rates are based on the new Industrial production Index (2005 = 100). November and December rates are not available at time of publication. Source: Monthly Statistical Bulletin, November 2011, Central Bank of Malaysia.
Number
RM Million
Housing Approvals* (number) Loans Approved for Construction Sector (RM miliion)
25,000 20,000 15,000 10,000
0
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov
5,000
2008
Jan
Feb
2009
Mar
Apr
2010
May
Jun
5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0
2011
Jul
Aug
9,005 8,258 13,180 12,655
10,912 16,665
Sep
Oct
Nov
Dec
Housing Approvals* (number)
2010 2011
6,965 12,455
5,757 12,349 8,766 11,781
9,183 11,766 9,354 11,639
10,037 9,865 13,769 12,935 15,674 13,463 20,142 N/A
Loans Approval for Construction Sector (RM million)
2010 2011
1,602 1,867
1,120 1,421
1,793 2,552
1,643 2,738
1,492 1,915
2,288 2,496
2,391 1,779
2,165 2,551
3,094 1,755
2,287 2,991
3,356 4,666
2,292 N/A
Source: Monthly Statistical Bulletin, November 2011, Central Bank of Malaysia. * No. of housing units by private developers approved for construction by the Ministry of Housing and Local Government in Peninsular Malaysia.
AVERAGE UNIT PRICES FOR CEMENT IN MALAYSIA PENINSULAR MALAYSIA North
Central
East
2011
SABAH Kota Kinabalu
Sandakan
SARAWAK Tawau
Kuching
Sibu
Miri
RM/Bag (50 kg)
Jan Feb
15.53 15.61
16.03 16.03
15.86 15.86
17.00 17.00
19.88 19.75
20.50 20.00
16.09 16.09
16.75 16.75
16.38 16.38
Mar Apr May
16.16 16.65 16.63
16.19 16.60 16.69
15.88 16.14 16.18
17.00 17.00 17.00
19.75 19.75 19.75
20.00 20.00 20.00
16.09 16.09 16.09
16.75 16.75 16.75
16.38 16.38 16.38
Jun Jul
16.63 16.60
16.74 16.86
16.18 16.32
17.00 17.00
19.75 19.75
20.00 20.00
16.09 16.09
16.75 16.75
16.38 16.38
Aug Sep Oct
16.80 16.82 16.80
16.93 16.92 16.85
16.32 16.32 16.32
17.25 17.38 17.38
19.88 19.88 19.75
20.00 20.00 20.00
16.79 16.79 16.79
17.42 17.42 17.42
16.95 16.95 16.95
Nov
16.77
16.90
16.32
17.38
19.75
20.00
16.79
17.42
16.95
Note: December 2011 rates are not available at time of publication. Source: Special Release 1 for Peninsular Malaysia, Sabah & Sarawak, by Department of Statistics, Malaysia
CONSTRUCTION COST FOR KUALA LUMPUR RM/m2 SERVICES
BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
TOTAL
1,302 1,974 662 893 2,064 368 462 520
- above - above 903 - 1,334 - above 399 499 572
903 809 168 289 793 99 121 179
- above - above 278 441 - above 131 189 242
2,205 2,783 830 1,181 2,857 467 583 698
- above - above - 1,181 - 1,775 - above 530 688 814
1,344 1,896 1,355
- 1,481 - above - 1,754
940 1,402 830
- 1,155 - above - 1,155
2,284 3,298 2,184
- 2,636 - above - 2,909
2,825 3,429 5,325
- 2,988 - 3,838 - above
1,250 1,192 1,875
- 1,565 - 1,444 - above
4,075 - 4,553 4,621 - 5,283 7,199 - above
782 1,013
-
798 1,008
530 593
-
693 751
1,313 1,607 -
1,491 1,759
840 1,124
-
998 1,218
362 483
-
520 583
1,202 1,607 -
1,518 1,801
971 572 630 809 1,623
-
1,145 730 719 871 1,722
368 210 189 242 540
-
467 289 210 289 641
1,339 782 819 1,050 2,163
1,612 1,019 929 1,160 2,363
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
-
UNIT PRICES FOR UNLEADED PETROL, DIESEL & LIQUEFIED PETROLEUM GAS IN PENINSULAR MALAYSIA
240
185
220
180
200 180
175
160
170
140
Source: Ministry of Domestic Trade, Co-operatives and Consumerism
16-Jun-11
4-May-11
165
2-Apr-11
120
31-Jan-11
175 175 175 185 185 185 190 190 190 190 190
5-Jan-11
180 170 170 175 175 175 180 180 180 180 180
4-Dec-10
175 185 185 190 190 190 190 190 190
2-Nov-10
190 180 180 210 215 230 240 250 270 290 280
16-Jul-10
03-Dec-08 16-Dec-08 12-May-09 16-Jul-10 02-Nov-10 04-Dec-10 05-Jan-11 31-Jan-11 02-Apr-11 04-May-11 16-Jun-11
190
260
12-May-09
175
16-Dec-08
190
3-Dec-08
-
280
18-Nov-08
200
Cent/Kg 195
Unleaded Petrol RON 97 Unleaded Petrol RON 95 Diesel Fuel Liquefied Petroleum Gas
1-Nov-08
18-Nov-08
Cent/Litre 300
15-Oct-08
Liquefied With Petroleum Gas (LPG) Effective RON 97 RON 95 (Cent/Litre) (Cent/Litre) (Cent/kg)
25-Sep -08
Diesel Fuel
23-Aug -08
Unleaded Petrol
COMMODITIES PRICE TREND (JAN TO DEC 2011) Nickel
Aluminium
USD/Tonne 29,500
USD/Tonne 2,800
28,500 2,700
27,500 26,500
2,600
25,500
2,500
24,500
2,400
23,500 22,500
2,300
21,500 2,200
20,500 19,500
2,100
18,500 2,000
17,500 16,500
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
1,900
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Copper (Grade A) USD/Tonne 10,500
10,000
9,500
9,000
8,500
8,000
7,500
7,000
6,500
Jan
Feb
Mar
Apr
May
Source: London Metal Exchange
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Year 2011
Aluminium
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2,438.73 2,507.33 2,551.76 2,661.92 2,591.18 2,554.66 2,511.19 2,391.66 2,295.93 2,171.48 2,072.75 2,023.58
Copper (Grade A)
Nickel
Monthly Average (USD / Tonne)
9,554.13 9,866.75 9,529.57 9,482.56 8,925.93 9,044.80 9,618.36 9,040.34 8,313.82 7,346.71 7,550.95 7,569.43
25,638.50 28,246.75 26,803.04 26,321.39 24,203.00 22,344.32 23,721.43 22,075.23 20,384.55 18,879.29 17,876.82 18,129.50
MALAYSIA TIMBER PRICES Monthly Average - Year 2011
Yearly Average
(USD/m3) Jan
Feb
Mar
Apr
May
Jun
N/A N/A N/A
493 294 345
497 300 350
500 303 352
N/A N/A N/A
462 427 396
469 434 405
470 435 407
Jul
(USD/m3)
(RM/m3) USD$1 = RM3.15 Nov Dec* 2010 2011 2010 2011
% Change
Aug
Sep
Oct
505 307 354
510 309 356
512 310 356
512 310 356
512 310 356
511 486 309 284 354 339
503 1,529.98 1,584.45 303 893.81 954.45 351 1,066.40 1,105.65
3.56 % 6.78 % 3.68 %
473 439 410
478 443 414
479 444 415
478 444 415
475 442 413
474 444 440 408 412 375
470 1,397.15 1,480.50 435 1,283.75 1,370.25 406 1,182.44 1,278.90
5.97% 6.74 % 8.16 %
MALAYSIA SAWNWOOD
Domestic Merbau 491 Kempas 290 Balau 343
492 291 344
MALAYSIA PLYWOOD
2.7 mm 3.0 mm 9.0 mm
455 419 387
457 422 391
Note: * 1st Half of December 2011 only. Rates for March 2011 are not available due to earthquake Source: International Tropical Timber Organisation (www.itto.or.jp)
MALAYSIA CONSTRUCTION SECTOR - EMPLOYMENT & GDP Employment (’000)
% 6.90
770.0
6.80 6.70
765.0
6.60 6.50
760.0
6.40 6.30
755.0
6.20 6.10
750.0
06
07
08
09
10
11*
6.00
Year Employment for Construction Sector Contribution to Total Employment
GDP (RM million)
%
20,000
3.35 3.30
18,000
3.25 3.20
16,000
3.15 3.10
14,000
3.05 12,000
06
07
08
09
10
11*
12**
3.00
Year Gross Domestic Product (GDP) for Construction Sector Contribution to Total GDP Note: * Estimate by Ministry of Finance Malaysia ** Forecast by Ministry of Finance Malaysia Source: Economic Report 2011/2012, Ministry of Finance, Malaysia
CONSTRUCTION COST FOR JOHOR BAHRU BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
1,390 2,025 720 910 1,800 410 450 465
-
above above 810 1,079 above 415 530 545
810 675 80 250 600 90 100 135
-
above above 90 296 above 95 120 155
2,200 2,700 800 1,160 2,400 500 550 600
-
above above 900 1,375 above 550 650 700
1,130 1,650 1,185
-
1,385 above 1,435
670 1,270 615
-
815 above 765
1,800 2,920 1,800
-
2,200 above 2,200
2,100 2,550 3,960
-
2,220 2,855 above
1,044 955 1,410 -
1,205 1,140 above
3,144 3,505 5,370
-
3,425 3,995 above
700 850
-
770 915
400 510
-
680 720
1,100 1,360
-
1,450 1,635
690 1,020
-
770 1,155
255 430
-
460 495
945 1,450
-
1,230 1,650
680 460 560 700 1,400
-
835 690 640 865 1,635
220 140 140 180 400
-
265 210 160 220 465
900 600 700 880 1,800
-
1,100 900 800 1,085 2,100
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COST FOR PENANG BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
900 1,780 570 870 1,100 420 440 455
-
above above 700 1,030 above 470 520 600
450 870 95 285 450 65 140 170
-
above above 125 330 above 70 180 200
1,350 2,650 665 1,155 1,550 485 580 625
-
above above 825 1,360 above 540 700 800
1,100 1,600 1,200
-
1,300 above 1,400
900 1,250 720
-
1,000 above 850
2,000 2,850 1,920
-
2,300 above 2,250
2,200 2,700 4,300
-
2,500 3,300 above
1,000 960 1,500
-
1,300 1,450 above
3,200 3,660 5,800
-
3,800 4,750 above
620 650
-
800 800
500 580
-
630 700
1,120 1,230
-
1,430 1,500
510 540
-
680 820
500 400
-
560 600
1,010 940
-
1,240 1,420
650 460 575 650 1,300
-
780 595 650 740 1,450
270 200 160 195 500
-
300 270 200 240 610
920 660 735 845 1,800
-
1,080 865 850 980 2,060
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COSTS FOR KOTA KINABALU RM/m2 SERVICES
BUILDING DOMESTIC
TOTAL
1,360 2,060 700 940 2,160 380 470 550
-
1,450 above 940 1,390 above 410 530 600
419 992 287 353 926 121 165 209
-
529 above 342 419 above 165 187 221
1,779 3,052 987 1,293 3,086 501 635 759
-
1,979 above 1,282 1,809 above 575 717 821
Average standard offices, high rise Prestige offices, high rise Shopping centres
1,390 1,980 1,410
-
1,580 above 1,930
860 1,433 860
-
992 above 992
2,250 3,413 2,270
-
2,572 above 2,922
HOTELS
2,950 3,590 5,570
-
3,130 4,010 above
1,158 1,422 2,282
-
1,422 1,566 above
4,108 5,012 7,852
-
4,552 5,576 above
820 1,050
-
880 1,100
419 496
-
518 562
1,239 1,546
-
1,398 1,662
880 1,180
-
1,090 1,330
353 419
-
419 507
1,233 1,599
-
1,509 1,837
890 600 650 850 1,690
-
1,050 760 750 920 1,800
243 187 232 254 706
-
287 221 364 287 860
1,133 787 882 1,104 2,396
-
1,337 981 1,114 1,207 2,660
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies.
CONSTRUCTION COST FOR KUCHING BUILDING DOMESTIC
Bungalow (mass housing) Detached houses and bungalows Terraced houses Average standard apartments, high rise Luxury apartments, high rise Low cost housing Low cost flats, low rise (<6 levels) Low cost flats, high rise (<15 levels) OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres HOTELS
Resort hotels, inclusive of F.F.&E. 3-star budget hotels, ditto 5-star luxury hotels, ditto INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car parks (<3 levels) Elevated car parks (<4 levels) Primary and Secondary schools Student hostels Sports clubs including F.F.&E.
RM/m2 SERVICES
TOTAL
1,030 1,600 900 1,050 1,460 520 730 780
-
1,160 above 970 1,140 1,580 590 790 850
440 770 150 280 790 110 150 160
-
530 above 190 380 950 130 170 220
1,470 2,370 1,050 1,330 2,250 630 880 940
-
1,690 above 1,160 1,520 2,530 720 960 1,070
1,440 1,680 1,570
-
1,690 above 1,700
880 1,510 760
-
1,000 above 950
2,320 3,190 2,330
-
2,690 above 2,650
2,640 2,830 4,550
-
3,040 3,100 above
1,310 1,500 2,300
-
1,580 1,650 above
3,950 4,330 6,850
-
4,620 4,750 above
950 1,010
-
1,180 1,170
340 400
-
370 480
1,290 1,410
-
1,550 1,650
750 1,020
-
880 1,170
280 420
-
390 500
1,030 1,440
-
1,270 1,670
1,030 800 910 1,100 1,690
-
1,140 900 1,030 1,240 1,820
350 220 210 240 680
-
370 230 330 290 820
1,380 1,020 1,120 1,340 2,370
-
1,510 1,130 1,360 1,530 2,640
The above costs are at 4th Quarter 2011 levels, inclusive of preliminaries (10%) but exclusive of contingencies
MAJOR RATES FOR MALAYSIA RM
1. Excavating basement ≤ 2m deep 2. Excavating for footings ≤ 1.5m deep 3. Remove excavated materials off site 4. Hardcore bed blinded with fine materials 5. Mass concrete grade 15 6. Reinforced concrete grade 30 7. Mild steel rod reinforcement 8. High tensile rod reinforcement 9. Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting 13. Aluminium casement windows, single glazed 14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
m3 m3 m3 m3 m3 m3 kg kg
KUALA LUMPUR
15 15 20 60 230 250 3.50 3.50
- 20 - 20 - 25 - 70 - 250 - 280 - 3.80 - 3.80
PENANG
12 13.6 5 50 225 230 3.40 3.40
- 16.5 - 21.8 - 13 - 70 - 265 - 270 - 3.80 - 3.80
JOHOR BAHRU KOTA KINABALU
18 13 12 70
KUCHING
- 21 - 15 - 15 - 80 255 280 3.50 - 4.00 3.50 - 4.00
12 15 10 100 310 356 3.70 3.60
15 15 15 75 280 330 3.50 3.50
m2 m2 m2
30 - 38 30 - 38 32 - 45
25 - 34 25 - 34 35 - 40
35 35 45 - 50
36 36 40
38 38 38
m2
55 - 60
60 - 85
75 -
86*
86
m2
350 - 500
260 - 360
250 - 350
250 - 350
320
kg
6.00 - 7.50
5.50 - 9.00
7.50 - 8.50
6.50 - 7.00
7
kg m2
6.00 - 7.50 15 - 22
5.50 - 9.00 13.5 - 19.0
7.50 - 8.50 18 - 23
6.50 - 7.00 17
7 18
m2 m2 m2 m2 %
22 70 45
12 - 21 35 - 70 21 - 35
3.50 - 4.50 6 - 12
15 50 30 -
23 55 35 -
80
25 65 45
18 78 56
15 68 55
3.20 - 5.00
4.50 - 5.50
8.50
11
3 - 5
4.50 - 7.50
4 - 7
8.5
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies and preliminaries. * Rates is for “Kliplok Colorbond” 0.54mm profiled steel sheeting.
ACMV Costs for Various Designs & Developments in Kuala Lumpur ACMV : Air Conditioning & Mechanical Ventilation System
RM/m2 of Construction Floor Area
RM/Tonne of Refrigeration
500
8000 400
400
200
4000 2000
Central Constant Air Volume
Central Variable Refrigerant Volume
RM/m2 of Construction Floor Area
10000 400
391
7500
278
6600 5000
5000
6200
Commercial Complex
1200
Hotel
1300
Factory
2000
Residential
Commercial Complex
Hotel
Residential
Office
0
2000
Office
2500
90
0 Academic Institution
7500
4600
60
Hospital
7500
200
100
8500
7600
Academic Institution
100
280
Central Variable Refrigerant Volume
RM/Tonne of Refrigeration
6500
280 190
200
Central Constant Air Volume
8400
350 310
Central Variable Air Volume
450
Factory
300
0
Hospital
Central Variable Air Volume
450
400
4000
210
100
500
4500
5200
250
260
6000
6650
6000
350
360
300
0
7400
UNIT COSTS FOR ANCILLARY FACILITIES FOR KUALA LUMPUR DESCRIPTION PLAYGROUND EQUIPMENT Outdoor playground equipment comprising various activities and safety mat Minimum recommended area: 13.97m x 13.61m Age group: 4 to 12 Child Capacity: 20 - 30 * Price varies according to equipment and design.
UNIT
per set
SAUNAS Sauna room for 4 - 5 people complete with timber finishes, stainless steel heater with built-in control panel and all accessories per room Size: 5’ x 5’ x 6’6” STEAM BATHS Steam bath for 5 - 6 people complete with steam generator, tempered glass door, ceramic wall tiles, water proofing system, lighting and all accessories Size: 5’ x 5’ x 7’6”
per room
GOLF COURSES (Based on “Average Cost Model” of an 18 hole golf course in Asia). Including fairway construction and rough hydro seeding.
per hole
GOLF SIMULATOR Complete golf simulation system complete with projector, high impact projection screen, artificial grass putting turf, putting green
per set
RM
DESCRIPTION
UNIT
RM
SQUASH COURTS Single court with glass back wall including associated mechanical and electrical services but excluding any public facilities (enclosing structure not included)
per court
46,500
40,000
TENNIS COURTS Single court on grade with acrylic surfacing complete excluding chain link fence
per court
69,000
12,000
SWIMMING POOLS Size: 25m x 10.5m Depth: approx. 1.2m to 1.8m Outdoor swimming pool built on ground, fully tiled, completed with 5m wide deck and associated equipment
per pool
715,000
Extra for heating equipment (solar)
per pool
150,000
Extra for ozone system
per pool
210,000
Size: 25m x 10.5m Depth: approx. 1.8m to 3.0m Indoor swimming pool built with suspended structure (enclosing structure not included) fully tiled and completed with 5m wide deck, including mechanical ventilation and associated equipment
per pool
1,045,000
Extra for heating equipment (solar)
per pool
250,000
Extra for ozone system
per pool
300,000
18,500
2,000,000
275,000
RESIDENTIAL Existing Stock (unit)
Incoming Supply (unit)
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
411,694 1,292,318 4,479 677,542 353,583 387,910 233,123 155,823 264,897 214,693 54,418 56,761 20,801 145,145 11,153 200,256
41,145 136,095 834 82,530 47,383 34,168 66,399 14,627 37,031 27,284 18,310 13,125 1,996 38,444 636 18,316
MALAYSIA
4,484,596
578,323
Residential p Q3 2011
p = preliminary
Projection of Cumulative Supply for High End Condominiums Number of units 35000 30000 25000 20000 15000 10000 5000 0
2008
2009
Bangsar / Damansara Heights
2010 Ampang Hilir / U-Thant
1H2011
2H2011
Mont' Kiara
2012 KL City
Source: Residential Property Stock Report, 3rd Quarter 2011, by Valuation & Property Service Department & Knight Frank
Average Capital Values and Asking Rental Rates for Luxury Condominiums in Kuala Lumpur Average Capital Values RM psf
Average Asking Rental Rates RM psf per month
Asking Prices and Rentals of Existing High End Condominiums (1H 2011)
5.50
1,200
5.00
1,000
971 4.50
800 712 4.00
600
4.00
558
400
3.32 3.12
200
3.50 3.00 2.50
2004
2005
2006
Average Asking Rental Rates for Average Capital Values for
2007
2008
KLCC KLCC
2009
Bangsar Bangsar
Source: CB Richard Ellis and Knight Frank
2010
2011 Q3
Mont Kiara Mont Kiara
Locality
KL City* Ampang Hilir / U-Thant Damansara Heights** Kenny Hills Bangsar ’ Mont Kiara***
Gross Rent (RM psf/month)
3.00 - 6.00 3.00 - 4.00 3.20 - 4.00 3.00 - 4.00 2.50 - 4.50 2.00 - 3.50
Asking Selling Price (RM psf)
700 - 1,800 500 - 900 400 - 900 500 - 900 500 - 1,100 400 - 650
Notes: * Excludes The Binjai On The Park ** Includes Clearwater Residence *** Excludes Verve Suites which comprises mainly fully furnished small units
HOTEL Existing Stock Incoming Supply (Room) (Room)
4-Star
3-Star
65.0 60.0 55.0 50.0 45.0
Q32011p
25,810
2010
2009
2008
2007
2006
2005
2004
2003
40.0
Q22011
173,425
5-Star
Q12011
MALAYSIA
% 70.0
6,587 3,250 359 6,098 654 996 744 1,172 188 1,639 921 557 212 1,048 444 941
2002
31,806 13,903 401 17,398 13,703 9,671 4,764 8,697 9,664 21,472 6,926 3,570 688 14,138 1,013 15,611
2001
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
Average Occupancy Rate of Hotels by Star Rating
2000
Hotel p Q3 2011
P = Prediction
p = preliminary
Source: Leisure Property Stock Report, 3rd Quarter 2011 by Valuation & Property Services Department
Tourist Arrivals & Receipts to Malaysia RM Million
Million
60,000
30
Receipts (RM mil) Arrivals (Mil)
50,000
25
1H 2007 2H 2007 1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
4 Star RM/Night
5 Star RM/Night
180 183 200 202 210 208 209 216 209
290 330 370 377 388 380 345 347 339
2010
2009
2008
2007
0
2006
-
2005
5
2004
10,000
2003
10
2002
20,000
2001
15
2000
30,000
1999
20
1998
40,000
Source: Tourism Malaysia
Average Room Rates for 5-star & 4-star Hotels in Kuala Lumpur City Centre
Source: Knight Frank
OFFICE Major Office Investment Sales in 1H 2011
Approx Lettable Area (SF)
RM psf
Dua Sentral, Jalan Tun Sambanthan
430,000
540
Block 6, The Horizon (Phase 1), Bangsar South
46,100
780
Prima 9, Cyberjaya
111,000 (1)
650
Prima 10, Cyberjaya
100,000 (1)
610
Average Gross Rental per month RM psf 11.00 10.00 9.00
1H08 RM psf
1H09 RM psf
1H10 RM psf
1H11 RM psf
8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00
Vacancy Rates of Office Space in KL City Center Vacancy Rate (%) 25.0%
20.0%
15.0%
10.0%
5.0%
0.0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 3Q 2011
KL City
Golden Triangle
Central Business District
Menara Millenium
Menara HLA
Menara Etiqa Twins
Menara Std Chartered
Menara Citibank
Menara IMC
0.00 Menara Maxis
Notes: (1) Prime 9 and Prime 10 have a total of 374 and 307 car park bays respectively. Source: Knight Frank
Purpose Built Office Existing Stock Occupancy Rate Incoming Supply p Total Space (m2) (%) (m2) Q3 2011
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak MALAYSIA
6,946,558 2,409,106 1,800,605 1,015,878 1,097,496 621,152 280,794 361,096 309,611 298,409 299,879 358,421 90,706 674,554 66,157 578,757
17,209,179
79.60 77.80 86.10 74.80 75.50 93.80 92.10 84.80 91.60 93.40 97.80 95.50 98.50 89.10 80.20 92.10
82.30
1,189,092 431,497 373,348 180,301 38,789 5,071 5,097 17,398 14,305 99,902 16,837 22,128 64,270 67,963 28,022 7,378
2,561,398
p = preliminary
Source: Commercial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Service Department and CB Richard Ellis
SHOPPING COMPLEX Shopping Complex's Existing Stock & Occupancy Shopping Complex Existing Stock Occupancy Rate Incoming Supply Rate in Kuala Lumpur & Selangor (By Location) p Total Space (m2) (%) (m2) Q3 2011 as at Q3 2011
Existing Stock
Occupancy
700,000
%
100
600,000 90
500,000 400,000
80
300,000 200,000
70
1,839,673
Bangsar
Klang
-
Shah Alam
100,000
Bukit Bintang / Jalan Raja Chulan
80.60
m2
Jalan Ampang
10,878,248
635,734 146,763 9,907 213,770 82,176 193,289 44,475 25,344 50,411 32,657 4,265 4,320 6,720 130,271 0 259,569
Central Commercial Area
MALAYSIA
86.90 85.60 75.30 71.30 69.30 86.80 82.40 79.50 75.60 81.70 71.10 87.40 97.80 85.10 98.30 73.00
Subang Jaya / Sunway
2,120,792 2,591,801 67,714 1,507,307 1,406,060 573,940 340,892 358,520 391,772 219,302 86,836 218,534 66,829 535,993 26,063 365,893
Petaling Jaya
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
60
p = preliminary
Source: Commercial Property Stock Report 3rd Quarter 2011 by Valuation & Property Service Department
Klang Valley Prime Retail Rental Index 300
Rental Index (Q4 1995 = 100)
250
Shopping Centres Completed / Scheduled for Completion in 2H2011
200
New Projects
150
Publika Mall @ Solaris Dutamas, Hartamas 1 Shamelin, Cheras Kenanga Wholesale City, Pudu Southgate, Jalan Tun Razak KL Festival City, Setapak Mines 2, Seri Kembangan First Subang, Subang Jaya Space U8, Shah Alam
100 50
Source: CB Richard Ellis
3Q 2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
0
Source: Knight Frank
Estimate Net. Lettable Area (sf)
335,000 420,000 500,000 189,000 450,000 295,000 120,000 574,000
SHOP Shop p Q3 2011
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak MALAYSIA
Existing Stock Incoming Supply (unit) (unit)
23,084 77,317 198 67,521 28,238 42,201 18,182 16,531 25,513 17,379 4,794 8,199 3,346 15,858 794 22,699
1,793 12,154 229 9,539 3,772 3,257 3,415 3,068 3,289 2,817 1,117 2,197 369 1,932 74 1,818
371,854
50,840
Distribution of Existing and Planned Supply of Shop in Kuala Lumpur and Selangor as at Q3 2011
724 ; 8.16%
30,153 ; 30.04%
887 ; 9.99%
7,415 ; 7.39% 2,376 ; 2.37% 240 ; 0.24% 11,353 ; 11.31%
162 ; 1.82% 251 ; 2.83% 370 ; 4.17%
p
Existing
534 ; 0.53% 665 ; 0.66% 1,294 ; 1.29%
543 ; 6.12%
28,306 ; 28.20%
955 ; 10.76%
2,732 ; 30.78% p
Planned Supply
18,035 ; 17.97%
2,253 ; 25.38%
p = preliminary
Pre-War 5-5 1/2 Storey
1-1 1/2 Storey 6-6 1/2 Storey
2-2 1/2 Storey Above 6 1/2 Storey
3-3 1/2 Storey Lock-Up
p = preliminary
Source: Commercial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Service Department
4-4 1/2 Storey SOHO
INDUSTRIAL Distribution of Existing and Planned Supply of Industrial in Kuala Lumpur and Selangor as at Q3 2011
Industrial p Q3 2011
29,346 ; 74.07% 412; 22.42%
689; 37.49%
Existingp
Planned SupplyP 25; 1.36%
121 ; 0.31% 1,386 ; 3.50% 4,803 ; 12.12%
p = preliminary
7; 0.38% 705; 38.36%
3,962 ; 10%
Terraced
Semi-Detached
Flatted Factory
Industrial Complex
Detached
Existing Stock Incoming Supply (unit) (unit)
Kuala Lumpur Selangor W.P. Putrajaya Johor Pulau Pinang Perak Negeri Sembilan Melaka Kedah Pahang Terengganu Kelantan Perlis Sabah W.P Labuan Sarawak
5,160 34,458 48 13,476 7,682 7,078 4,747 4,140 3,190 3,313 716 458 165 4,266 605 4,227
35 2,792 35 789 237 428 1,286 263 58 332 11 80 19 1,013 0 447
MALAYSIA
93,729
7,825
p = preliminary
Source: Industrial Property Stock Report, 3rd Quarter 2011 by Valuation & Property Services Department.
MALAYSIA BALANCE OF TRADE Trade Balance RM million
Import/Export RM million
190,000
800,000
170,000
700,000
150,000
600,000
130,000
500,000
110,000
400,000
90,000 70,000
300,000
50,000
200,000 00 01 02 03 04 05 06 07 08 09 10 11*12** Trade Balance Import (RM million) Export (RM million)
Year
Exports
Imports
(RM mil)
(RM mil)
Trade Balance (RM mil)
2000 2001
374,033 334,326
294,889 264,472
79,144 69,854
2002 2003 2004 2005
358,504 397,969 481,903 539,420
286,387 300,207 377,129 410,529
72,117 97,762 104,774 128,892
2006 2007
590,018 605,175
452,726 475,687
137,292 129,488
2008 2009 2010
663,875 554,067 640,043
492,076 412,322 505,317
171,799 141,745 134,726
2011*
682,707
543,025
139,682
2012**
723,968
581,248
142,721
Note: * Estimate ** Forecast Source: Economic Report 2011/2012, Ministry of Finance, Malaysia
CONSUMER PRICE INDEX % Change in CPI 6.0 5.0 4.0 3.0 2.0 1.0
Year
Year
CPI
% Change
2000
80.4
1.5 %
2001
81.5
1.4 %
2002
83.0
1.8 %
2003
83.9
1.2 %
2004
85.1
1.5 %
2005
87.7
3.0 %
2006
90.9
3.5 %
2007
92.7
2.0 %
2008
97.8
5.5 %
2009
98.3
0.6 %
2010
100.0
1.7 %
2011*
103.1
3.1 %
Note: Year 2010 is the Base Year * Average from January to November 2011 only Source: Department of Statistics, Malaysia
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0.0
INTEREST RATES: BANKING INSTITUTIONS Percent Per Annum 9.00 8.00 7.00 6.00 5.00 4.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Commercial Banks : Base Lending Rates Commercial Banks : Average Lending Rates Investment Banks : Average Lending Rates
Commercial Banks Base Lending Rates (%)
Average Lending Rates (%)
Investment Banks Average Lending Rates (%)
Jan Feb
6.27 6.27
5.10 5.07
7.27 7.20
Mar Apr May
6.27 6.27 6.54
5.06 5.06 5.10
7.19 7.17 7.12
Jun Jul Aug Sep Oct
6.54 6.54 6.54 6.54 6.54
5.07 5.03 5.05 5.05 5.03
7.05 6.91 7.01 6.99 6.95
Nov
6.54
5.06
6.99
2011
Note: December rates are not available at time of publication. Source: Monthly Statistical Bulletin, Central Bank of Malaysia
EXCHANGE RATES as at 1 January 2012
Country
Currency
RM1
US $1
Australia
dollar
0.3082
0.9792
Bahrain
dinar
0.1185
0.3764
Brunei
dollar
0.4028
1.2795
China
rmb
1.9923
6.3290
Egypt
pound
1.8956
6.0221
ecu
0.2428
0.7712
dollar
2.4441
7.7643
India
rupees
16.9353
53.8000
Indonesia
rupiah
2,853.87
9,066.2
Japan
yen
24.1900
76.860
Kenya
shillings
26.3116
83.587
Lebanon
pound
470.149
1,493.6
Malaysia
ringgit
1.0000
3.1706
New Zealand
dollar
0.4046
1.2854
Pakistan
rupee
28.1484
89.422
Philippines
peso
13.7529
43.690
riyal
1.1462
3.6411
Singapore
dollar
0.4080
1.2960
South Africa
rand
2.5307
8.0396
South Korea
won
364.97
1,159.42
Sri Lanka
rupee
35.820
113.792
Thailand
baht
9.7545
30.988
United Arab Emirates
dirham
1.1561
3.6726
United Kingdom
pound
0.2025
0.6432
United States of America
dollar
0.3148
1.0000
Vietnam
dong
6,581.2
20,907.1
European Currency Unit Hong Kong
Qatar
Source: www.oanda.com/convert/classic
CURRENCY CHART Ringgit (RM) 8.00 7.50 7.00 6.50 6.00 5.50 5.00 4.50 4.00 3.50 3.00 2.50 2.00 1.50 2001
2002
2003
RM per 1 USD RM per 1 SGD
2004
2005
2006 RM per 1 GBP RM per 1 EURO
2007
2008
2009
2010
RM per 100 JPY RM per 100 PAK
2011 Year
TELEPHONE DIRECTORY (MALAYSIA) Ministries/Departments Department of Statistics Malaysia Department of Town and Country Planning Ministry of Dom. Trade, Co-operatives & Consumerism Ministry of Entrepreneur & Co. Operative Dev. Ministry of Housing and Local Government Ministry of Science, Technology and Innovation Ministry of Works Malaysia Kuala Lumpur City Hall (DBKL) Penang Island Municipal Council Perbadanan Putrajaya Petaling Jaya City Council (MBPJ) Shah Alam City Council (MBSA) Subang Jaya Municipal Council (MPSJ) Public Works Department Malaysia (JKR) SIRIM Berhad The Malaysia Highway Authority
03-8885 7000 03-2698 9211 03-8882 5500 03-8880 5000 03-8891 5000 03-8885 8000 03-2711 1100 03-2617 9000 04- 259 2020 03-8887 7000 03-7956 3544 03-5510 5133 03-8026 3131 03-2691 9011 03-5544 6000 03-8737 3000
Contractor’s Association Master Builders Association Malaysia Contractor’s Registration Board
03-7984 8636
Construction Industry Development Board Professional Registration Boards
03-2617 0200
Board of Architects Malaysia Board of Engineers Malaysia Board of Quantity Surveyors Malaysia
03-2698 2878 03-2696 7095 03-2696 7999
Professional Bodies Assoc. of Consulting Engineers Malaysia (ACEM) Malaysia Institute of Architects (PAM) Malaysian Institute of Planners (MIP) The Institution of Engineers Malaysia (IEM) The Institution of Surveyors Malaysia (ISM) Other Important Numbers
03-2095 0031 03-2693 4182 03-7877 0636 03-7968 4001 03-7955 3333
Ambulance & Police Civil Defence (Rescue) Fire Fighter General Hospital KL Bursa Malaysia SYABAS Sdn Bhd Tenaga Nasional (KL)
999 999 999 03-2615 5555 03-2034 7000 03-2088 5400 03-2296 5566
About Us Davis Langdon & Seah Pakistan (Private) Limited (DLSPK) was established in Karachi in late 2007, spearheading a field relatively unheard of in Pakistan - Quantity surveying and cost management. Being pioneers, DLSPK is partly responsible assist in the building of a strong group of qualified field professionals for years to come. Hence, the publication of the DLS Construction Cost Handbook Pakistan 2009 providing an extensive database for accurate assessment in cost management and quality Quantity Surveying services. This is our second edition, published with technical support from DLS Malaysia, our partner in the proud network that is DLS International with a total of 105 offices and 5,000 staff worldwide. Focusing on Pakistan’s construction cost profiles as well as the major cities in Asia; this handbook serves as general reference on construction cost indicators for project budgeting, appraisals and costing purposes. The information within was compiled by DLSPK. Actual unit prices may vary project to project, depending upon the nature of work, quantum, location and prevalent economic conditions. For further information and/or advice relating to particular project, please contact us at the address provided at the end of this handbook. DLSI has been involved in the publication of construction costs handbooks for countries including Malaysia, Hong Kong, Philippines, Vietnam and Singapore; and is also the editor of the Spon’s Price Book Series. Global Reach .... Local Delivery
Davis Langdon & Seah Pakistan (Private) Limited Quantity Surveyors & Construction Cost Consultants
Industry Overview Housing and construction has been identified as one of the four priority sectors for growth and poverty alleviation for two reasons: one, because it is labor intensive, and two because it has backward and forward linkages with at least 40 other industries. The housing situation in Pakistan has steadily deteriorated over the past many years for a variety of reasons including ineffective policies, resulting in huge housing backlog. According to the last census held in 1998, the total number of housing units throughout the countries was 19.3 million. The housing backlog, as estimated according to the census, was 4.30 million units which then projected in 2004 to 6.0 million units. The annual additional requirements is estimated at 570,000 housing units whereas the annual production is estimated at 300,000 housing units, resulting in a recurring shortfall of 270,000 housing units annually. It is estimated that in order to address the backlog and to meet the housing shortfall in the next 20 years the overall housing production will have to be increased to 820,000 housing units annually. Recognizing the gravity of the situation and realizing the potentials of housing and construction as productive sector of the economy, the present government has declared Housing and Construction as priority industry and also formulated a pragmatic and workable National Housing Policy with a view to: a) Accelerate housing activity and contribute towards employment generation and economic development b) Facilitate provisions of housing inputs including land, finance and building materials, institutional and legal framework c) Analyse the culture of poverty and the forces generating ever increasing slums and squatters including political, public, socioeconomic, bureaucratic and environmental forces d) Promote ways and means for housing development by enhancing affordability, saving capacity, human tendencies and potential e) Provide safeguards against malpractices, bureaucratic inefficien-cies, institutional weaknesses, and f) Particularly for low income groups The Pakistan Housing Authority (PHA) has been entrusted to spearhead the construction of thousands of apartments for low income groups. The followings are some of the measures initiated under the “Housing for ALL” programme: a) Housing schemes for Government employees launched in all districts of the country for which the provincial governments and ICT will provide (100) acres of State land at affordable price b) Housing schemes for Government employees to be developed on public private partnership basis in which Banks will participate through appropriate collaboration with the private sector developers. Such partnership shall be secured on competitive basis through a transparent selection process
c) Federal/ Provincial/ District Government shall facilitate and provide all necessary support to Banks/Developers with a view to creating enabling environment d) Federal Government will ensure the provision of trunk infrastruc-ture at the project sites from National Utilities regarding electric-ity, gas and telephone. If required Banks may finance extra cost of such infrastructure e) Federal/ Provincial Government will ensure provision of trunk infrastructure for housing schemes f) Provincial Government will make the necessary legislation, if required, for transfer of state land at realistic/affordable rates for the Government employees housing schemes g) Rationalization of the rate of registration fees, stamp duty and property tax to promote housing sector by the Provincial governments
Selection of Design Consultants The professions are regulated by the appropriate professional bodies – Institute of Architects Pakistan (IAP), Institute of Engineers Pakistan (IEP) and Association of Consulting Engineers Pakistan (ACEP), Individual professional consultants have to register with their respective professional boards. Pakistan Engineering Council (PEC) is the regulatory body for engineering works. It is compulsory for all practicising engineers and engineering firms to be registered with PEC. Architects and town planners shall register individually (not as a firm) with Pakistan Council of Architect and Town Planners (PCATP) which is the regulating body for architects and town planners. There is no independent body for quantity surveyors. Quantity surveying works are normally done in house as an integral part of the engineering and/or architectural practices. In the private sector, most consultants are selected and appointed by the developers based on track record and personal relationships besides cost consideration. In the public sector, the selection criteria of project consultants are based on experience, quota, contracts and cost. The consultants must be registered with the various development authorities such as Capital Development Authority Islamabad, Rawalpindi Development Authority, Rawalpindi District Council, Karachi Building Control Authority (KBCA), PHA, PWD, Defence Housing Authorities etc.
Contractual Arrangements In the public sector, there are various forms of contract being used for large tender bids, which are essentially modified FIDIC Forms of Contracts. For smaller projects simple forms of contract are normally used. The Public Works Department usually invites contracting companies to tender through open advertisements in the major newspapers. Sometimes, tenderers are selected through a pre-qualification exercise for larger jobs. For private sector projects the most common procurement method is by selective tendering. In the private sector, the PEC Engineering Forms of contract are widely adopted. Bill of Quantities, drawings and specification are commonly used as the basis for tender. Pakistan Engineering Council produced the following standard bidding/contract documents with modifications based on FIDIC and World Bank formats and specifically tailored to be in line with relevant PEC construction and consultancy Bye laws and Govern-ment of Pakistan requirements:a) Standard form of bidding documents (civil works) – to be used for construction contract over Rs 50 millions b) Standard form of tender documents for procurement of works (electrical and mechanical) – to be used for E&M procurement contract over RS 50 millions. c) Standard form of tender documents for procurement of works (for smaller contracts) – to be used for all type of procurement contract below Rs 50 million. d) Standard form of contracts for engineering consultancy for large projects (Time based/Lump sum assignments) and smaller projects. The documents are applicable to all projects to be executed in Pakistan.
Development Control Presently the functions of development control are contended by several institutions. For instance Karachi Building Control Authority (KBCA), created under the provision of Sindh Building Control Ordinance 1979, is one of the legal valid bodies undertaking this task. KBCA is a regulatory and supervisory body whose prime function is to approval of building plans and “No Objection Certificates (NOC)” etc. and conformation with the existing Building & Town planning regulations. However the quality, soundness and implementation of appropriate design/specifications is the sole responsibility of the concerned professionals licensed by KBCA under Karachi Building Control Licensing Regulations 1982. City District Government (CDGK) has also its own claim under the Sindh Local government Ordinance. Federally controlled and constituted bodies such as Cantonment Board of the Ministry of Defence, Karachi Port Trust, Pakistan Railways, Ministry of Works Pakistan, Board of Revenue, Sindh Katchi Abadies Authorities, Sindh Industrial Trading Estates Karachi have their own jurisdiction which stands untainted from the other local authorities. Similarly other autonomous land owning agencies such as public universities are not controlled by the conventional building control practices. In general all developments must adhere and conform to the Town Planning and Building Control in accordance with Master Plan and Environmental Control (Building and Town Planning Regulations 2002, given cover under Sindh Building Control Ordinance (SBCO) 1979), and the developers/builders must obtain the followings: a) Building Plan approvals and NOCs from the various utilities authorities b) Approval of Structural Designs of Buildings c) Obtaining of NOCs for sale and advertisement for public sale projects i.e. fixation/approval of unit price, time period and specifications of construction and development d) Submission of as built plan upon completion e) Obtaining occupation/completion certificate.
Standards Generally the specifications for construction works are based on the latest edition of Pakistan Standards, British Standards (BS), American Concrete Institute Standards (ACI), American Society for Testing and Materials Standards (ASTM).
Construction Cost Specification For Pakistan The building costs per unit area given are averages incurred by building clients for typical buildings in the urban area as at 4th quarter 2008. They are based upon the total floor area of all storeys measured between external walls and without deduction for internal walls. Approximate estimating costs generally include mechanical and electrical installations but exclude furniture, loose or special equipment, and external works; they also exclude fees for professional services. The cost shown are for specifications and standards appropriate to Karachi and this should be borne in mind when attempting comparisons with similarly described building types in other countries.
Major Rates The unit rates provided are for main work items in a typical construction project in the Karachi area in the 4th quarter 2008. The rates include all necessary labour, materials and equipment. Allowances of 20% to cover preliminary and general items and 20% to cover contractors overheads and profit have been included in the rates which are the normal industry allowances in Karachi. It is customary to induce preliminaries and overheads in the unit rates.
Regional Variations The approximate estimating costs are based on projects in Karachi. Adjust these costs by the following factors to take account of regional variations. - Islamabad: 5 - 10% - Lahore: 0 - 5%
Construction Costs for Pakistan as at 4th Quarter 2008
Cost (Rs/ft2)
Cost (Rs/ft2) RECREATION AND ARTS BUILDINGS
INDUSTRIAL BUILDINGS Factories for letting
1,200 - 1,300
Factories for owner occupation (light industrial use)
Theatres (over 500 seats) incld. seating and stage equipment
1,500 - 1,600
Concert halls incld. seating
70,000 - 75,000/seat
Sports hall incld. changing and social facilities
Factories for owner occupation (heavy industrial use)
1,900 - 2,200
High tech laboratory workshop centers (air conditioned)
Swimming pools (school standard) incld. changing facilities
2,800 - 3,000
National museums incld. full air conditioning and standby generator
ADMINISTRATIVE AND COMMERCIAL BUILDINGS * air conditioned
Civic offices
3,600 3,000,000 each 3,000 - 4,000
RESIDENTIAL BUILDINGS 3,000
Social/economic single family housing
Offices for letting, 5 to 10 storeys
3,200 - 3,500
Offices for letting, high rise
3,500 - 3,700
Private/mass market single family housing 2 storey detached/semi detached
Offices for owner occupation, 5 to 10 storeys
3,800 - 4,000
Terraced houses
Offices for owner occupation, high rise
4,000 - 4,400
Prestige/headquarters office, 5 to 10 storeys
5,900 - 6,100
Prestige/headquarters office, high rise
6,300 - 6,600
Social/economic apartment housing - low rise (no lifts) - high rise (with lifts)
HEALTH AND EDUCATION BUILDINGS General hospitals (excld. specialist equipment and installation)
6,500 - 7,600
Private hospitals (excld. specialist equipment and installation)
7,500 - 8,700
Primary/junior schools
3,300 - 4,000
Secondary/middle schools
3,300 - 4,000
University
2,600 - 3,000
4,900
1,000 - 1,200 1,400 2,300 - 3,000 1,300 1,500
Private sector apartment building - standard specification - luxury
3,300 - 3,700 5,500 - 6,300
Student/nurses halls of residence
1,800 - 2,000
Homes for the elderly - shared - self contained with shared communal facilities
1,300 - 1,500 1,500 - 1,700
Hotel - 5 star, city center - 3 star, city/provincial Motel
11,000 - 13,000 7,000 - 8,800 3,100 - 3,700
Major Rates for Pakistan (as at 4th Quarter 2008)
Unit
Rate Rs
Excavation Mechanical excavation of foundation trenches Hardcore filling (sand) making up levels Hardcore filling (stone) making up levels
m3 m3 m3
425 825 1,170
Reinforcement Reinforcement in concrete walls, suspended concrete slabs Fabric reinforcement in concrete beds
tonne 80,000 m2 240 - 405
Steelworks Fabricate, supply and erect steel framed structure Framed structural steelwork in universal joist sections Structural steelwork lattice roof trusses
tonne
165,000
tonne tonne
165,000 165,000
Plumbing UPVC Half round eaves gutter (6” Dia.) UPVC rainwater pipes (4” Dia.) Light gauge copper cold water tubing (1/2” Dia.)
m m
4,300 2,300
m
595
m
1,235
m m
315 1,150
White vitreous china WC suite
each
14,500
White vitreous china lavatory basin Stainless steel single bowl sink and double drainer
each
8,500
each
11,700
m
1,900
High pressure plastic pipes for cold water supply (2”Dia) Low pressure plastic pipes for cold water distribution (3/4” Dia.) UPVC soil and vent pipes (3” or 4” Dia.)
Electrical Work PVC insulated and copper sheathed cable
Unit
Rate Rs
Preservative treated sawn softwood, size 50 x 100mm
m3
106,000
Single glazed casement window in hardwood, size 650 x 900mm
each
7,300
Two panel glazed door in hardwood , size 850 x 2000mm
each
14,000
Solid core half hour fire resisting hardwood internal flush doors, size 800 x 2000mm
each
15,000
Aluminium double glazed window, size 1200 x 1200m
each 14,400 - 15,200
Aluminium double glazed door, size 850 x 2100mm
each 15,500 - 17,500
Wood and metalwork
Hardwood skirtings
m
500 - 535
2 coats gypsum based plaster on concrete walls 20mm thick
m2
500
White glazed tiles on plaster walls
m2
1,290 - 1,395
Red clay quarry tiles on concrete floors
m2
900
Cement and sand screed to concrete floors, 30mm thick
m2
345 - 376
Mineral fibre tiles on concealed suspension system
m2
950
m2
600 - 700
Precast hollow concrete block walls
m2
1,130
Solid (perforated) common bricks
m2
810
Facing bricks
m2
1,350
Finishings
Glazing 6mm clear float glass; glazing to wood
Brickwork and blockwork
Concrete work
13 amp unswitched socket outlet
each
490
Plain insitu concrete (C25)
m3
6,400 - 7,745
Flush mounted 20 amp, 1 way light switch
each
350
Reinforced insitu concrete (C35)
m3
7,200 - 8,715
m2
270 - 325
Roofing Plain clay roof tiles 260 x 160mm
m2
740
Sawn softwood roof boarding (12mm)
m2
1,410
Bitumen based mastic asphalt roof covering
m2
450
Troughed galvanized steel roof cladding
m2 650 - 800
Painting Emulsion on plaster walls
m2 215 - 235
Oil paint on timber
m2 215 - 235
Formwork Softwood formwork to concrete works, concrete columns, horizontal soffits of slabs
Basic Cost of Key Materials in Pakistan (as at 4th Quarter 2008)
Unit
Cost Rs
CEMENT & AGGREGATE
Ordinary portland cement in 50kg bags tonne 6,740 825 Coarse aggregates for concrete (3/4” down) m3 3 Fine aggregates for concrete (Local Sand) m 670 Ready mixed concrete (in SR Cement) 4,400 - 1000 psi m3 3 5,400 - 3000 psi m - 3750 psi m3 5,800 6,360 - 4500 psi m3 3 7,055 - 6000 psi m 3 - 7000 psi m 8,200 3 11,000 - 9000 psi m Ready mixed concrete (in SR Cement) is on average Rs 125/m3 higher.
Unit CERAMIC TILES, STONE & MARBLE (Avg. Rate) Prime Quality Ceramic Floor & Wall Tiles - Local - China
m2 m2
450 - 550 450 - 850
Prime Quality Porcelain Floor & Wall Tiles (UAE)
m2
950 - 1,450
Polished Finish Verona Marble (Local 18mm thk)
m2
2,800 - 3,000
Polished Finish Granite (White) Flamed Finish Granite (White)
m2 m2
6,800 7,300
litre litre litre litre m2
255 150 300 300 645
m2 pc
410 220
m2 pc m2
1,000 110 550
PLASTER & PAINT
Plain steel reinforcement 10mm - 40mm dia. tonne 70,000 - 71,000 Cold-worked deformed Steel Bars, tonne 80,000 - 81,000 10mm - 40mm dia. Structural steel sections tonne 85,000 - 95,000
Plastic Emulsion paint (Matt) Distemper Paint Enamel Paint (Matt) Paint for External surface Colour crete plaster for external surface
BRICKS & BLOCKS
CEMENT TILES & PAVERS
STEEL
Hollow concrete blocks - 1200 psi (150 x 200 x 305mm) - 1200 psi (100 x 200 x 305mm) - 2000 psi (150 x 200 x 305mm) Solid concrete blocks - 1200 psi (150 x 200 x 305mm) - 1200 psi (100 x 200 x 305mm) - 3000 psi (150 x 200 x 305mm) Hollow concrete fairface blocks - 1050 psi (190 x 190 x 390mm) - 1050 psi (140 x 190 x 390mm) - 1050 psi ( 90 x 190 x 390mm) Solid concrete fairface blocks - 1050 psi (190 x 190 x 390mm) - 1050 psi (140 x 190 x 390mm) - 1050 psi ( 90 x 190 x 390mm)
TIMBER & INSULATION
Softwood sections for Formwork Hardwood for joinery (Deodar Wood) Teak plywood (Prime) Commercial plywood for joinery Formica ply sheets (Local) 100mm thick foam insulation (Jumbolon)
pc pc pc
19 17 58
pc pc pc
25 23 80
pc pc pc
38 29 23
pc pc pc
50 40 30
m3 m3 m3 m2 m2 m2
26,500 113,000 520 500 390 1,300
Cost Rs
Clay floor tiles (200 x 200mm) Kerb Stone (150 x 300 x 450) (Local) Precast concrete paving slabs (300 x 300 x 60mm) Clay roof tiles (400 x 225mm) Precast concrete roof tiles DRAINAGE
WC suite complete each 10,000 - 14,000 Lavatory basin complete each 70,000 - 80,000 100mm diameter UPVC drain pipes (Class D) m 755 150mm diameter UPVC drain pipes (Class D) m 1,635
The figures above are the cost of main construction materials, delivered to site in the urban area, as incurred by contractors in the 4th quarter 2008. These asume that the materials would be in quantities as required for a medium sized construction project and that the location of the works would be neither constrained nor remote. All estimated amounts are rounded to nearest Rs. 50.00 - 100.00
Wages of Key Personnel in Pakistan Wage rate Rs/day
CATEGORY OF WORKERS Mason/bricklayer
600.00
Carpenter
575.00
Plumber
550.00
Electrician
500.00
Aluminium Technician
500.00
Welder
550.00
Painter
500.00
Crane Operator
550.00
Pipe Fitter
500.00
Skilled Workers
600.00
Semi-Skilled Workers
450.00
Unskilled Workers
350.00 Wage rate Rs/hour
CATEGORY OF WORKERS Foreman Asphalt
75.00
Foreman Concrete
75.00
Foreman Earthwork
70.00
Supervisor
63.00
Site Engineer
125.00
Asphalt Plant Engineer
125.00
Concrete Plant Engineer
125.00
Surveyor
105.00
Assistant Surveyor
85.00
Steel Binder / Cutter
75.00
Note: Rates are as at 4th Quarter 2008 Source: Finance Department, Government of Punjab
Comparison of Daily Wages of Construction Workers in Different Cities Category of workers and cities
2005
2006
2007
2008
Islamabad
400.00
400.00
525.00
575.00
Karachi
365.00
369.00
450.00
575.00
Lahore
338.00
325.00
388.00
507.00
Peshawar
275.00
275.00
375.00
438.00
Quetta
275.00
313.00
500.00
600.00
Islamabad
400.00
400.00
525.00
575.00
Karachi
365.00
369.00
450.00
600.00
Lahore
380.00
396.00
491.00
557.00
Peshawar
325.00
325.00
442.00
475.00
Quetta
275.00
313.00
450.00
600.00
Carpenter
Mason (Raj)
Labourer (Unskilled) Islamabad
200.00
200.00
275.00
300.00
Karachi
230.00
230.00
300.00
350.00
Lahore
200.00
213.00
250.00
300.00
Peshawar
150.00
150.00
200.00
225.00
Quetta
170.00
200.00
300.00
300.00
Note: Data pertains to month of November each year (in Pak Rupees) Source: Federal Bureau of Statistics, Pakistan
Infrastructure Development (A) Roads The total length of roads in Pakistan is approximately 260,000 km. This includes 8,850 km of federalized roads, including twelve National Highway and four Motorways (M-1, M-2, M-3, & M-9). An investment of about Rs. 100 billion is earmarked for improvement of existing roads and construction of new highways and motorways during the 9th five-year plan. Work on the 1,265 km Indus Highway Project has been completed. The Indus Highway, an alternate North-South route on the west bank of river Indus, links Karachi and Peshawar through some less developed areas of the country and reduces the distance between Karachi and Peshawar by 300 km. The work on the dualisation of 1,762 km National Highway (N.5), a historic highway from Karachi to the Torkham border, through Lahore has also been completed. The construction of the Pakistan Motorway systems, connecting the northern and southern parts of the country with a link at Gawadar has been initiated. The first 333 km phase of the project, the Lahore-Islamabad Motorway M-2, has been constructed with the assistance of a South Korean firm at a cost of US$ one billion. The project has been completed now. Along this Motorway, industrial estates of 800 to 1,000 hectares at or near the interchanges are also constructed. The Islamabad-Peshawar Motorway (M-1) has also been completed.
Following are the details of some of the National Highways and Motorways:
Name M-1 M-2 M-3 M-9 N-5
N-10
N-15 N-25 N-35 N-40 N-45
The main Karakoram Highway (N-35), which is the historic silk route, is being improved, with 713 km of the road being rehabilitated under Phase-I by the Frontier Works Organization (FWO) to enhance road safety. Under Phase II, the road has been upgraded to International Standards to eventually allow faster flows of traffic from the sea ports of Karachi and Gawadar to the Central Asian States.
N-50
(B) Ports
N-75
Pakistan has two major operating Ports serving 803,943 square km of hinterland, besides offering services for land-locked Afghani-stan. The Karachi Port has 30 general cargo berths with draft of 10 to 11.5 M, and three oil jetties two of which are capable of handling 75,000 dead weight ton (DWT) ships; the third is being reconstructed to serve 75,000 DWT ships. A dedicated Container Terminal of 600 mt. quay length with draft of 11.3 m is already functioning at the West Section of the Port which is capable of handling 300,000 TEUs per annum and can accommodate 2,7000 TEU ships. The terminal is equipped with three gantry cranes, 6 RTGs and has an area of 136,000 sq. m. with a holding capacity of 8,570 TEUs. Berths 6-9 have been reconstructed and will support the establishment of a second Container Terminal at the East Section of the Port. The Port is also equipped with Two Harbor Mobile Container handling cranes that are located at the East Wharf Berths 1-4. The Port handles 18 million tons of cargo including about 7 million tons of liquid cargo. The Port has adequate covered and open transit storage areas for storage of general cargo and containers with effective security and fire fighting systems. The Port also provides buffer storage areas for export cargo, including bulk commodities for export.
N-55 N-65 N-70
Route Peshawar to Islamabad Lahore to Islambad Pindi Bhattian to Faislabad Karachi to Hyderabad Extends from Karachi to Torkham via Hyderabad, Multan, Lahore, Rawalpindi and Peshawar. Lahore Peshawar section is also known as GT or Grand Trunk Extends along the Arabian Sea Coast from Karachi to Gawadar. Also known as Makran Coastal Highway Extends from Mansehra to Chilas via Naran and Jalkhand Extends from Karachi to Quetta. Also known as RCD Highway Extends from Hasan abdal to Khunjerab. Also known as Karakoram Highway Extends from Lakpass to Taftan Extends from Nowshera to Chitral Extends from Kuchlack to Dera Ismail Khan Extends from Kotri to Peshawar. Also known as Indus Highway Extends from Sukkur to Saryab Extends from Qila Saifullah to Multan Extends from Islamabad to Kohala
Kilometers 155 367 53 136 1,819
Specification 6 lanes 6 lanes 4 lanes 4 lanes 4 lanes
653
2 lanes
240
2 lanes
813
2 lanes
806
2 lanes
610
2 lanes
309
2 lanes
531
2 lanes
1,264
4 lanes
385
2 lanes
447
2 lanes
90
2 lanes
Keeping in view the present status of the Port facilities, changes in maritime transport, and future requirements of the trade and commerce sectors, Karachi Port, with the assistance of the World Bank, has formulated and launched a comprehensive Port Modernization Plan to take care of the Traffic for the next 20 years. The other major port, Port Qasim, is located approximately 50 km south-east of Karachi and became fully operational in 1983.The approach to the port is along a 45-kilometre long Navigation Channel which provides safe navigation for vessels up to 75,000 metric tons of DWT. The Port facilities include a 1,400 m multipurpose terminal, divided into seven berths of 200 m each Berths 1-4 can accommodate vessels of up to 25,000 DWT and Berths 5-7 of up to 35,000 DWT. There is also a 279 m special berth for handling bulk iron ore and coal for Pakistan Steel. The berth is connected with the Steel Mill facility through a 4.5 m elevated conveyor. The Port also has one Oil Terminal set up by the private sector for handling liquid bulk cargoes, including fuel oil and petroleum. Port Qasim handles and annual average of 7.2 million tons of cargo, of which about 3 million tons is liquid cargo. The Port of Karachi and Port Qasim, are well served by the road and rail system, linked directly with the National Highways and rail services. Pakistan’s coastlines are over 1962 km long, stretching from Jiwani on the Pakistan-Iranian border at the western limit of the Balochistan coast and ending at the Sir Creek, formed at the Pakistan-India border on the Sindh Coast in the south-east. The coastline fronts the Arabian Sea and is adjacent to the straits of Hormuz and international shipping routes serving the Arabian Gulf region. Various studies have been conducted for potential port sites on the Balochistan Coast and a third major port is currently under construction at Gawadar, which is ideally located to attract traffic including transit and trans-shipment trade to/from the Gulf and CAR Countries. Gawadar Port Gawadar port is located at Gawadar city at the entrance of the Persian Gulf on Arabian Sea and about 460 km west of Karachi in Balochistan. It is strategically located outside the sensitive area of Strait of Hormuz but still remained on main shipping lanes. On its western side lay several hub ports of the Gulf and on eastern side Sri Lanka and Indian ports. It is bounded on the North by Kech and Awaran District and on the East by Lasbela District. These districts are mountainous and provide physical safety to Gawadar port from adverse effects of sea storms. On its south is the Arabia Sea and on West is Iran. Gawadar port is a deep-sea warm water port, being constructed in two phases with heavy investment from China. In 1993, Pakistan started technical and financial feasibilities for the development of Gawadar port. The Gawadar port project started on 22 March 2002 and the Port of Singapore Authority was hired for its management. Gawadar Port became functional on March 15, 2008, when the first ship carrying 60,000 tonnes of wheat docked, unloaded and safely sailed out from the Gawadar Port. Thus, Gawadar Port finally made history by beginning its cargo handling. It was also an important event in the sense that it was the biggest ship that had ever docked at a Pakistani port.
Gawadar Port has depth of 14.5 meters and approach channel of five kilometers. Three multi-purpose berths of 210 meters in width have been built. The port can handle bulk carriers of up to 50,000 DWT through its three berths. The federal government has declared Gawadar port as a free port for the next 20 years. Due to this fact, the Port has boosted business and trade activities at all levels in Pakistan. The second phase of Gawadar port is in progress. Phase II of the project has to be built on BOO/BOT basis at an estimated cost of US$ 524 Million will involve construction of 9 berths on BOT basis including two container berths, one bulk cargo terminal, one grain terminal with capacity to handle vessels up to 100,000 DWT, one roll on/roll off terminal, two oil piers of vessels up to 200,000 DWT and future expansion of two container berths. It is anticipated that the private sector will come forward and participate in completion of Phase II of the project. On completion of the project, Gawadar Deep-sea port would be one of the world’s most strategically located port in this part of the world.
(C) Shipping The Pakistan National Shipping Corporation (PNSC), a public sector organization. Its main objective is to serve as an operating link between major trading partners of the country, maintain and stabilize the freight rates and provide strategic link in case of emergencies. PNSC operates a fleet of 14 vessels with a total dead-weight capacity of 243,749 tonnes and also has its subsidiar-ies. PNSC is also the major carrier of crude oil for the Country. The National Tanker Company (NTC), a subsidiary of PNSC has ensured smooth transportation of about four million tonnes of crude oil for the country annually at the most economical rates, resulting in large savings in foreign exchange. It owns a Tanker having oil carrying capacity of about 80,000 tonnes. The Country’s remaining oil needs are met through chartered tankers on as required basis. The Government has issued 35 licenses to private sector companies, but so far only two companies have started up the Tri-Star Shipping Company with one tanker and the Millwall Shipping Company with only one small vessel. Although there are only two companies under the Pakistan national flag in the private sector, a number of companies are operating under flags of their own convenience. Foreign shipping lines dominate the Pakistan shipping industry. Due to small size and inadequate capacity, the national fleet is presently shipping approximately 10% of the regular cargo and 25% of the liquid bulk cargo.
(D) Air Transport Pakistan is linked to almost all the countries of the world through five international airports at Karachi, Islamabad, Lahore, Peshawar and Quetta. Karachi, the gateway to Asia, has the most modern airport of the country.
For building a strong and dependable air transport infrastructure in Pakistan, which would contribute significantly to improving the region’s logistics, the Government of Pakistan in its new National Aviation Policy has explicitly provided for the construction of new airports in the country on BOT basis. The policy also provides for an increase in private sector participation in the construction of airports. To meet the needs of domestic and international air transport, a number of private airlines have been allowed to operate alongside PIA, the national air carrier. For international operations, conditions will be developed to allow fair and reasonable competi-tion with Pakistani carriers with sufficient encouragement to the foreign airlines to continue to serve Pakistan as much as possible and in the most efficient manner. The policy also provides for selective “open skies” through agreements on the principle of reciprocity and bilateralism with the maximum number of countries. Pakistan has concluded Air Services Agreement with 91 countries. As per the new National Aviation Policy of Pakistan, a number of airlines have been granted access to the northern gateway of Pakistan, namely Lahore, Islamabad and Peshawar, effective 1st January 1999. The national airline, Pakistan International Airlines (PIA) now operates services to 45 cities in 36 countries across the four continents. It also serves over 35 cities within Pakistan. The aviation liberalization policy has also opened up investment opportunities in the privatization of airports. This will ease the burden on Civil Aviation Authority that already has enormous airport development plans and projects besides on going maintenance and upgrading of airports. Overall, the deregulation of air transport has resulted in phenom-enal growth of the sector, with domestic passenger traffic increas-ing tremendously. On the major trunk routes, in particular Karachi-Islamabad and Karachi-Lahore, lower fares have contributed to the rapid growth. In recent years, private airlines in Pakistan have flourished. Presently two private airlines, namely: Air Blue and Shaheen Air International are operating on domestic/international routes. New entrants are expected to enter the aviation market. 35 international airlines operate to Pakistan and there has been a tremendous growth on the cargo side, where the Government’s “open skies” policy for exclusive cargo flights is creating growth in this activity. In particular, with the opening of CIS states, charter operations have also increased. There is a Duty Free Shop located in the Jinnah Terminal Complex, Karachi Airport. The Duty Free Shop covers an area of 16,000 sq. ft. All outlets of Aer Rianta are in operation and their shops are full stocked and operational on a 24-hours basis.
(E) Railways Pakistan Railways has a well-developed system connecting virtually the entire country from north to south and east to west, catering to the large-scale movement of freight as well as passen-ger traffic. The Pakistan Railways Network comprises of the following: PLANT AND EQUIPMENT
UNIT
2005 - 2006
R o u te
Km
7 ,7 9 1 .0 0
7 ,7 9 1 .0 0
T ra c k
Km
1 1 ,5 1 5 .0 0
1 1 ,6 1 6 .0 0
Locomotives
No
544.00
544.00
Coaching Vehicles
No
1,663.00
1,670.00
Other Coaching Vehicles
No
214.00
246.00
Freight Wagons
No
20,809.00
19,638.00
Railway Stations
No
626.00
589.00
Passengers Carried
No
81.4 million
83.9 million
The Government of Pakistan is actively encouraging private sector participation in the railway sector to operate passenger and freight trains paying track access charges.
(F) Export Processing Zones (EPZ) The Government of Pakistan has adopted a policy package for the development of EPZs to energize the process of efficient industrial-ization and development with adequate attraction for locals and foreign investment for export oriented business ventures. There are presently four notified EPZs viz. Karachi, Sialkot, Saindak, and Risalpur and many new zones are being set up i.e. Duddar, Gujranwala, Reko Diq, Tuwarqi, Gawadar, Khalifa coastal etc.
2006 - 2007
Construction Output Benefiting from both public and private investments, the construc-tion industry of Pakistan is a prime source of employment genera-tion offering job opportunities to millions of unskilled, semi-skilled and skilled work force. The construction sector was a star performer for the fiscal year 2004-2005, against a sharp downturn of 10.7% in 2003-2004. It recorded an equally sharp upturn of 17.9% in 2006-2007. For 2007-2008, a trend of slow growth was recorded in construction industry curtailed at 15.2 % (recorded in 2007-2008) from 17.9% (recorded in 2006-2007). Hence the industry saw a decline of 2.7% through year 2007-2008. The decline in 2007-2008 was mainly caused by devaluation of Pakistan Rupees and high inflation, which was observed globally. During the last two years, the government has taken various budgetary and non-budgetary measures yielding positive results and thus Construction activity in Pakistan gathered momentum. The budget allocated for construction and transportation was increased from Rs. 6.2 billion (US$ 78.7 million) in fiscal year 2007-2008 to Rs. 6.5 billion (US$ 82.5 million) in fiscal year 20082009. More funds have been allocated to the construction industry for its betterment and growth. The sectoral share in GDP from construction industry increased from 2.5% (in 2006-2007) to 2.7% (in 2007-08). Similarly demand for construction related materials surged. Many national and international real estate developers launched different construction projects in Pakistan during the year 20072008. But after the crash of global economy, Pakistan also suffered loss in all fields as well as in construction industry. Progress in many of the mega projects slowed down or halted. Now the Government as well as private sector is taking all the necessary steps to regain the boost in the industry. The killer earthquake on 8th October 2005 in the Azad Kashmir and North-West Frontier Province (NWFP) region destroyed thousands of medical facilities, schools and residential houses. It is estimated that 2.5 million people were left homeless. It will cost billions of US dollars over the next five to ten years to rebuild the quake-affected areas in Pakistan and Azad Kashmir. Rs million
%
300,000
25.00
250,000
20.00 15.00
200,000
10.00
150,000
5.00
100,000
0.00
50,000 0 -50,000
-5.00 2000 2001 2002 2003 2004 2005 2006 2007 Construction GNP at Constant Factor Cost Construction Sectoral Share in GDP Construction Real GDP/GNP Growth Rate
-10.00 -15.00
Characteristics And Structure In 2008 there were approximately 30,500 registered constructors and 150 operators in Pakistan. Even though the number of labour force in the construction industry had increased, it is still a mere 6.56% from the overall labour force. In Pakistan no engineering works can be constructed except by a constructor, or operated except by an operator licensed as such by Pakistan Engineering Council (PEC). There are six categories of registration, which differ mainly by the limit of construction cost of project to be constructed or capital cost of project to be operated. Number of Employed Labour Force : Overall vs Construction Sector Million 60.00 50.00
Employed Labour Force Construction
40.00 30.00 20.00 10.00
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
-
Minimum Limit of Average annual Largest project Paid up capital requirement of construction value of work value during or net/capital professional cost of project for last 3 years last 3 years worth (million credit points (million rupees) (million rupees) (million rupees) rupees) (pcp-credits) Constructor’s Categories C-1 C-2 C-3 C-4 C-5 C-6
No limit Up to 100 Up to 50 Up to 20 Up to 10 Up to 5
20.00 15.00 5.00 2.00 1.40 0.50
15.00 10.00 3.75 1.50 0.75 0.38
20.00 10.00 2.50 1.00 0.50 0.25
100.00 70.00 40.00 20.00 10.00 5.00
Note: Construction cost of a project shall exclude cost of land, plant and machinery permanently installed in the works but shall include cost of erection, installation, testing and commissioning
Operator’s Categories O-1 O-2 O-3 O-4 O-5 O-6
No limit Up to 50 Up to 20 Up to 8 Up to 4 Up to 2
4.00 3.00 1.00 0.50 0.30 0.10
2.00 1.60 0.80 0.50 0.30 0.20
4.00 3.00 2.00 2.00 1.00 0.50
100.00 70.00 40.00 20.00 10.00 5.00
Note: Capital costs of projects and other values in the above table are based on the value of the operator’s fees.
Clients And Finance Public sector investment makes up a quarter of the total construc-tion investment, and the balance, by the private sector. Most of the building projects are privately funded where the financing is generally arranged through banks. Private funding is increasing due to increased privatisation of the public organizations. However, public funding financed the majority of the civil engineering and infrastructure projects.
Pakistan - An Overview
Pakistan has a strategic location, spread over a landmass of 803,940 square kilometers. Flanked by Iran and landlocked Afghanistan in the West, the central Asian Republics and China in the North and India in the South East, Pakistan boasts of significant location advantage in vast, partially tapped, potential consumer market. The affluent Gulf States are just across the Arabian Sea, providing an additional opportunity of a high consumption market. Pakistan has vast, relatively cheap land for setting up industries and other development. The average office occupation cost in the prime business districts of the big cities at less than US$ 15 per sq feet per year is much lower than other countries in the region. Pakistan is a federation of four provinces and has a parliamentary form of government. The federal government is a bicameral legislature: the lower house, the National Assembly, is elected on adult franchise basis; and the upper house, the Senate, is elected by the provincial legislatures. The provinces - Punjab, Sindh, North West Frontier and Baluchistan have unicameral legislatures with seats of Government at Lahore, Karachi, Peshawar and Quetta respectively.
Key Data GOVERNMENT Official Name Head of State Official Language National language Government type Capital city Administrative divisions
Legal system
: Islamic Republic of Pakistan : President : English /Urdu : Urdu : Federal Republic : Islamabad : 4 provinces, and 1 capital territory; 1) Sindh 2) Punjab 3) Baluchistan 4) North-West Frontier Province and 5) Islamabad Capital Territory : Based on English common law with provisions to accommodate Pakistan as an Islamic State.
GEOGRAPHY Location Total area Cultivated area Forest area Climate
POPULATION
Total population (2008 est.)
: Southern Asia, bordering the Arabian Sea, between India on the East and Afghanistan and Iran on the West and China in the North : Land - 778,720 square kilometers Water - 25,220 square kilometers : 22.99 million hectares : 4.22 million hectares : Four seasons - spring, summer, autumn, winter and monsoons during summer : 165,253,500
Province wise population and % - Sindh : 46,270,980 28.00% - Punjab : 80,974,215 49.00% - Balushidtan : 10,245,717 6.20% - NWFP : 26,440,560 16.00% - Islamabad : 1,322,028 0.80% Ethnic groups : Punjabi, Sindhi, Pastun (Pathan), Baloch, Muhajir Languages : Most of the Pakistanies are tri-lingual. They speak Urdu, English and their regional language. The percentage distribution is as follows: Urdu 95%, English 50% (can communicate) Sindhi 12%, Punjabi 48%, Siraiki 10%, Pastu 8%, Balochi 3%, Hindko 2%, Brahui 1%, Others 8% Population under 15 years Population 15 to 64 years Population 65 years and over Average annual growth rate Median age
: 37.80% : 58.00% : 4.20% : 1.99% : Total 20.5 years Male 20.3 years Female 20.6 years Life expectancy at birth (2008 estimates) - Total population : 64.13 years - Male : 63.07 years - Female : 65.25 years Literacy (Definition: age 15 and over : Total population : 49.90% Male : 63.00% can read and write) Female 36.00% (2005 estimate)
Weighted Average Lending & Deposit Rates % 18.00
LR
DR
Spread
16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 Jun-05 Aug-05 Oct-05 Dec-05 Feb-06 Apr-06 Jun-06 Aug-06 Oct-06 Dec-06 Feb-07 Apr-07 Jun-07 Aug-07 Oct-07 Dec-07 Feb-08 Apr-08 Jun-08 Aug-08 Oct-08
0.00
2007
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
Lending Rates
Deposit Rates
Spread
10.70 10.50 10.60 10.60 10.60 10.30 10.40 10.50 10.50 11.00 10.70 11.00
3.70 3.80 3.90 3.90 4.00 4.00 4.00 4.10 4.10 4.10 4.10 4.10
6.90 6.70 6.60 6.70 6.60 6.30 6.40 6.40 6.40 6.90 6.60 6.90
10.80 10.80 10.90 10.90 11.30 12.80 13.00 13.30 14.40 15.50
4.20 4.20 4.20 4.20 4.20 5.20 5.50 5.60 5.90 6.20
6.60 6.60 6.70 6.70 7.10 7.60 7.50 7.70 8.50 9.30
Source: Statistic Division, Government of Pakistan
Exchange Rates as at 1 January 2009 Country
Currency
Rs1
US $1
Australia
dollar
0.0184
1.4437
Bahrain
dinar
0.0048
0.3780
Brunei
dollar
0.0186
1.4622
China
rmb
0.0874
6.8533
Egypt
pound
0.0718
5.6304
ecu
0.0091
0.7123
dollar
0.0988
7.7508
India
rupees
0.6362
49.900
Indonesia
rupiah
142.934
11,210.8
Japan
yen
1.1533
90.459
Kenya
shillings
1.0014
78.543
Lebanon
pound
19.4799
1,527.9
Malaysia
ringgit
0.0448
3.5146
New Zealand
dollar
0.0220
1.7283
Pakistan
rupee
1.0000
79.066
Philippines
peso
0.6110
47.920
Qatar
riyal
0.0465
3.6488
Russia
rubles
0.3829
30.029
Singapore
dollar
0.0184
1.4391
South Africa
rand
0.1197
9.3903
South Korea
won
16.2707
1,276.16
Thailand
baht
0.4486
35.183
United Arab Emirates
dirham
0.0469
3.6746
United Kingdom
pound
0.0086
0.6811
United States of America
dollar
0.0128
1.0000
European Currency Unit Hong Kong
Source: www.oanda.com/convert/classic
Currency Chart Rupee 160.00 140.00 120.00 100.00 80.00 60.00 40.00 20.00 0.00 99
00
01 Rs per 1 USD Rs per 1 SGD
02
03
04 Rs per 1 GBP Rs per 1 EURO
05
06
07 Rs per 100 JPY Rs per 1 RM
08
Year
POPULATION (cont’d) Population below poverty line Labour force Employed Unemployed Unemployment Rate (2007 est.) Labour force by occupation - Agriculture sector - Construction industry sector - Services sector - Manufacturing and mining - Others Religions
: 24% (2008 estimate) : 50.78 million : 48.07 million : 3.10 million : 7.50% + substantial under employment : 43.62% : 6.56% : 14.41% : 13.54% : 21.86% : Muslim 95% (Sunni 75% , Shi’a 20% ) Christian, Hindu and others 5%
ECONOMY Monetary unit Exchange rate to: (20 Dec 2008) the pound sterling the US dollar Euro UAE Dirham Average annual real inflation Inflation rate (Jul - Nov 2008) GDP growth rate Gross Domestic Product (GDP) at market price GDP per capita (PPP) Average annual real change in GDP GDP composition by sector Remittance (2007 - 2008)
: Pak – Rupee (Rs) : Rs 119.06 : Rs 78.90 : Rs 109.17 : Rs 21.45 : 12.00% : 24.70% : 5.78% : US$ 167.00 billion : US$ 2,400.00 : 5.87% : Agriculture 20.90%, Services 53.20%, Construction Industry 2.70%, Manufacturing 18.90%, Others 4.40% : US$6.45 billion (+17.5%)
TRADES Total Exports (2007 - 2008) Major exports commodities
: US$20.13 billion : Textiles, rice, leather goods, sports goods, chemicals, manufactures, carpets and rugs Export partners (Jul 08 - Aug 08): USA 18.41%, UAE 8.85%, Afghanistan 8.16%, , China 3.96%, UK 4.89% Imports (2007 - 2008) : US$35.41 billion Imports commodities : Petroleum and petroleum products, machinery, chemicals, transportation equipment, edible oils, pulses, iron and steel, tea Import partners : UAE, Saudi Arabia, Kuwait, USA, Malaysia International Airports : Karachi, Lahore, Islamabad, Peshawar and Quetta Major Sea ports : International -Karachi, Port Bin Qassim : Domestic - Minora, Gawadar and Pasni
CONSTRUCTION Net Value of construction output as a proportion of GDP GNP at Current Factor Cost
: 2.70% : Rs 277,141 m
Construction sector growth : 15.20% Net Inflow of FDI (Construction) : US$ 88.5 million (2007 - 2008) US$ 18.1 million (2008 - 2009) Cement production (2008) : 8.75 million tonnes
Economy Pakistan’s economy continues to show resilience to domestic and international shocks of extraordinary nature during the out going fiscal year. Although these have taken their toll, the economy is expected to turn in a reasonable growth performance during fiscal year 2008-2009, albeit substantially lower than target. However, growing macroeconomic imbalances, particularly the widening fiscal and current account deficits continued to create complications and add to inflationary pressures. On the other hand, Pakistan has largely been less affected by the continuing turmoil in the international credit markets. Pakistan’s economy has grown at an average rate of almost 6.6% per annum during the last five years. Its GDP grew by 5.8% in 2007-2008 against 6.8% last year and growth target of 7.2%. Agriculture sector showed dismal performance and grew by 1.5% against 3.7% last year and target of 4.8%. Manufacturing, account-ing for 18.9% of GDP registered a modest growth of 5.4% against 8.2% last year. Agriculture remains the dominant source of employ-ment. The share of agriculture in employment increased from 43% in 2003-2004 to 43.61% by the year 20062007, with manufactur-ing (13.54%) and trade(14.43%) & services(14.41%) absorbing a growing share of the work force. Pakistan’s export performance has been impressive in recent years (2002-2003 to 2005-2006) with exports registering an average growth of 16 percent per annum. Pakistan’s export performance was however dismal in 2006-2007, witnessing abrupt and sharp deceleration to less than 4 percent. The SBP continued pursuing a relatively easy monetary policy since 2002 to induce banks to reduce the lending rates in order to providing low cost credit to private sector with the view of promoting investment and growth. However, with recent monetary devaluation, rising fuel prices and its global effects, SBP has increased the lending rates to 15% effective 4th Quarter 2008.
Comparative Performance of Key Economic Indicators Unit GDP Growth % Weighted Ave. Lending Rates % Construction Growth % Inflation % Exchange Rate Rs/US$ Stock exchange index (KSE) FDI US$ millions
2003-4
2004-5
2005-6
2006-7
2007-8
7.50 8.60 6.60 7.00 5.80 5.05 8.00 9.60 10.68 12.02 -10.70 18.60 5.70 17.90 15.20 3.90 9.30 7.90 7.90 12.00 57.92 59.66 60.00 60.91 78.90 5,279 7,450 9,989 9,801 12,289 949.40 1,524.00 3,521.00 4,160.00 5,152.00
Investment Policies And Incentives The current Pakistan Government has adopted the following liberal investment policy: All economic sectors open to FDI Equal treatment to local and foreign investors 100% foreign equity allowed No government sanction required Attractive tax/tariff incentives package Remittance of royalty, technical and franchise fee, capital, profits and dividends allowed Foreign investment fully protected by Foreign Private Investment (Promotion & Protection) Act 1976, Protection of Economic Reforms Act, 1992 and Foreign Currency Accounts (Protection) Ordinance, 2001 Bilateral Agreements - Investment protection with 46 countries and Avoidance of Double Taxation with 52 countries Non Manufacturing Sectors Policy Parameters
Manufacturing Sector
Agriculture
Infrastructure IT & Telecom Services & Social Social
Not required except for 4 specific industries i.e. arms and ammunitions, high explosives, radioactive substances and security printing currency and mint
Not required except specific licenses from concerned agencies
Remittance of capital, profits, dividends, etc
Allowed
Allowed
Upper limit of foreign equity allowed
100%
Minimum investment amount
No
Government Permission
Custom duty on import of Plant, Machinery and Equipment
5%
Tax relief (Initial depreciation allowance, % of Plant, Machinery and Equipment)
50%
Royalty & Technical Fee
No restriction for payment of royalty & technical fee
100% USD 0.3m 0%
100%
100%
USD 0.3m
USD 0.15m
5%
0-5%
50% Allowed as per guidelines – initial lump sum up to USD100,000 -Max rate 5% of net sales – initial period 5 years
The housing and construction sector was declared as industry in 1994. Plant, Machine and Equipment, not manufactured locally, of housing and construction industry are importable at custom duty of 5.0% and Zero rates sales tax. To encourage investment in this sector, excise duty on paints was abolished, and import duties on a number of building materials, including steel and its products and construction machinery reduced. Sales tax and withholding tax on construction machinery were also abolished.
The Government is undertaking a major effort to remove ambigui-ties in urban land titles, to provide certainties in the real estate market. Local and foreign companies involved in real estate projects will only market those whereby the property title is transferred in the name of a locally incorporated company, and the “Commencement of Business” certificate issued by the Security & Exchange Commission of Pakistan to the firm. Plant, Machine and Equipment - not manufactured locally - of tourism, hotels and related projects are also importable at custom duty of 5.0% and Zero rates sales tax.
Tariff Manufacturing/Industrial Sector
Custom duty levied on imports of plant, machinery and equipment
Custom duty
Sales tax
5.00%
0.00%
0.00 - 5.00%
0.00%
Other Sectors (Non Manufacturing)
Imported of plant, machinery and equipment (not manufactured locally)
Fiscal Incentives To keep Pakistan competitive in international markets and support the viability of investments in the country, the following incentives are available to both foreign and local investors.
Personal Income Tax Rates Salaried Taxpayers
A) Initial Depreciation Allowance (IDA)
Up to Rs. 180,000
0.00
Rs. 180,001 - 200,000
0.50
Rs. 200,001 - 250,000
0.50
Rs. 250,001 - 350,000
0.75
Rs. 350,001 - 400,000
1.50
Rs. 400,001 - 450,000
2.50
Rs. 450,001 - 550,000
3.50
Rs. 550,001 - 650,000
4.50
Rs. 650,001 - 750,000
6.00
Rs. 750,001 - 900,000
7.50
Rs. 900,001 - 1,050,000
9.00
IDA at rate of 50% is permissible on an “eligible depreciable asset” placed in service in Pakistan for the first time in a tax year. “Eligible depreciable asset” means plant and machinery excluding any road transport vehicle unless the vehicle is plying for hire; any furniture including fittings; any plant or machinery that is required second hand; and any plant or machinery in relation to which the deduction has been allowed under other section of the New Ordinance for the entire cost of the asset in the tax year in which the asset is acquired. B) Amortization 1) Amortization of pre-commencement expenses allowed at the rate of 20% annually
Taxable Income
Rate of Tax (%)
Rs. 1,050,001 - 1,200,000
10.00
Rs. 1,200,001 - 1,450,000
11.00
2) Amortization of intangible assets allowed over a period of ten year.
Rs. 1,450,001 - 1,700,000
12.50
Rs. 1,700,001 - 1,950,000
14.00
Normal Tax Rates
Rs. 1,950,001 - 2,250,000
15.00
Rs. 2,250,001 - 2,850,000
16.00
Rs. 2,850,001 - 3,550,000
17.50
Rs. 3,550,001 - 4,550,000
18.50
Rs. 4,550,001 - 8,650,000
19.00
Over Rs. 8,650,000
20.00
Company Tax Rates Banking Companies Public Companies Private Companies Small Companies having: 1) Paid up capital of Rs 25 mil 2) Turnover of Rs 200 mil 3) Incorporated after July 1, 2005 Private Companies Source: Central Board of Revenue, Pakistan
Tax Rate 35% 35% 35% 20%
Non Salaried Taxpayers Taxable Income
25%
Rate of Tax (%)
Up to Rs. 100,000
0.00
Rs. 100,000 - 110,000
0.50
Rs. 110,001 - 125,000
1.00
Rs. 125,001 - 150,000
2.00
Rs. 150,001 - 175,000
3.00
Rs. 175,001 - 200,000
4.00
Rs. 200,001 - 300,000
5.00
Rs. 300,001 - 400,000
7.50
Rs. 400,001 - 500,000
10.00
Rs. 500,001 - 600,000
12.50
Rs. 600,001 - 800,000
15.00
Rs. 800,001 - 1,000,000
17.50
Rs. 1,000,001 - 1,300,000
21.00
Over Rs. 1,300,001
25.00
Facilitation Exchange Control a) Full repatriation of capital, capital gains, dividends and profits is allowed. b) The facility for contracting foreign private loans (which does not involve any Guarantee from the Government of Pakistan) is available to all those foreign investors, who make investment sectors open to foreign investment, for financing the cost of imported plant and machinery required for setting up the project. However, loan agreement should be registered/ cleared by the State Bank of Pakistan. c) Foreign controlled manufacturing concerns will be allowed unlimited domestic borrowing according to their requirements for working capital. d) Authorized dealers are authorized to grant rupee loans and credits to foreign controlled companies for meeting their working capital requirements subject to observance of Prudential regulations prescribed under the Banking Companies.
Pakistan Value of Foreign Trade (in million rupee) Year / Month
Exports
2001-02
ReExports
Imports
ReImports
Balance of Trade
560,946.70 4,306.90
634,630.30
688.50
-70,065.20
2002-03
652,293.80 2,943.50
714,371.90
342.00
-59,476.60
2003-04
709,036.10 24,024.80
897,824.60
819.00
-165,582.70
2004-05
854,087.70 6,076.70 1,223,079.10 4,729.10
-367,643.80
2005-06
984,840.60 7,717.00 1,711,158.40
613.70
-719,214.50
2006-07 1,029,311.67 9,726.10 1,851,805.91
232.00
-813,000.23
2007-08 1,196,637.60 45,527.60 2,512,071.70
690.80 -1,270,597.30
2007 Jul
88,878.90
N/A
155,454.10
N/A
N/A
Aug
88,627.20
756.50
166,257.70
30.60
-76,904.50
Sep
90,014.10
527.00 1,658,343.90
26.30
-75,320.10
Oct
83,626.00 1,889.20
205,383.90
24.20
-119,912.90
Nov
93,891.20 25,317.90
192,838.60
44.50
-73,674.00
Dec
80,771.50
833.60
143,699.70
84.40
-62,179.00
2008 Jan
91,319.70
765.40
220,097.10
27.10
-128,039.10
96,314.70 1,053.40
229,052.50
80.60
-131,765.00
Feb Mar
111,168.90
928.30
239,805.00
105.10
-127,812.90
Apr
113,816.00 1,127.10
260,569.70
5.50
-145,632.10
May
129,846.90 1,725.20
262,450.30
104.90
-130,983.10
Jun
128,362.60 9,755.60
270,628.20
94.80
-132,604.80
Jul
132,665.00 1,838.00
250,512.60
73.40
-116,083.00
Aug
116,196.30 1,488.90
257,011.90
174.20
-139,500.90
Source: Statistic Division, Government of Pakistan
Yearly Inflation Rates Inflation Rates based on Sensitive Price Indicator (SPI), Consumer Price Index (CPI) and Wholesale Price Index (WPI)
Period
SPI 12.6
2006-07*
WPI
2004-05
CPI
2000-01
1998-99
1996-97
1994-95
1992-93
1990-91
SPI
2002-03
% 20.00 18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00
CPI
WPI 11.7 9.8
1990-91 1991-92
10.5
12.7 10.6
1992-93
10.7
9.8
7.4
1993-94
11.1
11.3
16.4
1994-95
15.0
13.0
16.0
1995-96
10.7
10.8
11.1
1996-97
12.5
11.8
13.0
1997-98
7.4
7.8
6.6
1998-99
6.4
5.7
6.4
1999-00
1.8
3.6
1.8
2000-01
4.8
4.4
6.2
2001-02
3.4
3.5
2.1
2002-03
3.6
3.1
5.9
2003-04
6.8
4.6
7.9
2004-05
11.6
9.3
6.8
2005-06
7.0
7.9
10.1
2006-07 2007-08
10.8 16.8
7.7 12.0
6.9 16.4
Note: Base Year = 2000-01 Source: Statistic Division, Government of Pakistan
Useful Websites (Pakistan) Board of Investment
www.pakboi.gov.pk
National Reconstruction Bureau
www.nrb.gov.pk
Capital Territory Police Islamabad
www.cybercity-online.net
Central Board of Revenue
www.cbr.gov.pk
Pakistan Agricultural Research Council
www.parc.gov.pk
Chamber of Commerce & Industry - Federation of Pakistan
www.fpcci.gov.pk
- Islamabad
Pakistan Broadcasting Corporation Pakistan Computer Bureau
www.radio.gov.pk www.pcb.gov.pk
www.icci.org.pk
Pakistan Council of Architects & Town Planners
www.pcatp.org.pk
- Karachi
www.karachichamber.com
Pakistan Engineering Council
www.pec.org.pk
- Lahore
www.lcci.org.pk
Pakistan Housing Authority
www.pha.gov.pk
- Sarhad
www.scci.org.pk
www.picic.com
Export Processing Zones Authority Pakistan
Pakistan Industrial Credit & Investment Corporation
www.epza.com.pk
Pakistan International Airline
www.piac.com.pk
Federal Bureau of Statistic
www.statpak.gov.pk
www.un.org.pk
Government of Punjab
www.punjab.gov.pk
Pakistan National Commission for UNESCO
Government of Sindh Ministry of Information Technology
www.sindh.gov.pk
Pakistan National Shipping Corporation
www.pnsc.com.pk
Pakistan Post Office
www.pakpost.gov.pk
Pakistan Railways
www.pakrail.com
Pakistan Software Export Board Pakistan Telecommunication Authority
www.pseb.org.pk www.pta.gov.pk
Pakistan Television Corporation
ptv.com.pk
Pakistan Tourism Development Corporation
www.tourism.gov.pk
Pakistan Trade Office
www.engineeringpakistan.com
Privatization Commission
www.privatisation.gov.pk www.pamco.bz
Institute of Regional Studies
www.moit.gov.pk www.irs.org.pk
Islamic Republic of Pakistan
www.pakistan.gov.pk
Karachi Building Control Authorities Karachi International Container Terminal
www.kbca.gov.pk
Karachi Port Trust
www.kpt.gov.pk
Ministry of Commerce
www.commerce.gov.pk
Ministry of Environment
www.environment.gov.pk
Ministry of Environment, Local Government & Rural Development
www.environment.gov.pk
Punjab Agriculture Marketing, Govt. of Punjab
Ministry of Finance
www.finance.gov.pk
Securities and Exchange Commission of Pakistan
www.secp.gov.pk
Ministry of Foreign Affairs Ministry of Industries & Production
www.mofa.gov.pk
Silakot Chamber of Commerce & Industry
www.home.scci.org.pk
Small & Medium Enterprise Devt. Authority
www.smeda.org
State Bank of Pakistan
www.sbp.org.pk
Trade Development Authority of Pakistan
www.tdap.gov.pk
www.kictl.com
www.moip.gov.pk
Ministry of Petroleum & Natural Resources
www.mpnr.gov.pk
Ministry of Science & Technology
www.most.gov.pk
Competition Commission of Pakistan
www.mca.gov.pk
National Database and Regulation Authority (NADRA)
www.nadra.gov.pk
Quality Policy Statement Our policy and goal is to fill the company’s culture with committed, dedicated and excellent people having in-depth knowledge in the Quantity Surveying field who will play a positive and creative role in realising the needs and expectations of our clients and to continually strive to ensure that our clients have the best service available. Each process within the Company that determines the quality of our services shall be managed and controlled in a planned and systematic manner in accordance with our quality system documents with the highest integrity, impartiality and independency. We see our quality system as a valuable tool and mechanism to promote, instill, further develop and bring about opportunities for improvement to our staff and our internal processes. Essential to an effective quality system is our belief in continuous investment in professional development and structured training of our staff at all levels in core skills and knowledge. All staff members are required to comply with this policy statement, be responsible for the quality of their work and for providing our clients with a consistently high standard of service.
Alan P. Hearn President
VISSION MISSION STATEMENT Davis Langdon and Seah Philippines Inc. Vision To be the leading Cost and Quantity Surveying, Environmental Sustainability and Development Management Consultant in the Philippines built environment providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects - integrating and coordinating each of our business lines. Cost and Quantity Surveying Vision To be the leading Cost and Quantity Surveying Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Cost and Quantity Surveying Consultancy with our other service lines of Environmental Sustainability and Development Management. Mission Protecting the interests of our Clients, we commit to: • Provide our Clients with proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. • Provide our Clients accurate and dependable services taking into account their needs and procurement options.Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Cost Consultancy and Quantity Surveying services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Maintaining and upholding our Chartered status with the RICS. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. • Producing marketing materials and marketing strategy to diversify and widen our client base on Cost Consultancy and Quantity Surveying services. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Environmental Sustainability Vision To be the leading Environmental Sustainability Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Environmental Sustainability Consultancy with our other service lines of Development Management, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide LEED, BERDE and BREAM accreditation consultancy services and expanding this to a capability in other S.E. Asian accreditation systems such as Greenmark (Singapore). • Provide our Clients with a proactive, integrated service guiding them through the accreditation process and educating key parties where there is lack of past experience/familiarization with the process. • Provide our Clients with service over and above their requirements by achieving the project’s targeted sustainability certification, striving to go beyond the project’s pursued level within a reasonable cost and time. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a remuneration package that exceeds the highest local benchmark competitors. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation, specialization seminars and qualifications in the field of environmental sustainability consultancy services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Developing the company as the foremost energy modeling center in the region, well-versed over a range of accredited software; that clients and other DLS companies in S.E. Asia might refer for modeling services. • Expanding our Consultancy Services into other related fields such as carbon assessment, daylight simulation and commissioning works. • Developing our Consultancy Services to increase our involvement in the existing built environment as well as new build developments. • Producing marketing materials and marketing strategy to diversify and widen our Client base on Environmental Sustainability Consultancy. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Development Management Vision To be the leading Development Management Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Development Management Consultancy with our other service lines of Environmental Sustainability, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide a high level Client’s Representative service incorporating strategic procurement advice, project management, planning, risk avoidance and programming services. • Provide our Clients with a proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Guide our Clients through the development process and educating key parties where there is lack of past experience/ familiarization with the process. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Development Management services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Producing marketing materials and marketing strategy to diversify and widen our client base on Development Management services. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
VISSION MISSION STATEMENT Davis Langdon and Seah Philippines Inc. Vision To be the leading Cost and Quantity Surveying, Environmental Sustainability and Development Management Consultant in the Philippines built environment providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects - integrating and coordinating each of our business lines. Cost and Quantity Surveying Vision To be the leading Cost and Quantity Surveying Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Cost and Quantity Surveying Consultancy with our other service lines of Environmental Sustainability and Development Management. Mission Protecting the interests of our Clients, we commit to: • Provide our Clients with proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. • Provide our Clients accurate and dependable services taking into account their needs and procurement options.Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Cost Consultancy and Quantity Surveying services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Maintaining and upholding our Chartered status with the RICS. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. • Producing marketing materials and marketing strategy to diversify and widen our client base on Cost Consultancy and Quantity Surveying services. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Environmental Sustainability Vision To be the leading Environmental Sustainability Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Environmental Sustainability Consultancy with our other service lines of Development Management, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide LEED, BERDE and BREAM accreditation consultancy services and expanding this to a capability in other S.E. Asian accreditation systems such as Greenmark (Singapore). • Provide our Clients with a proactive, integrated service guiding them through the accreditation process and educating key parties where there is lack of past experience/familiarization with the process. • Provide our Clients with service over and above their requirements by achieving the project’s targeted sustainability certification, striving to go beyond the project’s pursued level within a reasonable cost and time. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a remuneration package that exceeds the highest local benchmark competitors. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation, specialization seminars and qualifications in the field of environmental sustainability consultancy services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Developing the company as the foremost energy modeling center in the region, well-versed over a range of accredited software; that clients and other DLS companies in S.E. Asia might refer for modeling services. • Expanding our Consultancy Services into other related fields such as carbon assessment, daylight simulation and commissioning works. • Developing our Consultancy Services to increase our involvement in the existing built environment as well as new build developments. • Producing marketing materials and marketing strategy to diversify and widen our Client base on Environmental Sustainability Consultancy. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
Development Management Vision To be the leading Development Management Consultant in the Philippines built environment, providing the highest level of excellence in professionalism and integrity, working on modern, leading edge projects – integrating and coordinating our Development Management Consultancy with our other service lines of Environmental Sustainability, Cost and Quantity Surveying Consultancy. Mission Protecting the interests of our Clients, we commit to: • Provide a high level Client’s Representative service incorporating strategic procurement advice, project management, planning, risk avoidance and programming services. • Provide our Clients with a proactive, integrated service where we are working on the project covering more than one role. • Establish partnerships with major Clients, working together as an integral part of their management team. • Guide our Clients through the development process and educating key parties where there is lack of past experience/ familiarization with the process. • Provide our Clients with service over and above their requirements through enhanced understanding of their needs. Being the greatest assets of the Company, we commit to the growth and development of our Staff by: • Providing training, an exciting work environment and a competitive remuneration package. • Providing opportunities for career growth and professional development. • Encouraging and providing time and resource to gain external accreditation and qualifications in the field of Development Management services at the earliest time. We commit to continuously protect the interest of our Stockholders by: • Producing marketing materials and marketing strategy to diversify and widen our client base on Development Management services. • Maintaining our Quality Assurance accreditation while being committed to continual improvement. We commit to our responsibility to our Society, hence; • We contribute to socio civic works as a conscientious organization.
CONSTRUCTION COSTS FOR PHILIPPINES PESO/m2 DESCRIPTION
BUILDING
TOTAL SERVICES
TOTAL
DOMESTIC
Average standard apartments, high rise Luxury apartments, high rise Town houses Individual prestige houses
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping Centers
HOTELS
Resort hotels, inclusive of F.F.&E 3-star budget hotels inclusive of F.F.&E 5-star luxury hotels inclusive of F.F.&E
INDUSTRIAL
Owner operated factories, low rise
OTHERS
Carparks, above ground General hospitals
27,100 33,100 21,300 40,700
6,800 9,500 2,700 7,900
- 9,500 - 14,700 - 4,600 - 12,150
-
29,200 34,900 24,700 43,350
22,050 30,750 30,000 -
25,800 32,600 31,800
9,450 - 13,300 13,150 - 16,400 8,100 - 13,400
31,500 - 39,100 43,900 - 49,000 38,100 - 45,200
36,750 35,450 49,750 -
49,050 42,400 51,700
11,350 - 13,950 12,400 - 15,350 14,250 - 22,300
48,100 - 63,000 47,850 - 57,750 64,000 - 74,000
12,300 -
13,850
13,750 36,400 -
17,700 39,600
3,950 -
33,900 42,600 24,000 48,600
-
38,700 49,600 29,300 55,500
6,900
16,250 - 20,750
3,350 - 5,200 12,600 - 20,350
17,100 - 22,900 49,000 - 59,950
Costs are at 4th Quarter 2011 levels. Manila building costs are expected to increase by approximately 0.5% per month (compounded) during 2012.
M & E SERVICES COSTS FOR PHILIPPINES PESO/m2 DESCRIPTION
TOTAL SERVICES
FIRE LIFTS / PLUMBING ELECTRICAL MECHANICAL SERVICES SERVICES ESCALATOR SERVICES SERVICES
DOMESTIC
Average standard apartments, high rise Luxury apartments, high rise Town houses Individual prestige houses
6,800 - 9,500 9,500 - 14,700 2,700 - 4,600 7,900 - 12,150
3,600 3,900 1,400 3,000 -
4,300 400 - 900 6,300 2,100 - 3,000 1,800 600 - 1,300 5,500 2,500 - 2,950
600 - 900 700 - 1,300 -
800 - 1,500 1,400 - 1,900 800 - 1,500 2,000 - 2,600 700 - 1,500 2,400 - 3,700
OFFICE/COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping Centers
9,450 - 13,300 3,300 - 4,700 3,000 - 3,300 13,150 - 16,400 4,800 - 6,000 4,000 - 6,000 8,100 - 13,400 3,600 - 6,000 2,500 - 3,700
650 - 900 1,600 - 2,200 900 - 1,500 650 - 1,200 2,200 - 2,900 1,500 - 2,000 650 - 900 700 - 1,700 650 - 1,100
11,300 - 13,950 4,400 - 5,200 3,000 - 3,300 12,400 - 15,350 4,700 - 5,500 3,300 - 4,000 14,250 - 20,950 5,400 - 8,400 4,000 - 6,000
650 - 950 650 - 950 650 - 1,100
HOTELS
Resort hotel, inclusive of F.F.&E. 3-star budget hotels inclusive of F.F.&E. 5-star luxury hotels inclusive of F.F.&E
1,500 - 2,000 1,800 - 2,500 1,800 - 2,300 2,000 - 2,700 1,800 - 3,000 2,400 - 3,800
INDUSTRIAL
Owner operated factories, low rise
3,900 - 6,650 2,000 - 3,500
650 - 1,300
600 - 900
3,250 - 5,000 1,100 - 1,650 12,600 - 20,150 5,000 - 7,700
100 - 200 4,200 - 6,500
550 - 750 750 - 1,500
-
700 - 1,200
OTHERS
Ccarparks, above ground General hospitals Costs are at 4th Quarter 2011 levels.
1,100 - 1,700 500 - 900 900 - 1,800 1,750 - 3,900
CONSTRUCTION VALUE Construction Value (Php Billions)
120 105 Residential
90
Non-Residential
75 60 45 30 15 0
2002
2003 2004
2005
2006
2007
2008
2009
2010 2011*
Year
Construction Value Php (1,000) Year Residential
2005 2006 2007 2008 2009 2010 2011*
51,454,973 51,179,051 53,596,319 69,043,520 77,953,836 97,247,194 102,938,618
Non-Residential
33,560,552 50,772,217 53,240,552 50,718,172 48,895,248 79,047,539 94,679,492
* Forecast Source : www.census.gov.ph/data/sector data
CONSTRUCTION ACTIVITY Usable Floor Area (Millions m2) 14 12
Residential Non-Residential
10 8 6 4 2 0 2002
2003
2004 2005
2006
2007
2008
2009 2010 2011*
Year
Usable Floor Area (m2) Year Residential
2005 2006 2007 2008 2009 2010 2011*
8,460,337 7,808,050 7,740,142 9,305,281 9,848,587 11,412,345 11,291,568
Non-Residential
5,234,044 6,024,889 7,028,643 6,310,071 5,355,568 8,820,354 8,716,240
* Forecast Source : www.census.gov.ph/data/sector data
LEAD TIME OF DIFFERENT PACKAGES Process Code* (in weeks)
Process Code* (in weeks) Packages
A
B
C
D
Packages
A
B
C
D
Passenger lifts (non-standard)
8
3
-
27
Escalators
4
2
-
18
Mechanical pipework
4
2
1
1
Ductwork
4
2
4
3
Sprinklers
6
2
4
3
2
2
3
6
Insitu Concrete Works
1
Structural steel frames
4
2
-
5
Claddingcurtain walling
10
2
-
14
Brickwork
1
1
2
-
Roof finishes profiled metal
3
1
4
4
Air-conditioning plant
Windows
2
6
Variable airvolume unit
1
1
3
6
Electrical package
6
3
-
-
Switchgear Generators (600 kW)
2
2
-
10
4
2
-
13
Light fittings Security systems
1 3
1 3
6 4
-
Controls
4
3
3
-
Furniture
2
2
4
8
Data and voice cabling
3
2
1
1
2
3
-
Drylining, plaster and screeds
1
1
1
-
Demountable partitions
2
1
2
3
General joinery
2
2
3
5
Raised floors
2
2
-
-
Suspended Decorations (wall coverings) Stone wall and floor finishes
2
2
3
3
-
-
2
-
3
2
4
5
* Process Code Legend: A - Working Drawing B - Approve working drwing C - Procurement of materials D - Manufacture The lead time provided shall serve only as guide for use in projects, this is due mainly to the variability of factors like local customs processing/clearing, material availabilirt, among others. Lead times do not refer to any particular building/project type and are based on average times. For examples; Air-conditioning plant may require between six and twelve weeks depending on the plant specified or required. Therefore, an average of nine weeks has been used in the table.
-
ESTIMATING RULES OF THUMB Densities of Common Materials Concrete Cement Sand Gravel Steel
2,400 kg/m3 1,441 kg/m3 1,600 kg/m3 1,350 kg/m3 7,850 kg/m3
Structure Design - Concrete Ratios
Water Softwood Hardwood Aluminum Soil (compact)
1,000 kg/m3 700 kg/m3 1,100 kg/m3 2,750 kg/m3 2,100 kg/m3
Concrete/floor area Formwork/floor area Reinforcement
0.4 m3/m2 2.0 m2/m2 180 kg/m3
to 0.55 m3/m2 to 3.0 m2/m2 to 280 kg/m3
Average External Wall/Floor Ratio
Concrete
Minimum Recommended Cement Factor Based on Concrete Strength ( in bags of 40 kg cement) Strength Psi Mpa
Ordinary Design Mix 1 1/2” Gravel Size 3/4”
8,000 7,000 6,000 5,000 4,000 3,000
21 19 17 15 11.75 9
55 48 41 35 28 21
22 20 18 16 12.75 10
Pumpcrete Design Gravel Size 3/4” 23 21 19 17 14.5 11.5
Reinforcement
Bar Diameter (mm) 6 8 10 12 16 20 25 32 40
The following is a range of concrete ratios for building superstructure design in Manila:
Weight/m (kg/m)
Perimeter (mm)
Area (mm2)
0.222 0.395 0.616 0.888 1.579 2.466 3.854 6.313 9.864
18.85 25.13 31.42 37.70 50.27 62.83 78.54 100.53 125.66
28.27 50.26 78.54 113.10 201.06 314.16 490.88 804.25 1256.64
Residential Apartments Office, Hotel Industrial
1.0 m2/m2 0.4 m2/m2 0.4 m2/m2
Average Internal Wall/Floor Ratio
Residential Apartments Office Hotel
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
Dimensions for standard parking space, loading/unloading bays and lay-bys
Private Cars, Taxis and Light Vans Coaches and Buses Lorries Container Vehicles
Length (m)
Width (m)
Headroom (m)
5 12 11 16
2.5 3.0 3.5 3.5
2.4 3.8 4.1 4.5
Minimum heandroom means the clearance between the floor and the lower most projection from the ceiling including any lightings units, ventilation duct, conduits or similar. The above ratios are indicative and for reference purpose only. They do not account for buildings with special shapes, configurations or particularly small foot prints. Average Loads
Lorry (24 ton) Concrete truck (24 ton)
Volume
10.0 m 3 5.5 m 3
CONSTRUCTION MATERIALS WHOLESALE PRICE INDEX IN THE NATIONAL CAPITAL REGION (NCR) Base Year (2000 = 100) 2011
2010 Dec
Jan
Feb
Mar
ALL ITEMS
197.0
199.4
201.8
A. Sand and gravel
171.7
171.1
B. Concrete Products
183.8
C. Cement
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
206.6
210.5
210.8
211.4
212.0
211.7
212.3
212.2
213.7
171.4
174.2
178.7
181.8
182.2
184.5
185.8
181.8
182.2
190.0
185.1
186.6
189.7
193.8
194.0
194.8
195.5
195.5
195.9
195.9
195.9
182.9
183.2
183.3
183.7
184.1
178.6
179.2
177.9
176.0
177.9
177.0
177.2
D. Hardware
194.5
195.2
195.2
197.5
201.2
203.9
206.0
205.9
205.8
205.8
205.8
206.5
E. Plywood
157.3
157.9
161.1
165.1
168.8
170.9
171.3
172.3
173.3
172.2
172.2
174.5
F. Lumber
202.3
203.0
204.8
210.7
213.6
217.1
217.1
217.2
216.3
217.2
217.2
218.2
G. G.I. Sheet
172.9
172.9
172.9
173.5
173.6
173.6
173.6
173.6
173.5
173.6
173.6
173.5
H. Reinforcing Steel
220.1
221.1
225.1
230.7
234.4
235.8
238.9
238.9
239.0
238.2
238.2
242.6
I. Structural Steel
246.0
246.2
251.0
253.8
257.4
262.1
264.7
266.8
265.8
266.0
266.0
267.7
J. Tile Works
159.9
160.7
162.4
162.6
163.5
164.4
165.1
166.3
167.5
169.4
169.4
169.4
K. Glass and Glass Products
174.6
174.6
174.6
176.0
177.7
177.7
177.7
177.7
177.7
177.7
177.7
177.7
L. Door, Jambs and Steel Casement
180.6
181.1
184.5
189.3
190.4
190.5
190.5
190.5
190.4
190.4
190.4
191.6
M. Electrical Works
171.3
171.5
174.0
177.2
180.6
183.9
184.0
184.9
185.3
187.1
187.4
187.4
N. Plumbing Fixtures & Accessories/Waterworks
146.9
147.3
148.8
150.0
152.4
154.5
154.5
154.5
154.5
154.5
154.5
154.3
O. Painting Works
185.1
185.8
186.8
189.5
190.4
193.0
193.4
193.6
195.3
195.3
195.5
196.5
P. PVC Pipes
165.3
166.0
166.0
166.8
166.8
168.8
168.8
168.8
169.5
169.5
169.5
170.2
Q. Fuel and Lubricants
290.3
299.3
305.7
326.5
336.5
329.7
325.8
326.4
324.4
326.4
324.2
333.1
R. Asphalt
388.0
388.0
388.0
388.0
388.0
411.3
411.3
431.4
431.4
441.4
441.3
441.4
S. Machine ry and Equipment Rental
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
114.6
Source : www.census.gov.ph/data/sectordata
MINIMUM WAGE Peso per Day
450.00 400.00 350.00 300.00 250.00 200.00 150.00 100.00 50.00 0.00
2001
2004
2006
2008
2011
2010
YEAR
Year
Wage Order #
Amnt. of Increase
Peso per Day
01 January 1991 16 December 1993 01 April 1994 02 February 1996 01 May 1996 06 Febuary 1997 01 May 1997 06 February 1998 31 October 1999 01 November 2000 05 November 2001* 01 Febuary 2002* 25 June 2004* 16 June 2005 11 July 2006 28 August 2007 14 June 2008 28 August 2008 23 June 2010 26 May 2011
NCR 02 NCR 03 NCR 03 NCR 04 NCR 04 NCR 05 NCR 05 NCR 06 NCR 07 NCR 08 NCR 09 NCR 09 NCR 10 NCR 11 NCR 12 NCR 13 NCR 14 NCR 14 NCR 15 NCR 16
12.00 17.00 10.00 16.00 4.00 15.00 5.00 13.00 25.50 26.50 15.00 15.00 20.00 25.00 25.00 12.00 15.00 5.00 22.00 22.00
118.00 135.00 145.00 161.00 165.00 180.00 185.00 198.00 223.50 250.00 265.00 280.00 300.00 325.00 350.00 362.00 377.00 382.00 404.00 426.00
* ECOLA (Emergency Cost of Living Allowance) Source : National Wages & Productivity Council, Department of Labor and Employment
AVERAGE EARNINGS INDEX FOR CONSTRUCTION (1987 = 100) YEAR
2011
2010
2009
2008
2,384.7
2,253.8
2,206.3
2,577.3 2,366.2 2,639.6 2,664.3 2,834.4 2,636.1
2,386.3 2,300.6 2,521.0 2,511.4 2,601.4 2,556.8 2,208.4 2,236.5 2,425.4 2,297.5 2,366.8 2,204.5
2,250.1 2,211.0 2,335.0 2,413.6 2,447.9 2,317.0 2,188.0 2,234.1 2,304.6 2,064.8 2,135.8 2,143.7
2,165.1 2,121.2 2,232.5 2,312.7 2,365.6 2,255.8 2,168.7 2,146.7 2,193.6 2,131.2 2,163.0 2,219.3
2011
2010
2009
2008
2,384.7
2,253.8
2,206.3
2,402.6 2,556.6 2,290.1 2,289.6
2,265.4 2,392.8 2,242.2 2,114.8
2,172.9 2,311.4 2,169.7 2,171.2
ANNUAL January February March April May June July August September October November December
YEAR
QUARTERLY Q1 Q2 Q3 Q4
2,527.7 2,711.6
CONSTRUCTION COST SPECIFICATION The costs for the respective categories given on the previous pages are averages based on fixed price competitive tenders. It must be understood that the actual cost of a building will depend upon the design, procurement methods and many other factors and may vary from the figures shown. The costs per square metre are based on construction floor areas measured to the outside face of the external walls/external perimeter including lift shafts, stairwells, plant rooms, water tanks and the like. All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normal soil conditions and minimal external works. The costs exclude land cost, professional fees, finance and legal expenses. The standards for each category of building vary from country to country and do not necessarily follow those of Manila. FF&E refers to loose furniture, fixtures and equipment. FF&E is excluded from office, residential and retail project costs, but are included in hotels and country club project costs. DOMESTIC Average standard apartments of 6-8 flats per floor, 50m2 - 150 m2 per flat, facade comprising textured paint and punch window, itnernal finishes comprising wood parquet, plaster and paint and painted rubbed concrete to residential units and local ceramic tiles to toilets. Luxury residential facade comprised of window wall, textured paint with stone accents, finished with homogeneous tiles, wood cladding and coved timber ceiling to lobby, combination of wood planks, plaster and paint and gypsum board to residential units and homogenous tiles to toilets. Air conditioning, gensets, automatic sprinkler system, complete plumbing and disposal system, complete fire alarm and detection system, CATV system are allowed for luxury apartments and prestige houses. Services to standard apartment also include for paging system and Davit type gondola.Services to luxury residential also include CCTV cameras on lobby, track mounted type gondola and helipad provision. OFFICE/COMMERCIAL Based on building 30-40 storeys high with floor plans minimum 1,000 m2 per level. Average standard offices and shopping centres have bare finish and exclude A/C ducting and light fittings to tenants areas. Prestige offices have curtain wall elevations, stone finished lobbies
INDUSTRIAL Owner operated factories exclude manufacturing equipment, airconditioning and special services provisions. HOTELS F.F. &E. includes interior decoration and loose furniture, etc. but excludes hotel operator’s items (e.g. cutlery, crockery, linen etc.). Includes 1 level of basement. OTHERS Carparks to be multi-storey, above ground. Schools with standard government provisions. Student hostels to university standard.Hospitals include fit-out to nursing rooms, hospital facilities; services i.e., oxygen piping, A/C, genset, ultrapure water system, fire suppression system and special type plumbing fixtures; fit-out to doctors’ offices is excluded.
RETAIL PRICES OF BASIC CONSTRUCTION MATERIALS FOR PHILIPPINES Cement 240
Ordinary Concrete Hollow Blocks Php / piece
Php / bag (40kg) 15 14
220
13
200
12
180
11 10
160
9
140
8
4" thk
7
120
6" thk
6
100 2007
2008
2009
2010
5
2011
2007
2008
Year
2009
2010
2011
Year
Timber
Aggregates
Php/bdft
Php / m3 1,100
140
1,000
120
900
100
800
80
700 60
600
Sand
500
40
Gravel
400
20
300
0 2007
2008
2009
2010
2011
Softwood Hardwood 2007
Year
2008
2009
2010
2011
Year
Reinforcing Bar (Intermediate Grade - Grade 40; 275 Mpa)
Structural Steel (Angle Bar; A36)
Php/kg
Php/kg
65
75
60
70
55 50 45
65
1/4" x 2" x 20'
60
3/8" x 3" x 20'
16mm
55
32mm
50
40
45
35
40
30
35
25
30 25
20 2007
2008
2009
2010
2011
2007
Year
2008
2009
2010
2011
Year
Reinforcing Bar (High Yield Grade - Grade 60; 10 Mpa)
Structural Steel (Wide Flange)
Php/kg
Php/kg 60
65 60
55
55
14 x 30 lbs
50
50
16mm 32mm
45
45
40
40
35
35
30
30
25 20
25 2007
2008
2009 Year
2010
2011
2007
2008
2009 Year
2010
2011
UNIT COSTS FOR ANCILLARY FACILITIES FOR PHILIPPINES DESCRIPTION
UNIT
SQUASH COURTS
Single court with glass backwall including associated mechanical and electrical services per court but including any public facilities (enclosing structure not included)
DESCRIPTION
PESO
UNIT
PESO
per set
500,000 to 1,500,000
per room
500,000
per room
600,000
PLAYGROUND EQUIPMENT
1,300,000
Outdoor playground equipment comprising various activities and safety mat
1,960,000
SAUNAS
TENNIS COURTS
Single court on grade with acrylic surfacing completed with chain link fence
per court
Single court on grade with artificial turf surfacing including chain link fence
per court
2,400,000
Extra for lighting
per court
500,000
SWIMMING POOLS
Half Olympic (25m x 16m) 6-lanes outdoor swimming pool built in ground, fully tiled, complete with 5m wide deck and associated equipment Half Olympic (25mx 16m) 6-lanes indoor swimming pool with suspended structure (enclosing structure not included) fully tiled and completed with 5m wide deck, including mechanical ventilation and associated equipment.
per pool
7,500,000
STEAM BATHS
Steam bath for 4-6 people complete with all accessories (enclosing structure not included) GOLF COURSES
per pool
11,500,000
Extra for heating equipment
per pool
1,500,000
Extra for salt chlorine generator
per pool
500,000
BASKETBALL COURTS
Exposed court, approximately 975 m2 including
Sauna room for 4-6 people complete with all accessories (enclosing structure not included)
player benches and excluding equipment
per court
3,500,000
Covered court approximately 975m2, including metal viewing seats, built-in furniture, provision for T&B, etc*
per court
18,000,000
(Based on ‘Average Cost Model’ of an 18 hole golf course in Asia) per hole excluding fairway construction and rough hydroseeding
23,000,000
Including fairway construction and rough hydroseeding
per hole
27,000,000
per set
3,000,000 to 4,500,000
GOLF SIMULATOR
Complete golf simulation system complete with projector, high impact projection screen, artificial grass putting turf, putting green cup and control computer with software overall size 4m x7m x 3m high (enclosing structure not included)
* includes provision for forward/rear fold ceiling mounted basketball goal.
M & E MAJOR PLANT COSTS FOR THE PHILIPPINES DESCRIPTION
UNIT
COST (Php)
1. Water cooled electric chiller
per TR
16,000 – 25,000
2. Air-cooled electric chillers
per TR
25,000 – 35,000
3. Cooling Towers; induced draft
per GPM
1,500 – 2,000
4. Air Handling Units (AHU)
per TR
11,000 – 18,000
5. Packaged water-cooled units (PWCU)
per TR
16,000 – 21,000
6. Fire Pumps; electric motor driven
per HP
17,000 – 21,000
7. Fire Pumps; diesel engine driven
per HP
22,000 – 25,000
8. Standby generator sets
per KW
5,500 – 9,000
9. Power transformers, with built-in primary protections; padmount
per KVA
1,600 – 6,000
10. Power transformers, with primary protection; silicon oil filled
per KVA
1,300 – 4,400
11. Power transformers, with primary protection cast resin
per KVA
2,000 – 5,000
12. Sewage Treatment Plant, Sequencing Batch Reactor (SBR); including civil works
per m3/day
20,000 – 30,000
NOTE: 1. Rates are based on direct supply of imported quipment and materials by the developer. 2. Rates include all government imposed taxes, import duties brokerage fees and allowances for local materials and installation cost. 3. Rates exclude preliminaries and contingencies. 4. Rates are based on fixed price tenders received in 4th Quarter 2011.
FIT- OUT COSTS FOR PHILIPPINES DESCRIPTION
PESO/m2
HOTELS 3-star Hotel 4-star Hotel 5-star Hotel
18,000 - 22,000 24,000 - 28,000 30,000 up
Guest rooms : 3-star Hotel 4-star Hotel 5-star Hotel
16,000 - 18,000 20,000 - 25,000 25,000 - 35,000
Notes : 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings.
General dining restaurant Fine dining restaurant
15,000 - 30,000 30,000 up
Note : Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc.). THEATRES / CINEMAS Theatres * Cinemas **
2. Excludes partitioning, M & E works, building shell, chandelier, operational items and equipment (e.g. bed, cutlery, crokery, linen, television, refrigerator, etc.), opening expenses, stage equipment and computer systems. 18,000 - 22,000
1. Mall/Public areas only; tenant area to be bare finish 2. See notes 1,2,& 3 below OFFICES Standard offices * Executive offices ** Banking lobby ***
PESO/m2
RESTAURANT
Public Areas (Front of House) :
COMMERCIAL Shopping centers Notes :
DESCRIPTION
18,000 - 26,000 35,000 - 50,000 55,000 - 65,000
* Medium quality systems furniture ** High quality furnitures and finishes *** Imported stone finishes; double volume spaces Note : See notes 1, 2 & 3 below
NOTE: 1. Costs are at December 2011 Levels. 2. Costs include wall, floor, ceiling finishes, doors, FF&E, M&E Works service reticulation, preliminaries Forex US$1:43 3. Costs exclude operational equipment and supplies, structure, external enclosure, major M&E plant, financing and developers costs, professional and marketing fees.
55,000 - 70,000 30,000 - 45,000
* Includes stage rigging and equipment, draperies, AV equipment projectors, screens, acoustics and seatings ** Includes screens, projection equipment, seats, finishes, ticketing booth AUDITORIUMS
50,000 - 65,000
BUSINESS CLUBS
45,000 - 70,000
BAR / BILLIARDS *
40,000 - 45,000
* Excluding kitchen equipment
KITCHEN EQUIPMENT COSTS FOR PHILIPPINES DESCRIPTION BUSINESS CLUB 500 - 900 m2 floor area EXECUTIVE DINING 200 - 400 m2 floor area
4 STAR HOTEL 50 - 150 rooms 5 STAR HOTEL 200 - 500 rooms
OFFICE CANTEEN 200 - 300 m2 floor area
COST (Php) 15M - 20M
15M - 25M
20M - 30M
30M - 40M
10M - 20M
TRENDS IN CONSTRUCTION COSTS FOR PHILIPPINES Php / m2 (Thousands)
80 Office Bldgs. - Grade A
70
Residential - Luxury Apts. Retail Stores
60
Hotels - 5-star
50 40 30 20 10 0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Year
Building Construction Cost (Php/m2) Hotels
2001 2002
56,160 30,680 57,240 31,270
36,140 36,835
20,800 21,200
52.00 53.00
2003
57,750 31,625
37,125
20,625
55.00
2004
58,800 32,200
36,680
18,840
56.00
2005
58,850 32,175
36,850
19,800
55.00
2006
60,000 34,000
37,000
21,760
50.00
2007
60,200 36,980
37,410
26,500
43.00
2008
66,960 45,120
44,160
29,500
48.00
2009
67,000 45,120
44,180
29,800
47.00
2010 2011
69,080 46,860 68,800 46,400
45,760 46,010
32,340 41,280
44.00 43.00
Office
Residential Retail
US$ to Php
Year
PROPERTY COMMENTARY by Jones Lang LaSalle Leechiu
In General The robust performance of the general property market in 2010, particularly in Metro Manila, had sparked optimism in the market in 2011. This has led property developers to introduce new projects and has encouraged increases in real estate prices. As a result, positive growth in all property sectors (commercial office, residential, hotel, retail and industrial) has been observed. The upward trend in rentals that started in 2010 continued in 2011 as commercial office spaces in Makati, Ortigas and Bonifacio Global City enjoyed healthy demand primarily from the offshoring and outsourcing (O&O) sector. As a result, property developers were encouraged to roll out more new office projects in various areas in Metro Manila. Consequently, the volume of future supply in the next few years has thoroughly increased as compared to the previous year. In 2012, prices are still projected to rise although tightening competition brought on by the large incoming supply may limit their growth. The residential condominium sector has sustained its positive performance in 2011, supported by the remittances from overseas Filipinos and relatively low interest rates. In the coming years, the future stock of residential condominiums is expected to further increase, reaching twice the current stock by 2015. The large incoming supply may lead to an imbalance between demand and supply, which may limit growth in rentals and capital values in the mid-term. The retail sub-sector has also recorded improvements in 2011 as mall developers reported growth in their rental income. Despite the lower domestic economic growth and the fragile state of the global economy, remittance inflows from overseas Filipinos have helped buoy retail spending in the country. Over the next year, the forecast modest economic growth may likely support moderate growth in the retail sector as well. In the coming years, the hotel sub-sector is expected to experience a boom in room supply as new hotels across Metro Manila are completed. Majority of these new hotels will likely be concentrated in Bonifacio Global City and Entertainment City – where most of the upcoming hotels are casino-related. Aside from Metro Manila, many developers are venturing to more leisure resort developments outside Metro Manila. These activities may potentially attract more investments in the hotel sub-sector. The industrial market remained resilient despite experiencing a challenging year as economic externalities affected the performance of the country’s exports. The sub-sector may likely post minimal growth in the near term. However, recovery in the country’s trade and manufacturing industry can propel growth in the industrial sub-sector.
In general, the outlook on the property market for 2012 remains positive, albeit growth may be modest as compared to the relatively high growth experienced in the last couple of years. Amidst the positive sentiments for the market for the year, property players are advised to exercise caution as the global economy continues to be volatile. The slow recovery of the US economy from the last recession in 2009 and the lingering Eurozone debt crisis, are market externalities that threaten to dampen the growth prospects of the property market. Commercial Sector Jones Lang LaSalle Leechiu Research, Consulting & Valuation (“JLLL Research, Consulting & Valuation”) notes that the consolidated office stock for all grades in the established business districts of Makati, Ortigas and Bonifacio Global City stood at approximately 5.46 million sqm in 2011. This represents around 80% of the total stock of office space in Metro Manila (includes the emerging urban districts of Eastwood City, Bay City, Newport City, Alabang and other districts in Quezon City among others). Average vacancy of office developments in Makati CBD and Bonifacio Global City declined from last year’s level to an estimated 4%. In the next four years, approximately 1.06 million sqm are expected to be added to the total office stock in Makati CBD, Ortigas CBD and Bonifacio Global City. In 2012, more than 300,000 sqm of new office space are being constructed. Most of this future supply will come from completions in Bonifacio Global City. After the downturn in the property market experienced in 2009, the office sector recovered in 2010 as rentals began rising again. In 2011, rentals of office developments have continued this upward trend. Average rental rates of prime and Grade ‘A’ offices in Makati and Bonifacio Global City have grown to reach around Php9,100 per sqm per annum from approximately Php7,980 per sqm per annum in the previous year. However, the upcoming supply in 2012, which is more than twice the completions in 2011, may affect the growth in rentals. JLLL Research, Consulting & Valuation estimates that the average achievable gross rental levels for Grade ‘A’ facilities in Makati CBD (which continue to enjoy a premium to the overall market) is approximately at Php750 to Php850 per sqm per month over 2012. Average rentals in prime office developments in Makati CBD are projected to hover around Php900 to Php1,000 per sqm per month. Meanwhile, rentals in office developments in Ortigas CBD are projected to reach around Php500 to Php650 per sqm per month. For office developments located in Bonifacio Global City, rentals are estimated within the range of Php650 to Php850 per sqm per month. In terms of capital values, Grade ‘A’ offices in Makati CBD are estimated to achieve resale prices at around Php75,000 to Php90,000 per sqm. In Ortigas CBD, average capital values of office spaces are projected within the range of Php45,000 to Php55,000 per sqm. Residential Condominium Sector From the economic slowdown in 2009, the residential property sector picked up in 2010 and continued to perform well in 2011. Demand continued to be fueled by the sustained inflow of remittances from overseas Filipinos coupled with the low interest rates
and flexible financing schemes. In terms of supply, the residential condominium market continued to exhibit strong growth as total stock in Makati CBD, Ortigas CBD, and Bonifacio Global City is estimated at around 45,300 units in 2011. Total Number of Residential Condominium Units Makati CBD, Ortigas CBD and Bonifacio Global City: By Type of Units (2001 - 2015E) 120,000
100,000
80,000
60,000
40,000
20,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E Makati CBD
Bonifacio Global City
Ortigas
Supply side factors in the residential sector remain a concern as the number of residential condominium buildings further increases. The large magnitude of supply expected in the coming years may negatively affect the growth of rentals and capital values. From 2012 to 2015, around 54,000 residential units are expected to be added to the total supply in Makati CBD, Ortigas CBD and Bonifacio Global City. On average, around 13,000 units are expected per year for the next four years. Rental rates of condominiums located in Makati CBD, Ortigas CBD and Bonifacio Global City averages between Php375 and Php700 per sqm per month. Meanwhile, average resale capital values in these districts range from around Php60,000 to Php115,000 per sqm, depending on the quality and location of the condominium. Hotels and Service Apartments Sector The total number of hotel rooms has reached 15,765 rooms (as of April 2011). Majority of the supply still stems from the deluxe and standard hotel classification. These types of hotels also pose the highest occupancy rates from January to August 2011. Occupancy rates of deluxe hotels picked up as it rose to 72% while average occupancy of standard hotels remained at 66%. However, overall occupancy of hotels across the various classifications remained at roughly the same level. After the slight decline in occupancy rates in 2009, which may be attributed to the global economic slowdown, performance of hotels picked up in 2010. With the help of the growing number of tourists coming into the country hand in hand with the economic recovery in many countries, many hotels experienced a boost in their occupancy rates, especially with deluxe hotels. This trend continued through 2011, as occupancy rates continued to rise for deluxe hotels.
Average Occupancy Rates of Hotels in Metro Manila By Hotel Classification: 1996 to 2011 80% 70% 60% 50% 40% 30% 20% 10% 0%
96
97
98
99
00
01
02
03
04
05
06
07
08
09
10
11
Deluxe (5-star)
75.00 73.00 60.00 63.81 65.27 58.39 62.72 61.23 71.03 74.03 73.63 73.84 70.11 64.43 70.45 72.17
First Class (4-star)
66.00 70.00 55.00 60.44 50.80 54.24 59.90 59.94 65.80 70.22 72.32 75.89 68.97 60.61 62.43 60.17
Standard (3-star)
65.00 62.00 53.00 51.53 53.14 52.51 55.88 58.97 64.28 67.88 70.29 71.81 70.77 67.77 65.72 66.05
Economy (2 and 1-star) 49.00 57.00 51.00 53.24 37.97 41.13 51.34 54.07 54.12 65.90 58.42 61.76 62.32 64.63 59.04 63.18 Deluxe (5-star) First Class (4-star) Standard (3-star) Economy (2 and 1-star)
In the next four years, more than 9,000 hotel rooms are expected to open in Metro Manila. In 2012 alone, around 2,000 hotel rooms would be added to the Metro Manila market. Upcoming hotel
developments are expected in Quezon City, the Bay Area, Bonifacio Global City and Alabang are expected to boost tourist arrivals in the next few years. Retail Sector
In 2011, the retail property sector sustained its positive performance as shopping mall rentals witnessed growth and new retail stock was added during the year. The retail market continues to benefit from the country’s large consumer market, which is supported by the remittances from overseas Filipinos. Despite the various ongoing problems affecting the global economy, such as the debt crisis in the Eurozone and the slow recovery of the US economy, remittances still grew by around 7% from January to September 2011. Despite the various ongoing problems affecting the global economy, such as the debt crisis in the Eurozone and the slow recovery of the US economy, remittances still grew by around 7% from January to September 2011. Total remittances in 2011 is estimated at around USD20 billion, while remittances for 2012 is forecast to grow by 5%. As a result of a stable inflow of remittances from overseas Filipinos and the generally healthy spending of consumers in the country, demand in the retail property market witnessed positive growth in the last couple of years with the entry and expansion of new international retailers. Most of these retailers have either food or clothing businesses. In 2012, many of these new retailers are expected to expand within Metro Manila, and may venture out to other urban centers in the Philippines. In terms of supply, there were a few new shopping malls and expansions of existing malls completed in 2011. With these new additions, total retail stock of major malls in Metro Manila reached 4.0 million sqm. In the next few years, Metro Manila will likely witness several new mid-scale shopping malls, more expansions of existing shopping centers as well as retail malls within mixeduse developments. In 2012, more than 200,000 sqm of retail space is expected to be added to the total retail stock in Metro Manila. Despite the additional retail space, JLLL Research, Consulting & Valuation estimates vacancy rates in major malls to
Accumulated Total Supply of Gross Leasable Space (in sq. m.) Major Metro Manila Retail Malls 1995-2012E
4,500 4,000 3,500
GLA (in '000 sqm)
3,000 2,500 2,000 1,500 1,000 500
E 12
11
20
10
20
09
20
20
08
07
20
06
20
05
20
20
04
03
20
02
20
01
20
20
00
99
20
98
19
97
19
19
96
19
19
95
0
remain in the vicinity of 4%-5%. In addition, mall developers are also entering other underserved provinces where shopping centers are few and rare. Overall, retail supply in the Philippines is expected to follow an upward pattern in the short- to mediumterm. Industrial Sector The industrial property sector recovered in the early part of 2011 as evidenced in the positive figures recorded over the said period. Industrial land values picked up as developers faced renewed interest from firms riding on the positive growth of the economy. Average estimated land values in Cavite and Laguna were observed to be between Php 3,000 and Php 3,700 per sqm. Meanwhile, asset performance likewise improved as average rentals in the aforementioned areas reached Php 110 to Php184 per sqm per month. The sector remained relatively stable despite the set of crises in Japan and more recently, the double digit dip in the country’s exports in September. Total foreign direct investments in the country surged in 3Q11, posting a 32% growth to Php 25 billion. Approximately Php 9.6 billion of investment pledges were cornered by the manufacturing sector alone. This growth in investments may represent the increased interest of foreign firms to enter the Asian market as Western economies are poised to post slow growth in the medium term. This increased interest may also be reflected in the sustained take up of industrial products coupled with the higher number of on-going constructions in select ecozones of the country. The industrial market may exhibit subdued growth in 2012 as externalities continue to exert pressure over the global economy. In particular, the growing US debt and Eurozone crisis may impact on the export-dependent Asian economies. Despite these externalities, industrial growth may be supported in the medium term by regional trade with the country’s resilient Asian trading partners. In the local scene, the open access to electricity is expected to be implemented by September 2012 and is projected to assist firms in securing cost-effective power rates which may improve the marketability of the industrial sector. Disclaimer: This document is prepared by Jones Lang LaSalle Leechiu, for information only. Whilst reasonable care has been exercised in preparing this document, it is subject to change, and Jones Lang LaSalle Leechiu makes no representations as to its truth, accuracy or completeness, and accordingly cannot be held responsible for any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document.
Provided by : Jones Lang Lasalle Leechiu
Jones Lang LaSalle Leechiu is the leading provider of professional services in real estate in the Philippines. Globally, the firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2010 global revenue of more than USD 2.9 billion, Jones Lang LaSalle serves clients in 60 countries from more than 1,000 locations worldwide, including 185 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.8 billion square feet worldwide. Jones Lang LaSalle has over 50 years of experience in Asia Pacific, with over 19,400 employees operating in 78 offices in 13 countries across the region. Jones Lang LaSalle Leechiu is currently the number one agency in the Philippines, bringing together strong local presence and talent and a global platform and infrastructure. Jones Lang LaSalle Leechiu 5/F Equitable Bank Tower 8751 Paseo de Roxas 1226 Makati City Philippines Telephone : +63 (2) 902 0888 Fax : +63 (2) 729 5159 Website : www.joneslanglasalleleechiu.com.ph : ap.joneslanglasalle.com/researchhub For more information, please contact : David T. Leechiu Country Head Telephone : +63 (2) 902 0880 Mobile : +63 (918) 910 5158 Email : [email protected] Claro dG. Cordero, Jr. Head, Research, Consulting & Valuation Telephone : +63 (2) 902 0887 Mobile : +63 (918) 914 3309 Email : [email protected]
PHILIPPINES KEY DATA POPULATION
Population (August 2007) Population # (2012)
88.57M 97.69M
Urban Population * Population under 15
30.14% 31.97%
Population over 65 Ave. annual growth rate (2000 - 2007)
3.31% 2.04%
GEOGRAPHY
Land Area Agricultural Area (2010) Capital City (population metropolitan Manila) (population Manila)
300,000 km2 42.98% Manila 11.55M 1.66M
ECONOMY 2011
Monetary Unit Average Headline Inflation rate (Jan - Nov)
Peso
(2006 = 100) Gross Domestic Product (GDP) (1Q to 3Q) GDP per capita
4.83%
CONSTRUCTION (1Q to 3Q) in 2011
Gross value of const. output Net value of const. output Net value of const. output as a proportion of the GDP
* #
Population of Philippines’ key cities only Forecast / Projected
Php 7,005.072bn Php 79,090.80
Php 538.736bn Php 393.553bn 2.07%
ECONOMIC HIGHLIGHTS 3rd Quarter 2011 Philippine Economy grows by 3.2 percent in Q3 2011 The domestic economy has decelerated for the third consecutive quarter from the 7.3 percent honey moon growth last year to 3.2 percent this year. The so called death spiral of debt that hounds our trading partners, the uninvigorating, albeit already expanded government spending, and the decline in fishing due to unfavorable weather and the high cost of fuel contributed to this relatively lethargic growth. As almost always, the Services sector saved the domestic economy from posting an even lower growth. With the downwardly revised second quarter GDP estimate, this puts the growth for the first nine months of 2011 at 3.6 percent, quite a distance even from the lower end of the whole year target of 4.5 percent. On the demand side, consumer spending bolstered growth but Construction continued to suffer from the much delayed implementation of the Public-Private Partnership program while Export of Goods really got hit by the global crisis, posting a double digit decline for the first time since the second quarter of 2009. Industry declines The Industry Sector contracted by 0.2 percent, its second consecutive quarter of decline after posting robust growths in the preceding five quarters. Manufacturing and Mining and Quarrying contributed positively to Industry with [2.06 percentage point] and [0.03 percentage point]; respectively. Construction was the star under performer again, pulling down the growth of Industry [with negative 2.15 percentage point]. Electricity, Gas and Water Supply, likewise made a negative contribution of [0.12 percentage point]. Construction slumps For the second consecutive quarter, Construction declined by 12.2 percent from a growth of 15.6 percent recorded last year with the decline of Private Construction and the contraction, albeit lower, of Public Construction. Source
: The National Accounts of the Philippines National Statistical Coordination Board (www.nscb.gov.ph)
CONSUMER PRICE INDEX % Change in CPI Index 9 8 7 6 5 4 3 2 1 0
2007
2008
2009
2010
2011
Year
Note
Year
Index
% Change
2006
100.0
2007
102.9
2.95%
2008
111.4
8.15%
2009
116.0
4.22%
2010
120.4
3.80%
2011*
126.0
4.84%
: Base date 2006 = 100 * January - November 2011 CPI Average
EXCHANGE RATES
Approximate rates prevailing as at 02 January 2012 US$ in PHP in Foreign Foreign Currency Currency
Currency
Foreign Currency in PHP
Australia*
dollar
44.88
0.0222
0.98
Bahrain*
dinar
116.50
0.0085
0.38
Brunei*
dollar
33.74
0.0296
1.30
Canada*
dollar
43.09
0.0232
1.02
China*
yuan
6.95
0.1434
6.32
Denmark+
kroner
7.65
0.1438
6.32
COUNTRY
European Currency Unit*
euro
56.84
0.0175
0.77
Hong Kong*
dollar
5.65
0.1768
7.77
India+
rupee
0.83
1.2070
53.01
Indonesia*
rupiah
0.00
208.3333
9,090.00
yen
0.57
1.7519
76.94
ringgit
13.86
0.0721
3.17
New Zealand+
dollar
34.12
0.0293
1.29
Norway
kroner
7.34
0.1361
5.97
Japan* Malaysia+
Notes: * Convertible currencies with BSP + Non Convertible currencies with BSP BSP Bangko Sentral ng Pilipinas Source: Business Worls - BSP Reference Rate
COUNTRY
Pakistan+
Currency
Foreign PHP in US$ in Currency Foreign Foreign in PHP Currency Currency
rupee
0.49
2.0441
89.78
rial
11.71
0.0853
3.75
Singapore*
dollar
33.87
0.0295
1.29
South African+
rand
6.49
0.1542
6.79
South Korea*
won
0.38
26.3852
1,158.75
Sweden+
kroner
6.37
0.1568
6.88
Switzerland*
franc
46.842
0.0213
0.94
Saudi Arabia*
Taiwan+
NT dollar
1.45
0.6892
30.27
Thailand*
baht
1.40
0.7179
31.53
United Arad Emirates (UAE)*
dirham
11.96
0.0836
3.67
United Kingdon*
pound
68.25
0.0146
0.64
dollar
43.92
0.0227
1.00
United States of America*
CURRENCY CHARTS Note: Monthly Average Rate
Sterling Pound
US Dollar Php per US$
Php per GBP
60
120
50
100
40
80
30
60
20
40
10
20
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008
Year
2009
2010
2011
2009
2010
2011
2010
2011
Year
Singapore Dollar
Japanese Yen
Php per Singaporean Dollar
Php per 100 Japanese Yen 60
40
50 30
40 30
20
20 10
10
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008
Year
Year
Euro
Dirham
Php per Dirham
Php per Euro
16
80
14
70
12
60
10
50
8
40 30
6 4
20
2
10
0
0 2006
2007
2008
2009
2010
2011
2006
2007
2008 Year
Year
Hong Kong Dollar
Australian Dollar
Php per Hong Kong Dollar
Php per Australian Dollar
10
50
8
40
6
30
4
20
2
10
0
0 2006
2007
2008 Year
2009
2009
2010
2011
2006
2007
2008 Year
2009
2010
2011
MANILA REFERENCE RATE Manila Reference Rate (%) 10
8
6
4
2
0 2006
2007
2008
Year
2009
2010
2011
PHILIPPINE CENTRAL BANK MANILA REFERENCE RATE DATE
Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec
%
2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011
Note: Based on all maturities.
6.81 7.13 6.63 6.63 6.31 6.56 5.75 6.06 5.63 5.63 5.06 5.38 5.50 5.40 5.02 4.88 4.79 4.81 4.88 4.86 4.71 4.71 4.83 4.81
PHILIPPINE MAP
ENVIRONMENTAL SUSTAINABILITY Overview of Leadership in Energy & Environmental Design (LEED) The U.S. based Leadership in Energy & Environmental Design (LEED) Green Building System is a voluntary third-party rating system in which credits are earned for satisfying specified green building criteria. Projects are evaluated within six environmental categories. • • • • • •
Sustainable Sites Water Efficiency Energy & Atmosphere Materials & Resources Indoor Environmental Quality Innovation & Design
Certified, Silver, Gold and Platinum levels of green building certification are awarded based on the total points earned. Professional Services Pre Design Integrated sustainable design consulting ensures available opportunities are recognized and explored • Assist in team selection • Evaluate project-specific opportunities and challenges based on LEED goals • Create project-specific green guidelines Design Team members works closely and effectively towards a green solution. • Create sustainable design checklist including schedule and design implications • Thoroughly evaluate design at key stages and provide detailed instructions to the design team • Monitor design team responsibilities • Coordinate cost analysis with sustainable design goals • Develop on energy model • Liaise with USGBC • Assist and compile LEED documentation for Green Building Certification Institute (GBCI) review Construction • Provide pre-bid conferences and contractor training • Assist during construction, including submittals and progress reports • Monitor the implementation of green guidelines or green site conditions • Liaise with USGBC • Assist and compile LEED documentation for certification
Operations • Perform post-occupancy project audits - lessons Being part of LEED Global Linkage Davis Langdon & Seah (Phils) Inc. is a member of US Green Building Council (USGBC) and the Philippine Green Building Council (PGBC). Our environmental sustainability services employed highly skilled Leadership in Energy & Environmental Design - Accredited Professionals (LEED-®AP), certified Building for Ecologically Responsive Design Excellence (BERDE) Professionals and highly qualified Energy Modeller. Green Building Facts • An Up-front investmentof 5-7% in green building design, on average, results in life cycle savings of 20% of the total construction cost. Source: The Costs and Financial Benefits of Green Buildings: A report to California’s sustainable Building Task Force, October 2003 • Operating cost decrease 8-9% • Building value increase 7.5% • Return on investment improved 6.6% • Occupancy ratio increase 3.5% • Rent ratio increases 3% Source: McGraw Hill Construction, Greening of Corporate America SmartMarket Report, 2007. • Green buildings consume less energy and fewer resources • Green buildings consume 15-20% average less energy than conventional buildings • Green buildings save, on average, 40% of drinkable / potable water • Corporate perception of whether green fosters innovation: 57% agree; 28% neutral and 15% disagree. Source: McGraw Hill Construction, Greening of Corporate America SmartMarket Report, 2007.
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, India, Malaysia, Philippines and Vietnam and is also the editor of the Spon’s Price Book Series which comprise • Spon’s Asia Pacific Construction Costs Handbook • Spon’s European Construction Costs Handbook • Spon’s Architects' and Builders’ Price Book • Spon’s Civil Engineering and Highway Works Price Book • Spon’s Mechanical and Electrical Services Price Book • Spon’s Landscape and External Works Price Book (co-edited by Derek Lovejoy Partnership) As in the previous editions, the DLS Handbook -Singapore 2012 focuses on the construction cost profile of Singapore and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in Asia. The information contained in this handbook has been compiled by Davis Langdon & Seah Singapore Pte Ltd. Any further information and/or if advice relating toparticular projects is required, please contact any of the regional offices listed under the Directory of Davis Langdon & Seah International Offices at the end of this handbook. Davis Langdon & Seah Singapore Pte Ltd
MATERIAL PRICE INDICES CEMENT IN BULK YEAR $/TONNE
INDEX (BASE 1994)
STEEL BARS
INFLATION $/TONNE
BRICKS^
INDEX (BASE 1994)
INFLATION
$/'000 BRICKS
INDEX (BASE 1994)
READY MIXED CONCRETE 1
GRANITE INFLATION $/TONNE
INDEX (BASE 1994)
INFLATION
$/m 3
INDEX (BASE 1994)
INFLATION
94
135.00
100.0
-
585.04
100.0
-
233.00
100.0
-
17.97
100.0
-
101.35
100.0
-
95
134.00
99.3
-0.7%
542.51
92.7
-7.3%
244.00
104.7
4.7%
18.11
100.8
0.8%
103.01
101.6
1.6%
96
135.00
100.0
0.7%
526.97
90.1
-2.8%
240.00
103.0
-1.6%
20.68
115.1
14.2%
111.04
109.6
7.9%
97
131.00
97.0
-3.0%
521.03
89.1
-1.1%
227.00
97.4
-5.4%
22.12
123.1
7.0%
106.96
105.5
-3.7%
98
107.00
79.3
-18.2%
522.86
89.4
0.3%
185.00
79.4
-18.5%
14.45
80.4
-34.7%
83.35
82.2
-22.1%
99
74.00
54.8
-30.9%
474.50
81.1
-9.3%
135.00
57.9
-27.1%
11.38
63.3
-21.3%
70.36
69.4
-15.6%
00
71.00
52.6
-4.0%
458.65
78.4
-3.3%
141.00
60.5
4.5%
12.55
69.8
10.3%
71.32
70.4
1.4%
01
70.00
51.9
-1.3%
432.81
74.0
-5.6%
147.00
63.1
4.3%
12.69
70.6
1.1%
61.40
60.6
-13.9%
02
67.00
49.6
-4.4%
442.92
75.7
2.3%
149.00
63.9
1.3%
12.65
70.4
-0.3%
55.41
54.7
-9.7%
03
71.00
52.6
6.0%
579.62
99.1
30.9%
163.00
70.0
9.5%
12.25
68.2
-3.1%
56.75
56.0
2.4%
04
76.76
56.9
8.2%
863.40
147.6
48.9%
185.77
79.7
13.9%
12.57
69.9
2.5%
62.50
61.7
10.2%
05
85.21
63.1
10.9%
738.44
126.2
-14.5%
267.86
115.0
44.3%
16.29
90.7
29.8%
72.13
71.2
15.4%
06
88.02
65.2
3.3%
729.52
124.7
-1.2%
-
-
-
16.58
92.3
1.8%
73.88
07*
115.40
08
85.5
120.40
09
89.2
93.40
10
69.2
89.00
11p**
65.9
94.60
70.1
31.1% 4.3% -22.4% -4.8% 6.4%
1,054.60 913.00 722.50^^ 867.50 936.00
180.3 156.1 123.5^^ 148.3 160.00
44.6%
-
-13.4%
-
-
-20.9%
-
-
20.1%
-
-
-
7.9%
-
-
-
-
-
-
24.10 23.90 17.10 23.40 20.20
127.00
125.3
-0.8%
121.90
2
120.3
2
-4.0%
-28.4%
3
3
-23.4%
105.3
4
14.3%
107.7
4
2.3%
45.3%
133.0 130.2 112.4
2.4% 2
134.1 95.2
72.9 2
93.30
36.8%
106.70
4 4
-13.7%
109.20
92.1
71.9%
Source: Building and Construction Authority as at 8 November 2011 Note: ^From 1st Quarter 2006, statistics on bricks have been discontinued. *Market prices from 2007 to 2010 are based on prices as at the month of December. **Market prices for 2011 are preliminary ('p' denotes preliminary) and are based on prices as at the month of October. ^^The market prices of rebar from 2009 onwards are based on fixed supply contracts with contract period 6 months or less. 1 Prior to 2007, the market prices of ready mixed concrete (RMC) were for Grade 30. 2 The market prices of RMC were for Grade 35. 3 The market prices of RMC were based on non-fixed price contract for Grade 35 Pump. 4 The market prices of RMC are based on contracts with non-fixed price, fixed price and market retail price for Grade 40 Pump. 200
160
120
80
40 94
95
96
97
98
99
Cement In Bulk
00
01
Steel Bars
02
03
Bricks
04
Granite
05
06
07
08
Ready Mixed Concrete
09
10
11p
TENDER PRICE, MATERIAL, LABOUR AND CONSUMER PRICE INDICES BCA TPI YEAR
INDEX
BCA BMPI
INFLATION
INDEX
(BASE 2005)
INDEX
BCA LCI INFLATION
INDEX
(BASE 2005)
CPI*
INDEX
INFLATION
INDEX
(BASE 2005)
INDEX
INFLATION
(BASE 2005)
94
100.7
-
118.2
97.5
-
105.3
102.5
-
82.3
91.0
-
95
104.8
4.1%
119.9
98.9
1.4%
109.3
106.4
3.8%
83.7
92.6
1.7%
96
107.6
2.7%
120.8
99.7
0.8%
112.2
109.3
2.7%
84.9
93.9
1.4%
97
107.3
-0.3%
119.4
98.5
-1.2%
111.2
108.3
-0.9%
86.6
95.8
2.0%
98
100.2
-6.6%
115.9
95.6
-2.9%
112.0
109.1
0.7%
86.4
95.5
-0.3%
99
88.9
-11.3%
111.9
92.3
-3.5%
98.7
96.1
-11.9%
86.4
95.5
0.0%
00
87.9
-1.1%
112.4
92.7
0.4%
103.1
100.4
4.5%
87.6
96.8
1.3%
01
88.1
0.2%
112.5
92.8
0.1%
102.3
99.6
-0.8%
88.4
97.8
1.0%
02
89.9
2.0%
112.5
92.8
0.0%
104.7
101.9
2.3%
88.1
97.4
-0.4%
03
95.6
6.3%
113.6
93.7
1.0%
104.9
102.1
0.2%
88.5
97.9
0.5%
04
98.9
3.5%
117.9
97.3
3.8%
104.6
101.9
-0.2%
90.0
99.5
1.7%
05
100.0
1.1%
121.2
100.0
2.8%
102.7
100.0
-1.9%
90.4
100.0
0.5%
06
103.2
3.2%
-
-
-
-
-
-
91.3
101.0
1.0%
07
122.5
18.7%
-
-
-
-
-
-
93.2
103.1
2.1%
08
137.3
12.1%
-
-
-
-
-
-
99.4
109.9
6.6%
09
115.9
-15.6%
-
-
-
-
-
-
100.0
110.6
0.6%
10
114.4
-1.3%
-
-
-
-
-
-
102.8
113.7
2.8%
11**
114.5
0.1%
-
-
-
-
-
-
109.2
120.7
6.2%
*The Singapore Department of Statistics has rebased the Consumer Price Index (CPI) Base Year to Year 2009. **Indices for 2011 are based on 3rd Quarter 2011. Source: Building and Construction Authority and Singapore Department of Statistics 145
135
125
115
105
95
85 94
95
96
97
98
BCA TPI
99
00
01
02
BCA BMPI
03
04
05
BCA LCI
06
07
08
CPI
09
10
11
STANDARD FORMS (PRIVATE SECTOR) MAIN FEATURES SIA Articles and Conditions of Building Contract (1) Contractor’s rates include all other works necessary to complete the Works, whether or not specifically mentioned in the Contract Documents [Article 5] (2) Architect’s orders must be expressed as ‘directions’ or ‘instructions’ [Clause 1(2)] (3) Contractor is responsible for own design and of his sub-contractors or suppliers [Clause 3(1)] (4) Contractor must supply a make-up of his prices [Clause 5] (5) Provision is made for staged possession of the site and phased completion of the Works [Clauses 10 and 25] (6) No provision for Employer to take out insurances [Clauses 19 and 20] (7) Contractor’s notification within 28 days of any event, direction or instruction entitling the Contractor to an extension of time with condition precedent to an extension of time [Clause 23(2)] (8) Following failure of Contractor to remedy any defects within 3 months from the date of issue of Schedule of Defects (or such other time as stated in the Appendix), Architect must direct the Contractor, within 14 days from the expiry of 3 months from the issue of the Schedule of Defects, that a defect need not be remedied. In lieu thereof, the Employer may deduct from any monies due to or recover from the Contractor based on the estimated cost incurred by the Employer to employ other Contractors to remedy the defects [Clause 27.4] (9) After the expiry of the Maintenance Period and all defects are either remedied, or dealt with under Clause 27.4, Architect to issue Maintenance Certificate [Clause 27.5] (10) Contractor is responsible for Designated/Nominated SubContractors in respect of design, delays, etc [Clause 28(2)] (11) Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) on Employer on the last day of each month following the month in which the contract is made (or otherwise by such time or on such day specified in Appendix) where interim payment is based on periodic valuation, or on certified completion of the relevant stage where interim payment is by stage instalments [Clause 31(2)] (12) Architect issues Interim Certificates within 14 days after receipt of payment claim [Clause 31(3)] (13) Second release of Retention monies shall be paid under the Final Certificate issued by the Architect at the expiry of the Maintenance Period or the issuance of Maintenance Certificate, whichever is the later [Clause 31(10)]
(14) Architect has no power to certify compensation to Contractor for breaches of contract by Employer [Clause 31(14)] (15) Employer responds to payment claim by providing, or causing to be provided, a payment response within 21 days after service of payment claim by Contractor [Clause 31(15)] (16)Contractor entitled to serve Notice of Termination following failure of payment of adjudicated amount by Employer [Clause 33(3)] (17)Contractor entitled to suspend work pursuant to provisions of Building and Construction Industry Security of Payment Act [Clause 33(6)] (18) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 38] (19) Parties may refer technical disputes to expert determination; provision for expert determination does not affect or prejudice right to refer dispute to mediation or arbitration [Clause 38A]( 20)Optional clauses permit fluctuations on specified materials [Clause 39] and insurance excesses [Clause 40] SIA Conditions of Sub-Contract (1) Contractor issues directions and instructions to the SubContractor [Clause 5.1] (2) Contractor orders variations on sub-contract works [Clause 7.1] (3) Application for extension of time is made to the Contractor, not the Architect [Clause 11.2] (4) Time period for notification of any event, direction or instruction entitling the Sub-Contractor to an extension of time is 21 days [Clause 11.2] (5) Extension of time is assessed and granted by the Contractor [Clause 11.2] (6) The following certificates are issued by the Contractor: - Sub-Contract Completion Certificate [Clause 11.3] - Sub-Contract Maintenance Certificate [Clause 12.2] - Sub-Contract Termination Certificate [Clause 13.1] (7) Provision for recovery of general damages only - amount is set off and deducted from monies due to the Sub-Contractor after condition precedents are satisfied [Clause 11.4] (8) Contractor can terminate sub-contract without the need for the Architect to issue notices [Clause 13.1] (9) Sub-Contractor is entitled to serve Notice of Termination following failure of payment of adjudicated amount by Contractor [Clause 13.6]
(10) Sub-Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) on Contractor on the last day of each month following the month in which the subcontract is made where interim payment is based on periodic valuation, or on certified completion of the relevant stage where interim payment is by stage instalments [Clause 14.4] (11) Contractor responds to payment claim by providing, or causing to be provided, a payment response within 21 days after service of payment claim by Sub-Contractor [Clause 14.5] (12) Where sub-contract is a supply contract, Contractor o respond to payment claim by paying Sub-Contractor claimed amount or such amount as Contractor agrees to pay [Clause 14.6] (13) Contractor has no power to revise or correct any certificates issued by him save for clerical, computational or typographical errors, or errors of a similar nature [Clause 14.10] (14) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 16] (15) Parties may refer technical disputes to expert determination; provision for expert determination does not affect or prejudice right to refer dispute to mediation or arbitration [Clause 16A] REDAS Design and Build Conditions of Contract (1) No order of priority for Contract Documents; in the event of any discrepancies between the documents, Employer's Requirements shall prevail [Clause 1.7] (2) Provision for Named Sub-Contractors; Contractor is entitled to rights of objection [Clause 2.4 and 2.5] (3) Contractor's Works and design shall be fit for their intended purpose in accordance with the Employer's Requirements; Contractor also responsible for the sufficiency and correctness of the Employer's designs, specifications and calculations in the Employer's Requirements [Clause 4.1] (4) Administration of the Contract is carried out by the Employer's Representative appointed by the Employer; Employer's Representative's duties can be delegated to assistants with Employer's consent [Clause 5] (5) Provision is made for completion of the Works in whole or in phases/sections [Clause 10] (6) Contractor must satisfy extensive criteria before handing over [Clause 11] (7) Employer may occupy any parts of the Works upon issuance of the Handing Over Certificate of Occupied Part by the Employer's Representative [Clause 12] (8) Contractor’s application for extension of time within 28 days of occurance of cause of delay is condition precedent to an extension of time [Clause 16.2]
(9) Contractor entitled to serve payment claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act 2004) (“the SOP Act”) on the Employer on the last day of each month following the month in which the Contract is made (or otherwise by such time or on such day as stated in Appendix 1) [Clause 22.1] (10) Employer’s Representative issues Interim Payment Certificate within 14 days of receipt of payment claim [Clause 22.2] (11) Interim payment certificate or final payment certificate issued by the Employer’s Representative shall be deemed the payment response from the Employer under the SOP Act if the Employer does not provide any response within 21 days of service of payment claim. Where the Employer provides a payment response within 21 days of service of payment claim, such response shall take precedence over the interim payment certificate or final payment certificate [Clause 22.4] (12) Application for final payment claim by Contractor to issuance of final payment certificate by the Employer’s Representative is regulated by a procedure [Clause 24] (13) Claims for additional payment are regulated by a claims procedure [Clause 29] (14) Employer may at his convenience at any time to terminate the Contract without cause [Clause 30.1] (15) Contractor entitled to suspend work pursuant to provisions of SOP Act [Clause 31.1] (16) Contractor entitled to serve Notice of Termination following failure of payment of adjudicated amount by Employer [Clause 31.2] (17) Upon issuance of a Notice of Taking Over, Employer may take over design and construction of a part of the Works where termination for default is not practical as a default may relate to a specific part only [Clause 32] (18) Parties may refer dispute to mediation; provision for mediation does not affect or prejudice right to refer dispute to arbitration [Clause 33] (19) Additional optional clause permit fluctuations on specified materials used for permanent works only [Clause 34] (20) Option Module (with Employer’s Architectural Design) where the Employer retains his own design consultants to provide the architectural design works and make the statutory submissions FIDIC Conditions of Contract for Construction for Building and Engineering Works designed by the Employer (1) Documents forming the Contract are accorded a sequence of priority for purposes of interpretation [Clause 1.5] (2) Administration of the Contract and supervision of the execution of the Works are carried out by the Engineer appointed by the Employer [Clause 3.1]
(3) Provision is made for the Contractor to design the Works to the extent specified in the Contract [Clause 4.1] (4) Contractor is obliged to submit detailed time programme within 28 days from receipt of notice of the Commencement Date [Clause 8.3] (5) Employer may take over any part of the Works upon issue of a Taking-Over Certificate by the Employer [Clause 10.2] (6) Employer is entitled to an extension of the Defects Notification Period (by not more than two years) if the Works or a Section thereof cannot be used by reason of a defect or damage [Clause 11.3] (7) Contractor may submit to the Engineer value engineering proposals to accelerate completion, reduce cost of construction, maintenance and operation, or improve efficiency or value to the Employer [Clause 13.2] (8) Quantities in the Bill of Quantities are estimated quantities [Clause 14.1] (9) Provision for advance payment to the Contractor upon submission of an Advance PaymentGuarantee, if Employer agrees [Clause 14.2] (10) Amount certified in Interim Payment Certificate is paid by the Employer within 56 days from receiptof the Contractor's Statement and supporting documents [Clause14.7] (11) Employer is entitled to terminate the Contract without cause at any time for his convenience subject to certain provisions [Clause 15.5] (12) Insuring party is the Contractor unless otherwise stated in the Particular Conditions that the Employer wishes to effect insurances [Clause 18.2] (13) Provision is made for disputes to be adjudicated by a Dispute Adjudication Board [Clause 20] (14) Claims for additional payment and extension of time are regulated by a claims procedure which inter alia, requires the Engineer or Employer to respond within a given time period [Clause 20]
STANDARD FORMS (PUBLIC SECTOR) MAIN FEATURES Public Sector Standard Conditions of Contract for Construction Works (PSSCOC) (1) Superintending Officer, Superintending Officer’s Representative and assistants to Superintending Officer and Superintending Officer’s Representative are appointed for design, cost control and contract administration [Clause 2] (2) Failure to comply with the Superintending Officer’s instructions entitles the Employer to recover any cost, loss, expense and damage incurred inemploying another contractor and any other loss or damage as a result of the Contractor’s default [Clause 2] (3) Contractor must provide a security deposit (either as cash deposit or guarantee from a bank or Monetary Authority of Singapore approved insurer) within 14 days from letter of acceptance or such other longer period as stated in Appendix [Clause 4.5] (4) Employer may provide geotechnical information but it does not relieve the Contractor from carrying his own investigation or search for existing and other additional relevant information [Clause 5.1] (5)
If Contractor encounters adverse physical conditions (which include unforeseen sub-surface and ground conditions and underground services), he may be granted extension of time and loss and expense provided such conditions could not have been reasonably foreseen by an experienced contractor [Clause 5.2]
(6) Superintending Officer has express power to suspend the Works, and if suspension is more than 90 days, Contractor may regard it as omission of the affected part (which is suspended) or a termination (where the suspension affected the whole Works) [Clause 13] (7) If progress or completion of the Works will be delayed, Contractor has to notify the Superintending Officer within 60 days of occurrence of the delaying event [Clause 14.3] (8) Superintending Officer may require the Contractor to submit quotation for any proposed variation before issuing an instruction [Clause 19.3] (9) Superintending Officer has 60 days from the date of certified substantial completion of the variation works to value the amount due and notify the Contractor [Clause 20.2(2)] (10) Provision is made for Contractor to recover loss and expense as a result of regular progress and/or completion of the Works having been disrupted, prolonged or materially affected by variation instructions, failure to give site possession, suspension, late supply of information, Superintending Officer’s instructions (which Employer is liable to pay loss and expense),unforeseeable adverse physical conditions, acts or omissions of other contractors and Employer’s act of prevention or breach of contract [Clause 22]
(11) Superintending Officer has power to certify amounts payable to the Contractor for all work executed until termination (where such termination is without default of the Contractor) and any loss and expense suffered by the Contractor [Clause 31.4] (12) Superintending Officer has to issue a Payment Certificate to the Contractor within 14 days of receipt of a Payment Claim (which is defined as having the same meaning ascribed in the Building and Construction Industry Security of Payment Act) [Clause 32.2(1)] (13) Payment Certificate issued by Superintending Officer shall be deemed the Payment Response from the Employer under the Building and Construction Industry Security of Payment Act if the Employer does not provide any response within 14 days from the Payment Claim [Clause 32.2(2)] (14) Where the Employer provides a Payment Response within 14 days from the Payment Claim, such response takes precedence over the Superintending Officer’s Payment Certificate [Clause 32.2(2)] (15) Contractor has 90 days from the Date of Substantial Completion to submit Final Payment Claim which shall constitute a Payment Claim under the Building and Construction Industry Security of Payment Act [Clause 32.4] (16) Superintending Officer has 21 days from receipt of Final Payment Claim to provide Contractor with an Interim Final Account and at the same time issue a Payment Certificate [Clause 32.5(1)] (17) Where Contractor fails to submit a Final Payment Claim, Superintending Officer has 150 days from the Date of Substantial Completion to issue Interim Final Account, and a further 30 days thereafter to issue a payment certificate. Interim Final Account and payment certificate under such circumstances are not subject to the Building and Construction Industry Security of Payment Act [Clause 32.5(2)] (18) Mechanism for fluctuation of materials prices applicable to specified materials in Appendix [Clause 33] (19) Any dispute or difference which involves a Payment Claim or Payment Response to which the Building and Construction Industry Security of Payment Act applies, entitles the Contractor to make an adjudication application [Clause 35.5(1)] (20) Employer can only recover from the Contractor any sum due or to become due under this contract (and not from any other contract between the Employer and the Contractor) [Clause 36.1] Public Sector Standard Conditions of Contract for Design and Build (PSSCOC D&B) (only main features which differ from the ‘Build’ form are highlighted below) (1) Contractor is responsible for choice of plant, materials, goods, workmanship and coordinating all design work [Clause 4.1] (2) Contractor to engage and include all fees, costs, etc in the Contract Sum for suitable qualified personnel viz, Registered Inspector, Resident Engineer and any others as required by statute; such persons cannot be replaced without prior consent of the Superintending Officer [Clause 4.2]
(3) Contractor must indemnify the Employer against all claims and proceedings for infringements of any patent rights, design, trademark name or copyright [Clause 4.6] (4) Contractor warrants that the Contractor’s Proposals meet the Employer’s Requirements and are fit for the purpose [Clause 6.1] (5) Contractor indemnifies the Employer for any breach of design responsibility in contract and under common law [Clause 6.1] (6) When the Works are substantially completed and the Temporary Occupation Permit obtained, Contractor gives notice plus an undertaking to complete any outstanding work during the defects liability period; Superintending Officer has 21 days from the notice to either issue certificate or instructions on works still to be completed [Clause 17] (7) No provision for Named Sub-Contractors
CONTRACTUAL ARRANGEMENTS Contractual arrangements are concerned with the typeof agreement to be entered into and the obligations,responsibilities, rights and liabilities assumed by the parties under a contract. It deals with the situation that exists from the time when a contract is formed until the time when all the obligations created by it have been discharged. Contractual arrangements may comprise the following: Conventional Contracts The commonest form of contract is one based upon the SIA Conditions of Contract. The design is prepared bya Consultant and the price of the works determined before award, usually by competition but occasionallyby negotiation. Small projects tend to be based upon specification and drawings whilst large projects are usually based upon bills of quantities. Design and Build Contracts A design and build contract is a contractual arrangementwhere the Employer employs a Contractor to design and build the project. The Contract Sum is inclusive of design work,management and construction costs. Develop and Construct Contracts A develop and construct contract is a contractual arrangement where the Employer engages consultants to design the project to a certain stage; the Contractor then develops and completes the design and constructs the building. Term Contracts Under term contracts, the Contractor signs a contract to carry out an indefinite amount of work within a certain framework over a time period or ‘term’. While exactly what is to be done may be uncertain, the generalcharacter of the work will usually be fairly easy to define. Orders for work are issued progressively from timeto time throughout the contract period. The work is measured, valued and the Contractor is paid accordingly subject to the tendered adjustment on the Schedule of Rates. Guaranteed Maximum Price (GMP) Contracts A GMP, effectively a guaranteed lump sum price for a project, is a set of conditions that can be introduced and used in conjunction with any standard form of contract, e.g. SIA Standard Form (for traditional procurement),JCT Standard Form with Contractor's Design or REDAS Design and Build Standard Form (for designbuild procurement) and JCT Management Contract Standard Form (for management contracting). It is not a standard form of contract. The guaranteed price is not subject to upward adjustment except for fundamental and material changes in the client scope of work or as a result of legislation or statutory requirements.
The benefits of GMP include greater price certainty, early start as design and construction can overlap, contractor's input and contribution on buildability, best practice construction methods and mutually beneficial partnering-style relationship. Management Contracts A management contract is one in which the Management Contractor is appointed to manage the planning and construction of a project and in which the construction work is executed by SubContractors working under him, selected and appointed as the job proceeds. The Management Contractor prepares the programme, decides on the contents of each work package to be sub-contracted, organises and manages the construction of all works which are undertaken by Sub-Contractors, each selected in competition. Construction Management Contracts Construction management contracts entail an interactive procurement concept involving combined efforts of the Employer, Construction Manager, design consultants and multitude of work package contractors. Under construction management contracts, theConstruction Manager is appointed to manage the entire delivery process from inception to completion while construction work is executed by a myriad of work package contractors engaged by the Employer, selected and appointed as the job proceeds. Public-Private Partnership (PPP) Public-Private Partnership (PPP) is a generic term whichdescribes the various structures possible whereby the public and private sectors work together in the delivery of services and the provision and operation of assets. Typical forms of project structures under PPP include PFI (Private Finance Initiative), DBFO (Design, Build, Finance, Operate), DCMF (Design, Construct, Manage, Finance), BOO (Build, Own, Operate), BOT (Build, Operate, Transfer) and BOOT (Build, Own, Operate, Transfer). Broadly, a typical PPP model involves the procuring authority (or public agency) contracting with the Special Purpose Vehicle (SPV) under a long-term service purchase agreement for the design, construction,maintenance and operation of the facility. The SPV enters into a range of subcontracts for the building works, and operations and maintenance of the new asset.
PREAMBLES The construction costs for the respective categories given on the following pages are average costing at 4th Quarter 2011. They are based on interpolation of competitive tenders received. The construction cost serves as a guide for preliminary cost appraisals and budgeting. It must be understood that the actual cost of a building will depend upon the design and many other factors such as major infrastructure of the buildings/structures, etc. and may vary from the figures shown. The costs per square metre are basedon construction floor areas measured to the outside face of the external walls/external perimeter including liftshafts, stairwells, plant rooms, water tanks and the like. As a guide, it might be worth to note that construction costs generally may vary accordingly depending on the following specific requirements: a. Complexity of the project b. Site encumbrances c. The need of special structural such as heavy transfer structures over MRT/RTS structures/tracks/boxes, etc. or due to close proximity to nearby infrastructure such as canals, bridges, etc. d. The types of structural system (i.e. reinforced concrete or structural steel system, precast/prefabrication, etc.) e. The types of temporary works required (i.e. diaphragm walls, sheet piling, etc.) f. The method of construction e.g. conventional or top down g. Basement works which are carried out in phases may require additional temporary works and different types of construction sequence h. Deep basement (i.e. levels of basement) i. Selection of Contractor (i.e. local or foreign) j. Shape of the existing site as longish sites would generally attract higher cost due to higher wall to floor ratio k. The level of Green Mark rating All buildings are assumed to have no basements (except otherwise stated) and are built on flat ground, with normalsoil conditions and minimal external works. The costs exclude the following: • Professional fees • Authorities’ plan processing charges • Land cost • Financing charges • Site inspectorate
CURRENT CONSTRUCTION REGULATIONS BCA Contractors Registry System (CRS) The Contractors Registry was established in 1984 to register contractors who provide construction-related goods and services to the public sector. Contractors who wish to be registered with the Registry must show that they have the relevant experience, financial, technical and management capability. The table below summaries the registration requirements for general building (CW01) and civil engineering works (CW02): GRADE (PLEASE REFER TO NOTE: 1)
A1
A2
B1
B2
FINANCIAL (MIN PAID-UP MANAGEMENT & CAPITAL & MIN NET DEVELOPMENT WORTH)
$15.0m
$6.5m
$3.0m
$1.0m
TRACK RECORD (PAST 3 YEARS)** CW01
Note: ADDITIONAL REQUIREMENTS
CW02
24RP/P/T incl min 8RP ISO9001:2008 (SAC) ISO14000 OHSAS18000/ SS506 Part 1
$150.0m
$150.0m
of which
of which
$75.0m PS
$75.0m PS
$112.5m MC
$75.0m MC
$37.5m SP
$37.5m SP
12RP/P/T incl min 4RP ISO9001:2008 (SAC) ISO14000 OHSAS18000/ SS506 Part 1
$65.0m
$65.0m
of which
of which
$32.5m PS
$32.5m PS
$48.75m MC
$32.5m MC
$16.25m SP
$16.25m SP
6RP/P/T incl min 2RP ISO9001:2008 (SAC) OHSAS18000/ SS506 Part 1 ISO14000 (by 1 Jul 13)
$30.0m
$30.0m
of which
of which
$22.5m MC
$15.0m MC
$7.5m SP
$7.5m SP
3RP/P/T incl min 1RP ISO9001:2008 (SAC) OHSAS18000/ SS506 Part 1 ISO14000 (by 1 Jul 13)
$10.0m
$10.0m
of which
of which
$7.5m MC
$5.0m MC
$2.5m SP
$2.5m SP
C1
$300,000
1P + 1T SMC
$3.0m
$3.0m
C2
$100,000
1P or 2T SMC
$1.0m
$1.0m
C3
$25,000
1T
$100,000 (Please refer to Note: 14)
$100,000 (Please refer to Note: 14)
i) Annual submission of financial accounts and certified VAP calculation ii) Annual submission of CET declaration iii) General Builder Licence Class 1 (GB1) i) Annual submission of financial accounts and certified VAP calculation ii) General Builder Licence Class 1 (GB1)
1) Please refer to Page 131 for the tendering limits 2) m stands for million 3) Both minimum (min) paid-up capital and minimumnet worth must be met. C3 firms are required to submit the latest management accounts (not more than 12 months old) 4) PS – projects executed in Singapore 5) MC – main contracts (nominated sub-contracts may be included) 6) SP – minimum size single project 7) Percentage of sub-contract value taken into consideration shall be 50% for CW01 and 75% for CW02 8) RP – Professional with relevant qualifications from universities recognised by PEB, BOA or BCA P/T – Professional and Technical personnel with relevant qualifications 9) PEB – Professional Engineers Board of Singapore 10) BOA – Board of Architects of Singapore 11) ISO 9001:2008 must be SAC accredited i.e. the certificate to bear the SAC logo
General Builder Licence Class 2 (GB2)
Source: Building and Construction Authority as at August 2011
12) SMC (Safety Management Certificate awarded by BCA) or OHSAS 18000 required for C1 and C2 13) CET – The continuing education and training (CET) requirement has been implemented since 1 November 2010. In order to retain their respective grades (i.e. A1 and A2), each registered personnel is required to complete 14 hours of structured CET courses annually over a 12-month period from 1 November to 31 October (of the next calendar year). 14) With effect from 1 February 2012, entry grade C3 will require completed or on-going track recordof $100,000 for new, renewal and upgrading applications. For companies with insufficient track record, an interview with the technical personnel (conducted at BCA office) will be required.
**For renewal cases of grades A1 to C2, projects completed satisfactorily in the past 5 years including on-going projects and recently awarded projects will be considered as track record. For CW02-A1 registration, projects completed satisfactorily in the past 5 years can be considered as track record. For evaluation of overseas projects and financial accounts, BCA may send its officers to the respective countries for further verification. All flight and accommodation expenses shall be fully borne by the applicant. In June 2006, BCA adopted a credit rating system to indicate the financial standing of larger construction firmsin its Contractors Registry. The adopted credit ratingsystem is similar to one developed by credit and business information bureau DP Information Group to assess thefinancial health of companies. However, the BCA system applies only to the larger construction companies (i.e. those in the top categories of A1, A2 and B1). Government agencies will use the DP credit rating as an additional reference on the financial standing of the firms when evaluating public tenders.
CURRENT CONSTRUCTION REGULATIONS New Tendering Limits for BCA Registered Contractors In 2002, BCA launched a Tender Limit VariableComponent (TLVC) to the tender limits of all registration grades in the Contractors Registry System (CRS). TLVC is determined using the Tender Price Index (TPI) to reflect the impact of tender price movements on project value. Over the years, the TPI has moved up significantly, hence resulting a need to adjust the tender limits of the various CRS registration grades to better reflect the fluctuations in the construction costs in the market. In November 2007, BCA announced that the tendering limits will be adjusted once a year on the first of July. The current new tendering limits shown below are based on the latest TLVC updated on 23 May 2011. CONSTRUCTION WORKHEADS (CW01 & 02)
A1
A2
B1
B2
C1
C2
C3
Tendering limit ($million) 1 Jul 10 to 30 Jun 11
Unlimited
85.0
40.0
13.0
4.0
1.3
0.65
Tendering limit ($million) 1 Jun 11 to 30 Jun 12
Unlimited
85.0
40.0
13.0
4.0
1.3
0.65
L6
L5
L4
L3
L2
L1
Tendering limit ($million) 1 Jul 10 to 30 Jun 11
Unlimited
13.0
6.5
4.0
1.3
0.65
Tendering limit ($million) 1 Jul 11 to 30 Jun 12
Unlimited
13.0
6.5
4.0
1.3
0.65
SPECIALIST WORKHEADS (CR, ME, MW & SY)
Source: Building and Construction Authority as at 23 May 2011
CURRENT CONSTRUCTION REGULATIONS Man-Year Entitlement (MYE) The Man-Year Entitlement (MYE) system is a work permit allocation system implemented by the Ministry of Manpower (MOM) in April 1998. Under this system, main contractors are given entitlements to employ foreign workers from Non-Traditional Sources and the People’s Republic of China either directly or indirectly from their sub-contractors based on the nature and value of their projects. To reduce the construction industry’s heavy reliance on foreign workers and to raise the productivity levels, MOM has been tightening the MYE formula so as to meet the Construction 21 (C21) targets for MYE to be further reduced to 70% of 1999-level by 2005 and eventually to 50% of 1999-level by 2010, or earlier. In line with the C21 blueprint, MOM has since implemented MYE cuts/adjustments as follows: June 2002 • 70% of 1998 MYE level for all upgrading projects • 80% of 1998 MYE level for all civil engineering projects • 65% of 1998 MYE level for all building projects below S$10 million • 60% of 1998 MYE level for all building projects at or above S$10 million December 2004 • Based on the feedback given by the industry, MYE allocation was increased by 10% of 2002 MYE level for all new and ongoing construction projects January 2007 • 5% reduction from 2004 MYE level for all projects except for projects above $100 million April 2007 • 5% restoration of January 2007 MYE level for all new and ongoing projects except for projects above $100 million In March 2010, the Singapore Government made an announcement that, with effect from 1 July 2010, there will be progressive reduction in the MYE in phases, leading to a cumulative 25% cut in MYE allocation by July 2012, details as follows: • Reduce MYE by 25% over 3 phases - 1 July 2010 = 5% - 1 July 2011 = 10% - 1 July 2012 = 10% The tabulation below illustrates the MYE allocation for different project values applied during the respective periods:
PROJECT VALUE
BUILDING PROJECTS
UPGRADING PROJECTS
CIVIL ENGINEERING PROJECTS
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
BETWEEN 1 JUL 10 AND 30 JUN 11
AFTER 1 JUL 11
$400,000
0
0
0
0
0
0
$600,000
12
11
18
16
5
5
$7,000,000
94
84
126
113
38
35
$15,000,000
158
142
229
206
70
63
$25,500,000
237
213
345
310
105
95
$35,000,000
296
266
430
387
129
116
$140,000,000
772
695
1,081
973
237 at least*
214 at least*
Source: Ministry of Manpower as at 1 July 2011 *For CE Projects with contract value above $100 million, the MYE are to be decided on a case-by-case basis.
The Government have made an announcement on 21 February 2011 that there will be a further 15% cut in the MYE quota for new projects in July 2013.
CURRENT CONSTRUCTION REGULATIONS Minimum Buildable Design Score The legislation on buildability came into effect on 1 January 2001. Projects submitted for planning after 1 January 2001 will be affected by the legislation and are required to comply with a minimum buildable design score as stipulated in the Code of Practice on Buildability. Over the years, the minimum buildability scores have been progressively raised. In September 2005, all new building projects with gross floor area equal or greater than 2,000m2 are required to comply with the minimum buildability score. The minimum buildability score requirement shall also apply to A&A work to an existing building if the building works involve the construction of new floor and/or reconstruction of existing floor for which their total gross floor area is 2,000m2 or more. The Code of Practice on Buildability (April 2011) has stipulated the minimum buildable design score for building works with applications for planning permission made on or after 15 July 2011 for different building types: CATEGORY OF BUILDING WORK / DEVELOPMENT Residential (landed) Residential (non-landed) Commercial Industrial School Institutional and Others
MINIMUM BUILDABLE DESIGN SCORE 2,000m2 ≤ GFA < 5,000m2 60
5,000m2 ≤ GFA < 25,000m2 65
GFA ≥ 25,000m2 68
57 (for A&A work within existing building) 67
72
75
60 (for A&A work within existing building) 69
74
77
62 (for A&A work within existing building) 69
74
77
62 (for A&A work within existing building) 64
69
72
60 (for A&A work within existing building) 60
66
69
60 (for A&A work within existing building)
Source: Building and Construction Authority
CURRENT CONSTRUCTION REGULATIONS Constructability Score To steer the construction industry towards higher level of productivity, the Building and Construction Authority (BCA) would be tightening the existing BuildabilityFramework and mandating a new component called Constructability Score. In this connection, contractors would be expected to adopt more labour-efficient construction methods or technologies. The constructability requirement would apply to all planning permissions submitted on and after 15 July 2011. This extends to all new building works and projects involving repairs and Addition & Alteration Works to existing buildings with GFA of 5,000m2 or more. The Constructability Score of a project is made up of 3 parts :• Part A – Maximum of 60 points for Structural System. Points are awarded for various methods and technologies adopted during the construction of structural works • Part B – Maximum of 50 points for Architectural, Mechanical, Electrical and Plumbing (AMEP) Systems. Points are awarded for various methods and technologies adopted during the construction of AMEP works • Part C – Maximum of 10 points for Good Industry Practices. Points are awarded for good industry practices adopted on site to improve productivity Under the BCA’s Code of Buildability (April 2011), the minimum Constructability Score requirements and minimum score under the Structural System component are allocated as follows: CATEGORY OF BUILDING WORK / DEVELOPMENT
MINIMUM CONSTRUCTABILITY SCORE 5,000m2 ≤ GFA < 25,000m2
GFA ≥ 25,000m2
Residential (landed) Residential (non-landed) Commercial Industrial
40 (Minimum 25 points from Structural System)
School Institutional and Others
Source: Building and Construction Authority
50 (Minimum 35 points from Structural System)
CURRENT CONSTRUCTION REGULATIONS Earth Control Measures Public Utilities Board (PUB) has amended its Code of Practices on Surface Water Drainage* to provide comprehensive guidelines on how the industry can apply more effective erosion and sedimentation control measures, this came into force in October 2006. The Code of Practice on Surface Water Drainage contains information pertaining to the basic planning, design and procedural requirements for surface water drainage, and specifies the minimum engineering requirements for the provision of functional facilities for surface water drainage. This Code of Practice is issued under Section 32 of the Sewerage and Drainage Act (Chapter 294). As part of our commitment of excellent service to our clients, DLS has responded to the amendments with changes in our contractual clauses and front-end documents. *Code of Practice on Surface Water Drainage (Fifth Edition – with amendments under Addendum No. 4 – September 2006)
CURRENT CONSTRUCTION REGULATIONS Building Control Act (Chapter 29) The salient features incorporating the (Amendment) Act 2007 are highlighted below:
Building
Control
Require Site Supervision Teams to ensure adequate Supervision of Structural Works Under this new requirement, both the Qualified Person (QP) and the Builder are required to provide their own supervision team. The actual number and compositions of the supervision team will depend on the project costas prescribed in the Regulations. Appointment ofsupervision teams will be required for projects where the first application for a permit is made on or after the effective date of the Act. While this supervision team does not apply to projects which had already obtained a permit earlier, QPs are nonetheless encouraged to adopt the supervision team where necessary. Strict Regulation on Major Geotechnical Works The Act imposes more stringent regulation of major underground building works that have significant safety impact, in particular on the design of Earth Retaining or Stabilising Structures (ERSS) in excavations. The Act stipulates that the design of such ERSS be carried out by a Registered Professional Engineer (PE) and reviewed by a Registered Accredited Checker (AC). A PE is also required to supervise the construction of ERSS. In addition, the geotechnical aspects of major under-ground building works including ERSS in excavations more than 6m deep, will also require the inputs from PEs and ACs who are specialists in geotechnical engineering. Appointment of Instrumentation Specialist Builder (ISB) The Developer of the building works shall appoint a Specialist Builder to monitor instruments measuring pore pressures for saturated and unsaturated levels, ground water levels and ground movements or building movements where the building works comprise wholly or partly of any underground building works. Underground building works generally mean thefollowing: • A tunnel with a diameter or height of more than 2 metres • Excavation with a depth of more than 6 metres • Foundation works for buildings of 30 or more storeys high Any of the above case would require the appointment of an ISB and the Act stipulates that the appointment shall be made by the Developer. Licensing of Builders This is a licensing scheme to set minimum standards of professionalism for general builders and six selective specialist builders whose works have significant safety impact.
To be licensed, builders must be financially sound, have good safety records and appoint key personnel with suitable qualifications and experience to manage the firm and supervise the construction works. The licensing of builders came into effect on 16 December 2008. There was a grace period of six months (till 16 June 2009) for builders to apply for the licence. There are two types of licence – the General Builder licence and the Specialist Builder licence. After 16 June 2009, all builders who had been granted or to be granted a permit to carry out general building works, as well as builders carrying out work in the six selective specialists work areas must possess a licence issued by the Commissioner of Building Control. With effect from 15 April 2011, BCA has increased the number of key construction trades under CoreTrade from seven (7) to seventeen (17) to enable the building up of a larger pool of higher skilled and experienced workers. In addition, the following shall apply to construction projects for which the permits to commence structural works are submitted to BCA from 15 October 2011 :• There will be 4 project categories (instead of 3) under CoreTrade, in recognition of the distinct manpower needs of “conventional” Civil Engineering (CE) works and CE works involving MRT stations: - New Building Works - Addition & Alteration (A&A) Works - Civil Engineering Works (General) - Civil Engineering Works (MRT Station) • Increasing the CoreTrade Man-Year deployment requirements Class 1: Unlimited
Paid up capital: Not less than $300,000
LICENSING OF BUILDERS General Builders
Specialist Builders
Class 2: $6mil limit
Paid up capital: Not less than $25,000
Approved Person
Notes:1. Class 1 Builders with project contract value of more than $20mil have to submit to the Commissioner of Building Control a manpower program showing the deployment of CoreTrade personnel for the duration of the project.
2. Deployment requirements for 3 classes of projects:a. New Building Works b. A&A Works c. Civil Engineering Works (General) d. Civil Engineering Works (MRT Station)
Commence 16 Dec 08
Technical Controller
Six Categories 1. Piling Works 2. Ground Works 3. Site Investigation Works 4. Structural Steelworks 5. Pre-cast Concrete Works 6. In-situ Post-tensioning Works Criteria 1. Sole Proprietor 2. Partner 3. Director
CORETRADE Tradesmen 1. Construction Plant Operation Works 2. Electrical Works 3. Plumbing & Piping Works 4. Tiling, Stone Laying & Floor Finishing Works 5. Reinfored Concrete Works 6. Structural Steelworks 7. Waterproofing Works 8. Cladding & Curtain Wall Installation 9. Glazing Works 10. Drywall Installation 11. Suspended Ceiling Installation 12. Doors & Windows Installation 13. Joinery Works 14. Air-con Ducting Installation 15. Fire Protection Works 16. Gas Pipefitting Works 17. Lift Installation
Implementation Phase
Trade Foremen 1. Electrical Works 2. Plumbing & Piping Works 3. Tiling, Stone Laying & Floor Finishing Works 4. Waterproofing Works 5. Reinfored Concrete Works 6. Structural Steelworks 7. Waterproofing Works 8. Cladding & Curtain Wall Installation 9. Glazing Works 10. Drywall Installation 11. Suspended Ceiling Installation 12. Doors & Windows Installation 13. Joinery Works 14. Air-con Ducting Installation 15. Fire Protection Works 16. Gas Pipefitting Works 17. Lift Installation
Transition Phase till 16 Jun 09
• Administrative expenses • Legal costs and disbursements • Demolition of existing building/s • Furniture, fittings and equipment (F.F. & E.) (unless otherwise stated) • Operating equipment • Cost escalation • Goods and Services Tax The codes and standards for each category of building vary from country to country and do not necessarily follow those of Singapore.
Registration of CoreTrade Personnel With effect from 16 June 2009, all Class 1 General Builders* undertaking a project of value which is $20 million or more will be required to deploy a prescribed minimum number of construction personnel who are registered under the CoreTrade Scheme. The objective of this new requirement is to build up a core group of locals and experienced foreign workers in key construction trades to anchor and lead the workforce. *Class 1 General Builder licence allows the holder to carry on the business of a general builder for any project. Enhance Independence of Parties in Construction Projects To avoid any situations of conflicts on interest, the Act imposes restrictions to insulate the QP and Contractor supervising the structural works from the influence of the developer or builder by requiring that the QP responsible for supervision should not be associated with the developer or builder. Standards on Environmental Sustainability Please refer to Page 147 for details .Maintenance of Barrier-Free Provisions Please refer to Page 162 for details. Stiffer Penalties for Non-Compliance The penalties provided in the new Act are set at a higher level than those found in the previous Act in order to align them with the relevant provisions of the Workplace Safety and Health Act (WSHA). Statutory Duty on Developers to Report AnyContravention of the Building Control Act and Regulations to the Commissioner of Building Control(CBC) Under the Act, the developer, who is one of the key parties in the project, has a duty to report to the CBCof any contravention of the Building Control Act/Regulations relating to the project that he knows or ought reasonably to know. Mandatory Higher Green Mark Standard forGovernment Land Sales (GLS) Sites in Selected Strategic Areas It was announced in BCA’s 2nd Green Building Master-plan in 2009 that projects developed on GLS sites in the selected strategic growth areas will be subject to higher Green Mark standards. This requirement aims to maximize the potential for cost-effective energy savings in our built environment. Any new development located on land sold on or after 5 May 2010 under the GLS Programme in the following strategic areas will be required to be designed to meet the prescribed Green Mark certification:
SELECTED STRATEGIC AREAS REQUIREMENTS FOR BUILDING WHOLLY Exact Location to refer to the Building OR PARTLY WITHIN AREA THAT IS ON Control (Environmental Sustainability) LAND SOLD UNDER THE GLS Regulations 2008 PROGRAMME Marina Bay
Green Mark Platinum
Downtown Core – including areas within the CBD located next to Marina Bay Jurong Lake District
Green Mark GoldPLUS
Kallang Riverside Paya Lebar Central
Source: Building and Construction Authority as at 10 December 2010 For building works that are subject to this requirement, the QPs need not submit their declaration of the Green Mark scores along with the building plan submission. Instead, the QPs should ensure that, prior to the building plan submission, an application is made to BCA for the project to obtain the Green Mark Certification in accordance with the BCA Green Mark Certification Standard for New Buildings. Upon completion of the building works, the QPs should submit the Green Mark Certification rating achieved for the project along withhis application for Temporary Occupation Permit(TOP) or Certificate of Statutory Completion (CSC).The prescribed Green Mark Certification rating for the building has to be obtained before a TOP/CSC can be granted. The certification standard has been revised from 1 December 2010 in tandem with the changes in the Green Mark Criteria. The compliance with the respective certification standards will be based on the tender award letter issued by the Urban Redevelopment Authority (URA) to the successful developer under the GLS Programmes for the selected strategic areas and as stated in the table below: DATE OF TENDER CLOSED UNDER THE GLS PROGRAMMES
COMPLIANCE STANDARD
From 5 May 2010 to 30 November 2010
BCA Green Mark Certification Standards for New Building, GM Version 3.0, May 2010 issue
From 1 December 2010 and onwards
BCA Green Mark Certification Standards for New Building, GM Version 4.0, August 2010 issue
Source: Building and Construction Authority as at 10 December 2010 Green Mark Version 4.0 for New Buildings On 31 August 2010, BCA announced that the Green Mark (GM) Criteria will be revised to raise the standards of environmentally friendly buildings in Singapore. This is a step forward in achieving the target of “greening” 80% of the existing buildings stock by 2030. The revised BCA GM Criteria for new buildings (Version 4.0) will be implemented with effect from 1 December 2010. Some of the key changes include enhance pre-requisites for higher GM rating, increase in focuson passive designs, sustainable construction practices, introduction of carbon footprint and a minimum 10% energy improvement as compared to Version 3.0.
An extract on the implementation timelines of BCA GM Criteria Version 4.0 in other green building initiatives are outlined in the table below: GREEN BUILDING INITIATIVES
IMPLEMENTATION TIMELINE
Government Land Sales (GLS) Programmes
Based on the GLS tender close date.
Green Mark Gross Floor Area (GM-GFA) Incentive Scheme
Based on the submission date of BCAGM-GFA application.
Projects with tender closing date on or after Any new development located on land sold 1 December 2010 will be assessed and under the GLS are required to attain Green certified using the Revised BCA Green Mark Mark GoldPLUS or Platinum Rating. Criteria for new buildings (GM Version 4.0).
Incentives in the form of additional GFA can Projects with applications submitted on or be granted by URA if development attains after 1 December 2010 will be assessed and certified using the Revised BCA Green Green Mark GoldPLUS or Platinum Rating. Mark Criteria for new buildings (GM Version 4.0). Public Sector Taking the Lead
Based on the date of tender notices for the consultancy or design and build contract.
New public sector buildings with more than 5,000m2 air-conditioned floor area are The revised BCA Green Mark Criteria for required to attain the Green Mark Platinum new buildings (GM Version 4.0) will be applicable to public sector projects with Rating. tenders for design that are called on or after 1 December 2010.
Source: Building and Construction Authority’s Circular dated 31 August 2010
More information on the Revised BCA Green Mark Criteria for New Buildings (Version 4.0) can be found in BCA’s website. (http://210.23.8.172/einfo/Uploads/Circular/CBCA100902.pdf)
CURRENT CONSTRUCTION REGULATIONS Green Mark Incentive Scheme for Existing Building (GMISEB) GMIS-EB was introduced by BCA in April 2009. The Scheme aims to encourage private building owners to undertake improvements and/or retrofits to their existing buildings to achieve substantial improvement in energy efficiency. It provides a cash incentive that co-funds up to 35% (capped at $1.5 million) of the costs of energy efficient equipment installed for energy efficiency improvement in their existing buildings. In addition, it will also co-funds up to 50% of the cost for conducting a energy audit (Health Check scheme) on the efficiency of the air-conditioning plants. All building owners of private existing non-residential buildings with gross floor area of 2,000m2 and above with central chilled water air-conditioning plants or which will be graded to have central chilled water air-conditioning plants are eligible for application of the incentive. However, the eligible buildings must first achieve at least BCA Green Mark Certified rating and air-conditioning system efficiency of 0.7 kW/RT or better, with 15% energy savings or higher. The amount of co-funding for building owners will vary depending on the Green Mark rating, air-conditioning system efficiency and energy savings that are achieved. The amount of co-funding rate and cap amount are summarised as follow: GREEN MARK RATING
Certified Gold
AIRCON SYSTEM EFFICIENCY (KW/RT)
0.70
ENERGY SAVINGS
CO-FUNDING RATE BASED ON BASED ON (BASED ON TOTAL TOTAL EQUIPMENT BUILDING LANDLORD’S COST) CONSUMPTION CONSUMPTION 20%
25%
15%
20%
CAP
20%
$150,000
GoldPLUS
0.65
30%
35%
30%
$500,000
Platinum
0.60
35%
40%
35%
$1,500,000
Source: Building and Construction Authority as at 11 July 2011 The cash incentives will be disbursed in two stages. The first disbursement, set at 50% of the approved co-funding, will be given out upon completion of the energy improvement retrofits. The final disbursement of the approved co-funding will be given out upon Green Mark certification and verification of airconditioning plant system efficiency and the energy savings achieved. The scheme is applicable with effect from 29 April 2009 and will expire 5 years later on the 28 April 2014 or when the GMIS-EB fund is fully disbursed, whichever earlier. Participation in the scheme will be on a first-come-first served basis, subject to availability of funds. For more information on the Scheme, please refer to BCA’s website for more details.
Green Mark Gross Floor Area (GM GFA) Incentive Scheme The Green Mark Gross Floor Area (GM GFA) Incentive Scheme came into effect on 29 April 2009 for a periodof 5 years with a mid-term review after 2 years ofimplementation. The Scheme was introduced toencourage building owners/developers to acceleratethe adoption of environmental-friendly green building technologies and building design practices that will contribute to the sustainable development of Singapore. Building owners/developers can enjoy additional GFA allowed over and above the Master Plan (MP) Gross Plot Ratio (GPR) should their buildings achieve GM ratings of GoldPLUS and above. The quantum of GM GFA allowed under the Scheme is up to 1% for Green Mark GoldPLUS and up to 2% for Green Mark Platinum, subject to a cap of 2,500m2 for GoldPLUS and 5,000m2 for Platinum. Development that are eligible for the GM GFA Incentive Scheme includes: • Residential – non-landed, mixed commercial and residential development and others (approved on a case-by-case basis) • Non-Residential – commercial, office, retail, business parks, industrial, institutional, community building, hotel, hospital, white site development and others (approved on a case-by-case basis) • New private developments, redevelopments and reconstruction developments which includes major additions and alterations to existing buildings and major retrofitting to existing buildings as deemed suitable for the GM GFA incentive scheme at BCA’s sole discretion • Government Land Sales (GLS) sites, except for sites in which GM Platinum or GoldPLUS standards are mandated as part of the sales condition. For sites where the GoldPLUS standard is mandated, the developer will still enjoy an incremental GFA incentive if the developer attained the higher GM Platinum standard • Applicants who take up the GM GFA Incentive Scheme will not be eligible for the GMISThe method of determining the GM GFA is based on the following:
Equivalent Bonus GFA
Proposed GFA (sqm) = (subject to MP allowable intensity)
X
Prescribed Green Premium ($/sqm)
Land Value ($/sqm) (determined by proxy using DC rates) Note: The additional GFA is subject to payment of differential premium or development charge, whichever is applicable. For more information on the Scheme, please refer to BCA’s website for more details.
CURRENT CONSTRUCTION REGULATIONS Legislation on Environmental Sustainability for Buildings Since the launch of BCA Green Mark Scheme in 2005, BCA has enhanced the Building Control Act to include a minimum environmental sustainability standard that is equivalent to the Green Mark Certified Level for new buildings and existing ones that undergo major retrofitting. The Building Control (Environmental Sustainability) Regulations 2008 stipulates a minimum Green Mark score of 50 for affected building works. It applies to: • All new building works with Gross Floor Area of 2,000m2 or more • Additions or extensions to existing buildings which involve increasing Gross Floor Area of the existing buildings by 2,000m2 or more • Building works which involve major retrofitting to existing buildings with existing Gross Floor Area of 2,000m2 or more Alterations to existing buildings which does not involve major retrofitting works is not subject to the new requirements. The effective date of implementation will be based on the first submission date for URA Planning Permission on or after 15 April 2008. With effect from 1 December 2010, the minimumenvironmental sustainability standard has been revised. The compliance with the respective environmental sustainability standards will be based on the firstsubmission date for URA planning permission as stated in the table below:
1ST SUBMISSION DATE FOR URA PLANNING PERMISSION From 15 April 2008 to 30 November 2010 From 1 December 2010 onwards
COMPLIANCE STANDARD Code for Environmental Sustainability for Buildings, 1st Edition, April 2008 issue Code for Environmental Sustainability for Buildings, 2nd Edition, August 2010 issue
The requirements on environmental sustainability of buildings will be integrated with the Building Plan process. The Qualified Person (QP) who submits the Building Plan and the other appropriate practitioners will be responsible for assessing and scoring the building works under their charge using the criteria and scoring methodology spelled out in the Code for Environmental Sustainability of Buildings. Under the Legislation, Green Mark assessments are no longer required to be conducted as an independent third party certification. Compliance to the regulations will be based on QP’s declaration and random audit and site checks prior or during Temporary Occupation Permit (TOP).
However, third party assessment by BCA will be conducted to award projects with Green Mark Gold rating and above. The BCA Green Mark has assessment criteria for three main categories: • New Buildings • Existing Buildings and • Beyond Buildings New buildings refer to new developments,redevelopments, additions and alterations to existing buildings and major retrofitting to existing buildings. Existing buildings refer to buildings under operations with no significant retrofitting works. Lastly, beyond buildings refer to new parks design and development, existing parks, office interiors, infrastructure with no significant retrofitting works and district development. In line with the above new regulations, the BCA Green Mark Assessment Criteria for New Buildings has been revised and will take effect from 1 December 2010 onwards. All Green Mark applications for new buildings that are submitted on or after this date will be assessed and certified based on this new version. Append hereunder are the various Green Mark categories: • BCA Green Mark for Non-Residential New Buildings (Version NRB/4.0) Applicable for new buildings such as offices, commercial, industrial and institutional buildings with or without airconditioning systems. • BCA Green Mark for Residential New Buildings (Version RB/4.0) Applicable for new private and public residential developments. • BCA Green Mark for Non-Residential Existing Buildings (Version NREB/2.1) Applicable to existing commercial, industrial and institutional buildings under operation. • BCA Green Mark for Existing Residential Buildings (Version ERB/1.0) Applicable for existing private and public residential developments. • BCA Green Mark for Existing Schools (Version ES/1.0) Applicable to Ministry of Education main stream schools (excluding International schools, Universities and Institute of Higher Learning: Polytechnics and Institute of Technical Education.) • BCA Green Mark for Office Interior (Version 1.0) Applicable for tenant renovation and maintenance practices. • BCA Green Mark for Landed Houses (Version LH/1.0) Applicable for landed housing projects. • BCA Green Mark for Infrastructure (Version 1.0) Applicable for infrastructure projects (e.g. barrages, roads, bridges, etc.) • BCA Green Mark for District (Version 1.0) Applicable for district projects. • BCA Green Mark for Restaurants (Version 1.0) Applicable for restaurants.
The Green Mark rates the environmental friendliness of a building based on a point scoring approach. Depending on the score, the rating is categorized in four levels – Platinum, GoldPLUS, Gold and Certified GREEN MARK RATING
GREEN MARK POINTS GREEN MARK POINTS WITH EFFECT FROM WITH EFFECT FROM 1 DECEMBER 2010 1 DECEMBER 2009 VERSION 4.0 VERSION 2.1 NON-RESIDENTIAL & NON-RESIDENTIAL RESIDENTIAL BUILDINGS EXISTING BUILDINGS
Green Mark Platinum
90 and above
90 and above
Green Mark GoldPLUS
85 to <90
85 to <90
Green Mark Gold
75 to <85
75 to <85
Green Mark Certified
50 to <75
50 to <75
GREEN MARK RATING
GREEN MARK POINTS GREEN MARK POINTS WITH EFFECT FROM WITH EFFECT FROM 19 MAY 2011 4 AUGUST 2011 VERSION 1.0 VERSION 1.0 EXISTING RESIDENTIAL EXISTING SCHOOLS BUILDINGS
Green Mark Platinum
90 and above
90 and above
Green Mark GoldPLUS
85 to <90
85 to <90
Green Mark Gold
75 to <85
75 to <85
Green Mark Certified
50 to <75
50 to <75
GREEN MARK POINTS WITH EFFECT FROM 27 MAY 2009 VERSION 1.0 OFFICE INTERIOR & LANDED HOUSES
GREEN MARK POINTS WITH EFFECT FROM 27 MAY 2009 VERSION 1.0 INFRASTRUCTURE
GREEN MARK RATING
Green Mark Platinum
95 and above
90 and above
Green Mark GoldPLUS
85 to <95
80 to <90
Green Mark Gold
75 to <85
70 to <80
Green Mark Certified
50 to <75
50 to <70
GREEN MARK RATING
GREEN MARK POINTS WITH EFFECT FROM 29 OCTOBER 2009 VERSION 1.0 DISTRICT
PRE-REQUISITES
Green Mark Platinum
90 and above
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark Platinum
Green Mark GoldPLUS
80 to <90
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark GoldPLUS
Green Mark Gold
65 to <80
At least one building (GFA > 5,000m2) at Phase I to achieve Green Mark Gold
Green Mark Certified
50 to <65
Nil
GREEN MARK RATING
Green Mark Platinum
GREEN MARK POINTS WITH EFFECT FROM 12 SEPTEMBER 2011 VERSION 1.0 RESTAURANTS 95 and above
Green Mark Gold
85 to <95
Green Mark Gold
75 to <85
Green Mark Certified
50 to <75
PLUS
More information on the BCA Green Mark Scheme can be found in BCA’s website. (http://www.bca.gov.sg/GreenMark/green_ mark_buildings.html)
CURRENT CONSTRUCTION REGULATIONS BCA Green Mark Champion The Green Mark Champion Award established in May 2008 was an extension to the BCA Green Mark Award introduced in 2005. This new award was created to recognize developers/building owners with strong commitment towards corporate social responsibility and outstanding achievements in environmental sustainability. It is given to developers/building owners who achieve a substantial number of Green Mark buildings at Gold level and higher. There are 2 categories for the award: • BCA Green Mark Champion • BCA Green Mark Platinum Champion In addition to demonstrating strong commitment towards corporate social responsibility and environmentalsustainability, developers/building owners must also meet the minimum criteria set out below to qualify for the award:
TOTAL NO. OF BUILDINGS RATED
BCA GREEN MARK BCA GREEN MARK CHAMPION PLATINUM CHAMPION
Green Mark Gold and above
At least 10
At least 50
Green Mark GoldPLUS
At least 3
At least 15
Green Mark Platinum
At least 3
At least 15
Source: Building and Construction Authority
CURRENT CONSTRUCTION REGULATIONS Solar Capability Scheme (SCS) In May 2008, the Clean Energy Programme Office (CEPO) (now known as Energy Innovation Programme Office (EIPO)) of the Singapore Economic Development Board (EDB) announced the establishment of the SolarCapability Scheme (SCS). The primary purpose of this scheme is to encourage the use of solar energy systems in new developments, and also to build capacity within the local construction industry for the implementation of such systems. Under the scheme, building owners and developers may enjoy a grant of 30% - 40% of the capital cost (capped at $1 million per project) of installing solar energy systems in their new developments. It is estimated that savings from the electricity generated by these systems will allow the owner to recover a further 50% of the capital cost incurred. The initial budget for the scheme is $20 million, and the quantum of grant is expected to be reviewed on a regular basis to factor in changes in the prices of solar systems and energy prices. Eligibility for the SCS is restricted to new buildings that have attained a minimum Green Mark Gold standard (administered by the Building and ConstructionAuthority), while buildings undergoing extensive retrofit will be considered on a case-by-case basis. To qualify, a minimum system size of 10kWp is required. The following evaluation criteria determine the actual amount of the grant: a) Innovation - Innovative application of solar technologies - New products, technologies or solutions developed b) Design - Aesthetics of building and solar system design and integration - Integration of solar technologies in the building's sub-system c) Effectiveness - Cost effectiveness of solar solutions - Percentage of conventional electricity replaced d) Skill Development - Number of man-months of Singapore based staff involved in solar related activities in the project - Number of man-months of formal training Disbursement of the grant is conducted in 2 phases as follows: i. Capital Component: 70% of the grant to be disbursed from the start of the project on a reimbursement basis ii. Performance Component: 30% of the grant to be disbursed 2 years after the system becomes operational, subject to the project meeting submitted plans, including stipulated electricity output
CONSTRUCTION COSTS FOR SINGAPORE OVERALL COST TYPES
LOW S$/m2
HIGH S$/m2
Terraced Houses
2,400
2,650
Semi-Detached Houses
2,550
3,000
Detached Houses
3,000
4,000
Average Standard Condominium
1,850
2,100
Mid Range Condominum
2,100
2,800
Luxury Condominium
2,800
4,200
Average Standard Offices
2,400
2,600
Prestige Offices
2,600
2,900
Shopping Centres, Average Quality
2,600
2,800
Shopping Centres, High Quality
2,800
3,100
Theatres / Cinemas
1,950
2,200
900
1,300
1,300
1,750
Flatted Light Industrial Buildings
1,250
1,400
Flatted Heavy Industrial Buildings
1,400
1,850
Single Storey Industrial Buildings
1,150
1,300
Flatted Warehouses
1,150
1,300
Single Storey Warehouses
1,000
1,300
Resort Hotels
2,850
3,100
3-Star Hotels
2,950
3,200
4-Star Hotels
3,100
3,700
5-Star Hotels
3,750
4,300
Serviced Apartments
2,200
2,850
Private Hospitals
3,750
3,950
Polyclinics
1,550
1,750
Nursing Homes
1,550
1,850
Medical Centres
2,900
3,100
RESIDENTIAL
OFFICE
COMMERCIAL
CAR PARKS Multi-Storey Car Parks Basement Car Parks INDUSTRIAL
HOTEL (Including F.F. & E.)
HEALTH
The above costs are at 4th Quarter 2011 levels. .
With effect from 1 March 2010, the eligibility for the SCS has been revised as follows: a) SCS will offset up to 30% of the total capital cost instead of 30% - 40% of the capital cost b) New buildings have to attained minimum Green Mark GoldPLUS standard instead of Green Mark Gold standard c) Minimum system size of 50kWp is required instead of 10kWp
CURRENT CONSTRUCTION REGULATIONS Revised Strata Landed Housing Guidelines –Allowable Number of Units per Development With effect from 3 February 2009, the maximum number of allowable units in strata landed housing developments will be capped based on a minimum plot size per unit for the respective conventional landed housing form. Under the new guidelines, the maximum number ofunits allowed for strata landed housing developmentscomprising only 1 type of housing form will be determined by the following formula: Number of Allowable Units 1
≤
Total Site Area of Development Y
Where Y = plot size control for the relevant landed housing form 2 The maximum number of units allowed for mixed strata landed housing developments comprising more than 1 type of landed housing form will be determined by the following formula: (B x YB) + (SD x YS) + (T x YT) ≤ Total Site Area of Development Where, B = proposed number of strata bungalow units SD = proposed number of strata semi-detached house units T = proposed number of strata terraced house units YB,YS,YT = plot size control for the relevant landed housing form2 Note: Development applications (excluding Outline applications) submitted prior to 3 February 2009 which results in a Provisional Permission will continue to be evaluated under the old guidelines 1 Where the formula does not result in a round number, the number of allowable units will be rounded down to cater for each unit having the minimum plot size for the proposed housing form 2 Y = 400 sqm for Bungalow; Y = 200 sqm for Semi-detached house; Y = 150 B S T sqm for Terraced house
CURRENT CONSTRUCTION REGULATIONS Changes to Gross Floor Area (GFA) Exemption Guidelines – GFA to include i. Bay windows in all developments; and ii. Planter boxes within a residential unit. With effect from 1 January 2009, bay windows in all developments and planter boxes within a residential unit are no longer exempted from GFA calculations. This new guidelines do not apply to approved developments and formal development applications (excluding Outline Applications) with a valid Provisional Permission (PP) issued prior to the effective date. For approveddevelopments with approved bay windows and planter boxes exempted from GFA, these approved spaces will remain as GFA exempted until the buildings areredeveloped. The changes are summarised as follows:
OLD GUIDELINES GFA exemption apply to:
NEW GUIDELINES (WITH EFFECT FROM 1 JANUARY 2009) GFA exemption rescinded for:
• Bay windows
• Bay windows in all developments
• Planter boxes
• Planter boxes within a residential unit
GFA exemption continue to apply to:
• Planter boxes provided within non-residential developments
• Planter boxes provided within the communal areas of residential developments
Source: Urban Redevelopment Authority
CURRENT CONSTRUCTION REGULATIONS Building and Construction Industry Security of Payment Act 2004 The Building and Construction Industry Security of Payment Act (BCISOP Act) 2004 came into force in Singapore on 1 April 2005. The BCISOP Act was enacted to facilitate payments for construction work done or for related goods and servicessupplied, under a contract in the building and construction industry. The Act covers quite a wide spectrum of services within the construction industry relating to construction work which includes professionalconsultancy services. The underlining objectives of the BCISOP Act are to: • improve cash flow by expediting payment • provide a statutory entitlement to progress payments to contractors, sub-contractors and suppliers for work carried out, even if no such entitlement is provided in their contract • provide a procedure of adjudication to claim payment; which is intended to be a more cost and time efficient way of resolving disputes on payment claims between the parties • provide remedies when adjudicated amount not paid The BCISOP Act provides a new regime of claim,adjudication and enforcement procedures which include the right to suspend work for non-payment. It also renders unenforceable “pay when paid” provisions in contracts. This benefits the sub-contractors and suppliers. The BCISOP Act is supplemented by the BCISOP Regulations 2005 where the Act confers power onthe Minister of National Development to set out theregulations to facilitate the implementation of the Act. However, the BCISOP Act is not applicable toconstruction work and goods and services relating to residential property (defined under Residential Property Act) not requiring approval under the BCA Building Control Act, construction work carried outside Singapore, goods and services supplied to construction work outside Singapore and employment contracts. Notwithstanding the benefits arising from the enactment of the BCISOP Act to facilitate payment in theconstruction supply chain, it is essential for every player in the industry to have a good understanding of the Act from the operational and practical standpoint. DLS has streamlined our in-house practices as well as assisted our Clients/Developer organizations to review and make recommendations in their internal operating procedures. Payment protocol with prescribed timeframe for payment claim, QS valuation, consultant’scertification, payment response and payment termwere customized and established with the respective organization.
CURRENT CONSTRUCTION REGULATIONS Workplace Safety and Health Act (WSHA) The Workplace Safety and Health Act (WSHA)considers the safety, health and welfare of the personsat workplaces. It imposes specific duties on variouspersons (including Employer). It also provides a rangeof enforcement methods so as to enable appropriate response to a failure to comply with the Act, depending on the nature of the failure. This Act will replace the current Factories Act, which stipulates that the legal liability for safety and health in a factory lies primarily with the factory occupier. The following incidents in year 2004 have shown a need for a better work safety standard: • The Nicoll Highway collapse • The construction site accident at Fusionpolis • The fire in the vessel “Almudaina” at a shipyard In order to put in place a new and more effectiveframework to reduce accidents at the workplace, the Workplace Safety and Health Act was passed inParliament on 17 January 2006 and came into effecton 1 March 2006. This Act will form the legal framework for the new Occupational Safety Health regulatory system. It also contains a revised penalty framework to reflect the cost of poor safety management. While the maximum fine for the individuals remains at up to $200,000, the jail term has been increased from 12 months to 24 months whereas for corporations, they can be fined up to $500,000. This new regulation will require employers to conduct comprehensive risk assessment for all work processes, and provide detailed plans to eliminate or minimise risks. In view of this, the Ministry of Manpower shall work with the construction industries from the design stage to identify potential risks, rather than wait till the plans are submitted. In addition, the Ministry of Manpower officers will also have a new enforcement tool – the power to issue “Remedial Orders” whereby the officers will beempowered to compel worksites to remove a workplace risk regardless of whether there is an imminent danger. Any non-compliance can lead to stop-work order. A greater responsibility and accountability will also be assigned to everyone, from rank-and-file workers to managers and directors of companies, even though they may not be directly involved at the workplace or may not be able to physically police safety and health on the ground. The impact of these regulation changes especially with the stringent regulations and additional requirement on Health and Safety by the authorities has bearing on the overall construction costs, particularly on preliminaries and temporary works associated with construction. With effect from 1 September 2011, all workplaces will be covered under the WSHA. This latest extension bringson board more than 100,000 organizations with over1.6 million employees, or about half of the Singapore workforce. Companies and employees now covered under the Act will need to take reasonably practicable mea-
sures to ensure their workplaces are safe. This includes proper risk management or taking steps to identify and manage the existing risks in one’s workplace so as to prevent work incidents. Apart from the coverage extension of the WSHA, other key changes were also affected. These include: • Making the duties and obligations of the principals and the persons at work more defined • Enhancing the definition of Occupational Diseases to include any diseases that are attributable to chemical and biological agent exposure at work • The WSH (Noise) Regulations taking effect on 1 September 2011 and will include all workplaces to be covered under the regulation Workplace Safety and Health (WSH) (Construction) Regulations 2007 With effect from 1 January 2008, the WSH (Construction) Regulations 2007 replaces the Factories (BuildingOperations and Works of Engineering Construction) Regulations (BOWEC). The main changes of the Regulations are as follows: • Worksites with Contract Sum of less than $10 million are required to appoint a WSH Coordinator who shall assist the occupier to identify unsafe condition or unsafe work practice; recommend to the occupier such reasonably practicable measures; remedy the unsafe condition or unsafe work practice; and assist the occupier to implement such reasonable practicable measures • Inclusion of the recommendations of the MOM-MND Joint Review committee as follows: - Imposing statutory duties on Professional Engineers (PEs) undertaking design of temporary works - Requiring safety and health training for all supervisors - Instituting regular site coordination meetings - Implementing a permit-to-work system for selected hazardous work • Updating of the provisions to make it less prescriptive • Updating of all relevant terminologies • Clarifying the intended duty holder for the provision • Introducing offences and penalties provisions for the breach of the Regulations
CURRENT CONSTRUCTION REGULATIONS Code on Accessibility in the Built Environment 2007 The Code on Accessibility in the Built Environment 2007 implemented with effect from 1 April 2008 replacesthe previous Code on Barrier-Free Accessibility in Buildings 2002. The provisions of this Code will apply to new buildings and existing buildings undergoing majorretrofitting works, where the Building Plans are submitted for regulatory approval on or after 1 April 2008. The Code was first introduced in 1990 and aids tomake our buildings more user-friendly for the physically challenged. The Code was last reviewed and expanded in 2002 to include more mandatory barrier-free features in the common areas of new buildings. The current revised Code, which is in its 4th edition, contains additional requirements relating to theinterconnection between buildings and from buildingsto infrastructure and more mandatory requirementson elder-friendly features to prepare for an ageingpopulation. While the provisions in the Code are primarily meant to improve mobility for wheelchair users, they will also benefit others such as the elderly, parents with young children and people with different disabilities. Besides residential buildings, the revised Code has also expanded to incorporate accessibility enhancement to public parks, open spaces, vehicle parks, bus shelters and transport stations.
CURRENT CONSTRUCTION REGULATIONS Mandatory Water Efficiency Labelling Scheme (MWELS) With effect from 1 July 2009, the Public Utilities Board (PUB) implemented the Mandatory Water Efficiency Labelling Scheme (MWELS) to further promote water conservation, accelerate the adoption of water efficient fittings and products and encourage suppliers to bring in more water efficient models. The water fittings, appliances, apparatuses and products covered under MWELS include the following: a. Shower Taps and Mixers (except concealed shower taps and mixers and concealed bath/shower taps and mixers – which are not covered under MWELS for the time being) b. Basin Taps and Mixers c. Sink/Bib Taps and Mixers d. Dual Flush Low Capacity Flushing Cisterns (Dual Flush LCFCs) e. Urinal Flush Valves f. Waterless Urinals PUB will oversee the registration of water fittings,appliances, apparatuses and products under MWELSto which the labelling and standards provisions apply, and will monitor to enforce compliance with the scheme. All water fittings, appliances, apparatuses and products to be labelled under the mandatory and voluntary WELS shall comply with the standards and requirements stipulated by PUB. The Scheme requires the water fittings, appliances,apparatuses and products covered under MWELS to be labelled for the purpose of supply, sale or offer, display or advertisement for supply or sale or installation or use in Singapore. All water fittings, appliances, apparatuses and products that are required to be labelled under MWELS will be rated. “Zero Tick” label shall apply to water fittings, appliances, apparatuses and products that do not meet 1 or more ticks requirements or have not undergone test for water efficiency. In essence, the more number of ticks, the more water efficiency the product is. (See Figure 1 and Figure 2 below)
Figure 1 : Mandatory WELS Label
Figure 2 : Voluntary WELS Label
Source: Public Utilities Board (PUB) as at 1 July 2011
With effect from 1 October 2011, MWELS will be extended to clothes washing machines intended for household use and showerheads will be covered under voluntary WELS.
CURRENT CONSTRUCTION REGULATIONS Market Development Fund for the Usage of Clear and Renewable Energy in Singapore The Energy Market Authority (EMA) has set up the Market Development Fund (MDF) to encourage the installation of clean and renewable energy technologies/ systems in commercial or industrial building/facility (i.e. non-residential). To qualify for the funding support, the project must: • Demonstrate the use of clean and renewable energy technologies/systems for power generation • Participate in the wholesale electricity market • Utilize clean and renewable energy technologies/ systems that are supported by MDF, including: i. Solar (Photovoltaic (PV), Concentrated Solar PV and Concentrated Solar Power) ii. Wind turbines iii. Hydrogen production and fuel cells iv. Energy storage systems such as batteries v. Microturbines (biogas) vi. Integration of building or office energy management that will improve energy efficiency
systems
The MDF will co-fund 90% of the incurred market charges, subject to a cap of $50,000 per project. The funding support will last for two years but can be extended to a maximum of five years (subject to approval). The following market charges are applicable for reimbursement: a. b. c. d. e.
EMC Fees PSO Fees Reserve Regulation Charges (AFP) Spinning Reserves Charges (if applicable) Fixed Charges including: i. Billing and Collection Charge ii. Meter Reading and Data Management Fee iii. Telephone Subscription For Meter Reading iv. Wholesale Trading License
Note:EMC denotes Energy Market Company Pte Ltd. EMC operates Singapore’s wholesale electricity market. All of Singapore’s electricity is bought and sold through EMC. PSO denotes Power System Operator, a Division of the EMA and is responsible for the secure supply of electricity to consumers and operation of the transmission system. The Division operates from the Power System Control Centre (PSCC) which is the nerve centre of the electricity generation and transmission system in Singapore.
CURRENT CONSTRUCTION REGULATIONS Energy, Environment and Financial Impacts of Fuel Switch Solutions for Domestic Water Heating Systems in Singapore The National University of Singapore and ZEBTechnology Pte Ltd Singapore have carried out an independent study for City Gas Pte Ltd, Singapore to determine the financial and environmental impact of fuel switch solutions for domestic water heating systems in Singapore. The main objectives of the study are to compare the energy consumption and the carbon reduction between gas and electric type of domestic water heating systems in Singapore. The key findings of the study are summarized as follows: 1. At the individual user level, the annual energy cost saving (in %) may be as high as 91% for the conservative user, if one was to convert from electric storage heater to the gas continuous flow heater, and leaves the storage heater turn on for a period of approximately 52 minutes before use. On the other hand, if one was to switch from electric instantaneous heaters to gas continuous flow heaters, the savings could range between 14% and 44% of the total hot water energy use. 2. At a national level, the fuel switch from electric storage heater to gas continuous flow heater may reduce the carbon emission by up to 86%. This is equivalent to 0.5 million tons of carbon emission annually. There is a potential savings of up to 64% in energy use with respect to total energy use for hot water generation in Singapore when all households switch to using gas continuous flow heaters This translates to a saving of 700,000 MWh or S$149 million per year. This is equivalent to planting about 500,000 trees per annum to provide the carbon sink for the absorption of the same carbon; or equivalent to the removal of 72,780 cars from the road. 3. For new developments, the increase in installation cost for a gas continuous flow heater may be recovered from energy saving within 9 months for a small apartment to a maximum of 2.1 years for a large condominium. The payback period for a retrofit scenario from electric storage heater to gas continuous flow water heater ranges from 1.5 years to 3.2 years. 4. For Housing Development Board (HDB) developments, the estimated capital costs are in the range from S$750 to S$1,100 for 3-room to 5-room apartments respectively when residents opt for the gas continuous flow heaters. Generally, the payback period is in the range of 0.75 to about 2 years.
COST BREAKDOWN FOR DIFFERENT BUILDING TYPES BUILDING TYPES
STRUCTURAL
ARCHITECTURAL
M&E SERVICES
EXTERNAL WORKS
Bungalows
15%
47%
23%
15%
Condominiums
21%
50%
22%
7%
Offices
22%
44%
32%
2%
Hotels
19%
42%
35%
4%
Retails
23%
40%
32%
5%
Factories / Warehouses
30%
37%
28%
5%
Schools
25%
43%
22%
10%
Note: a) Structural includes Piling, Foundation and Structure. b) Architectural includes External walls, Internal Walls, Roof, Wall Finishes, Ceiling Finishes, Floor Finishes, Sanitary Fittings, Windows & Doors and Joinery Fittings. c) M&E includes Electrical Services, Fire Protection, Plumbing, Vertical Transport and ACMV
50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%
Bungalows
Condominiums
Structural
Offices
Architectural
Hotels
Retails
M&E
Factories/ Warehouses
External Works
Schools
CURRENT CONSTRUCTION REGULATIONS Sustainable Construction Capability Development Fund The $15 million Sustainable Construction Capability Development Fund (SC Fund) was established by the BCA to build up the capabilities of industry players in adopting Sustainable Construction (SC) practices,technologies and materials, and eventually steering the industry towards self-sustenance in the demand and supply of SC materials in Singapore. The SC Fund focuses on developing capabilities in recycling of waste materials arising from the demolition of buildings and using of recycled materials for construction. The incentive scheme operates on a co-funding basis (i.e. up to 50% of the total qualifying cost). The scheme came into effective on 15 April 2010 and will last for 5 years or till the $15 million is exhausted, whichever comes earlier. Firms that are registered and physically present inSingapore, will be able to apply for the SC Fundby submitting their detailed capability-developmentproposals to BCA, highlighting their capability-upgrading plans through manpower development, acquiring of equipment and engaging of external consultants, etc. The fund can be used for: • Enterprise-Level Projects – projects that improve capabilities
business’
• Industry-Level Projects – projects by a group of companies aimed at improving collective capabilities Appended below are the types of project / firm eligible for the SC Fund: • Demolition Contractors (Note: For projects involving demolition protocol, funding is capped at 2 projects of different building types per contractor and min. project size of GFA = 5,000m2) • Construction and Demolition (C&D) Industrial Waste Recyclers • Ready Mixed Concrete (RMC) Manufacturers • Pilot studies to gain technology know-how and confidence in adoption of new SC practices Note: Further information can be found in BCA’s website. (http://www.bca.gov.sg/Professionals/GovAsst/govasst.html)
CURRENT CONSTRUCTION REGULATIONS Construction Productivity and Capability Fund With the emphasis on the need to boost Singapore’s productivity level, the Government on 1 June 2010 launched a $250 million Construction Productivity and Capability Fund (CPCF). The objective is to steer the construction industry towards higher productivity and build capability. CPCF will also complement other regulatory changes such as the foreign workers’ levy framework, the gradual reduction of the Man-Year Entitlements (MYEs) quota and the enhancement of BCA’s buildability framework. The CPCF focuses on the following three broad aspects:
Source: Building and Construction Authority More information on the CPCF can be found in BCA’s website. (http://www.bca.gov.sg/CPCF/cpcf.html)
CURRENT CONSTRUCTION REGULATIONS Increase in Foreign Workers’ Levy As part of the Government’s strategy to achieve productivity-led growth, the Government announced on 8 March 2010 that the monthly levy for foreign workers would be raised in phases over 3 years starting from July 2010 to July 2012. The Government have made an announcement on 21 February 2011 that the foreign worker levy (FWL) rates will be further raised to enhance productivity and compe-tency of the construction workforce and reducing reliance on low-skilled foreign workers. The changes to the FWL rates and tiers will be phased-in from January 2012 to July 2013, at 6-monthly intervals. The salient changes are as follows: (a) Introduction of New Skills Framework in July 2011 • Unskilled Work Permit holders will be phased out • Introduce ‘Higher Skilled’ tier (R1) for Work Permit holders who possess the relevant certifications and experience • The criteria for R1 would include: - CoreTrade Registered; or - Have at least 4 years’ experience with additional/ specialised skills certifications • Re-classify existing Work Permit holders with only Skills Evaluation Certification (Knowledge) as ‘Basic Skilled’ (R2) • Retain MYE-waiver route but subject to higher levies (b) Monthly Levy Rates
•
•
•
•
With effect from 1 July 2011: - Higher Skilled Work Permit holders (R1)
=
$180
- Basic Skilled Work Permit holders (R2)
=
$230
- MYE Waiver *
=
$380
- Higher Skilled Work Permit holders (R1)
=
$200
- Basic Skilled Work Permit holders (R2)
=
$300
- MYE Waiver *
=
$450
- Higher Skilled Work Permit holders (R1)
=
$250
- Basic Skilled Work Permit holders (R2)
=
$350
- MYE Waiver *
=
$500
- Higher Skilled Work Permit holders (R1)
=
$280
- Basic Skilled Work Permit holders (R2)
=
$400
- MYE Waiver *
=
$550
With effect from 1 January 2012:
With effect from 1 July 2012:
With effect from 1 January 2013:
• With effect from 1 July 2013: - Higher Skilled Work Permit holders (R1)
=
$300
- Basic Skilled Work Permit holders (R2)
=
$450
- MYE Waiver *
=
$600
Note * The monthly levy rate applies to foreign workers from Non-Traditional Sources or People's Republic of China in the construction and process industries, who have been exempted from the requirement of Man-Year Entitlements (MYEs). To be exempted from MYE, the foreign worker must have at least two years' working experience in his respective industry and his employer has applied for a Work Permit without any Prior Approval support. Non-Traditional Sources - India, Sri Lanka,Thailand, Bangladesh, Myanmar, Philippines, Pakistan For more information, please refer to the Ministry of Manpower’s website.
(c) MYE Reduction - 1 July 2010 = 5% - 1 July 2011 = 10% - 1 July 2012 = 10% - 1 July 2013 = 15%
CURRENT CONSTRUCTION REGULATIONS New Measures to Reduce Noise The National Environment Agency (NEA) announced on 9 March 2010 that with effect from 1 September 2010, no construction activities would be allowed from 10pm on the night before a Sunday or a Public Holiday to 10am on the day itself. This new prohibition by the NEA will apply to construction sites located within 150 metres of residential areas and noise-sensitive developments. The new measures will be implemented in 2 phases. • Phase 1 will be implemented with effect from 1 September 2010 whereby all new projects will have to stop work from 10pm on Saturday to 10am on Sunday. This ban applies to any building project within 150m of a residential areas and noise-sensitive developments. It also applies to the eve of Public Holidays and Public Holidays. • Phase 2 will take effect from 1 September 2011 onwards, no construction activities would be allowed from 10pm on Saturday or eve of Public Holidays to 7am on the following Monday or day after the Public Holidays. This change in policy will inevitably create a need for construction companies to reschedule their construction work programme. As a result, it is anticipated that this could result in an increase in the contractor’s pricing of the preliminaries cost.
CURRENT CONSTRUCTION REGULATIONS Security of Water Storage Tanks With effect from 1 July 2011, all Town Councils (TCs), Management Corporation Strata Titles (MCSTs) and Building Owners are required to strengthen the security of water tanks on their premises. Accordingly, the following measures extracted from the Public Utilities (Water Supply) Regulations must be strictly complied with: a)Ensure that authorized persons are restricted to the TCs’/MCSTs’/Building Owners’ staff or the managing agent b) Ensure that personnel authorized to work at rooftops, pump/tank rooms & enclosures and tanks are properly attired (e.g. identification vests, badges, etc.) for easy identification as authorized personnel to work in these designated areas c)Conduct spot checks on works carried out at rooftops, pump/tank rooms & enclosures and tanks, and keep proper records of these checks d) Ensure that the room/enclosure housing the water tanks, access to high level tanks on the rooftop and the water tank inspection manhole covers are properly locked with the use of high quality padlocks or locksets (e.g. “Abloy”, “Kaba”, “Medeco”, “Mul-T”) to deny unauthorized access at all times. The hinges and latches should be of equally high quality and well secured e) Ensure that keys to the access doors and the water tank inspection covers are restricted to only the authorized persons f) Ensure that the keys to the locks to access doors and the tank inspection covers shall be of a type that cannot be duplicated. To provide separate keys for tank covers, pump room and roof access. One master key each for: • Access doors of not more than 100 blocks • Tanks of no more than 20 blocks • Corresponding locks shall be replaced if key is lost g)The keys for the locks for the tank inspection covers must be housed in a dedicated keypress separate from the other keys and access to these keypress must be strictly controlled by an authorized person h) Upon completion of work at the water storage tanks or at the end of the day, whichever is earlier, the authorized person must return the key to the office i) In the case of suspected water contamination, to immediately: • Notify PUB’s 24 hour call centre at 1800-284-6600 • Isolate the water supply and collect water samples • Notify verbally, followed by written notice, all the residents/occupants of the building not to consume or use the water due to possible water contamination
• Shut off the stopcock at the individual meter position of each unit in the building TCs/MCSTs/Building Owners are advised to segregate the water storage tank area from other activities and services. PUB will also work with the TCs/MCSTs/ Building Owners on further technological solutions such as the use of alarm system and remote monitoring, etc. Members of the public are encouraged to report any suspected unauthorized access to the premises where water tanks are located to the respective TCs/MCSTs/ Building Owners immediately. Note: On 30 June 2011, PUB announced the extension of the implementation date for the bolting of water tank covers and the replacement of locksets to 31 December 2011. Most of the operational measures to tighten water security, however, have/are being implemented.Source: Public Utilities Board (PUB)
CURRENT CONSTRUCTION REGULATIONS Implementation of Eurocodes in Singapore The Building and Construction Authority (BCA) announced to the construction industry in October 2006 their decision to align with the practice in United Kingdom (UK) in adopting Eurocodes as the structural design standards and together with SPRING formed various technical committees to review the corresponding UK National Annexes of the Eurocodes for adoption as our local standards. In a recent BCA’s circular (dated 26 September 2011), it has been informed that almost all of these documents for the design of concrete and steel structures have been published as Singapore Standards (SS ENs). With effect from 1 April 2012, BCA plans to accept the Singapore version of the Eurocodes (i.e. SS ENs and the Singapore National Annexes). The date of implementa-tion will be informed once Approved Documents is amended to include the SS ENs as the acceptable standards for the structural design. To facilitate the transition to the new SS ENs, there will be a co-existence period of 2 years from the commencement date of adoption of SS ENs, during which either the BS or Eurocode design standard will be acceptable. To familiarise the industry with the new SS Eurocode standards, the BCA Academy, SPRING, participating professional associations and our local universities have been organising training courses and seminars since 2006. Details of the various courses and workshops organised by BCA Academy can be obtained at the following websites: • www.bcaa.edu.sg (and doing a search under “Eurocodes”) •http://www.bca.gov.sg/academy/courses_tests. aspx?txtCourseTestCode=eurocode Source: Building and Construction Authority
M&E COSTS FOR SINGAPORE TYPES
ACMV
ELECTRICAL HYDRAULIC
FIRE
LIFTS
BAS
S$/m2
S$/m2
S$/m2
S$/m2
S$/m2
S$/m2
Detached Houses
89 - 104
87 - 115
64 - 89
0- 4
-
-
Average Standard Condominium
95 - 124
109 - 155
75 - 114
19 - 37
27 - 54
-
115 - 192
154 - 252
92 - 159
19 - 53
36 - 123
-
Average Standard Offices
153 - 194
203 - 259
31 - 49
32 - 53
62 - 115
7 - 21
Prestige Offices
169 - 228
227 - 306
39 - 71
44 - 64
90 - 177
15 - 30
Flatted Factories
69 - 136
76 - 148
20 - 39
39 - 54
46 - 96
4 - 16
Warehouses
29 - 77
58 - 97
19 - 29
24 - 54
46 - 114
4 - 11
Resort Hotels
150 - 209
202 - 274
97 - 124
49 - 59
76 - 119
5 - 26
3-Star Hotels
164 - 216
218 - 293
97 - 123
49 - 68
76 - 120
5 - 26
5-Star Hotels
200 - 289
279 - 340
118 - 136
53 - 78
100 - 138
30 - 47
Multi-Storey Car Parks
18 - 36
15 - 39
4 - 13
17 - 37
0 - 23
-
Basement Car Parks
28 - 50
23 - 42
8 - 19
26 - 42
0 - 23
-
158 - 214
170 - 275
49 - 75
38 - 63
83 - 200
4 - 37
RESIDENTIAL
Luxury Condominium OFFICE
INDUSTRIAL
HOTELS
OTHERS
Shopping Centres
The above costs are at 4th Quarter 2011 levels.
OFFICE M&E COST COMPONENTS ACMV 9%
18%
Plumbing and Sanitary 3% 3%
11%
7% 9%
19%
2%
1%
12%
3% 5%
8%
9%
20%
27%
28%
Chillers plant Cooling towers Chilled water pumps Chilled water pipeworks Condenser water pumps and pipeworks Condenser water pipeworks
6% Water tank Water pumps Cold water distribution piping Installation and connection of water piping to sanitary wares Aboveground drainage piping system Underground drainage piping system Installation and connection of waste piping to sanitary wares
Chilled water AHU/FCU system AC ductworks, diffusers and accessories Split type air-conditioning units and ductworks Mechanical ventilation fan system MV ductworks, diffusers and accessories Electrical and automatic control works
Electrical
2% 2% 2%
8%
2%
4%
Fire Protection
45%
2%
10% 5%
5%
20%
10%
3%
4%
23%
3%
1% 23%
LV mains & sub-mains distribution system Lightning protection system Luminaries Earthing system Final sub-circuit for lighting & power points External lighting Standby generator Telephone distribution system Sub-station, HV & LV switchgear MATV/SCV system Underfloor trunking system CCTV/Guard patrol system Power transformer Public address system Intercom/Card access system
4% 12%
10% Sprinkler Hose reel Wet riser Dry riser Automatic fire alarm Fire extinguisher External fire hydrant
M&E COST CHARTS Single Core PVC Cables
Pipework
175
300
150
250 200
100
$/m
$/m
125
75
150 100
50
50
25
0
0 1
2.5
6
16
35
70
120 185
300
500
15
800
20
25
32
40
mm2 1 x 1 Core
1 x 3 Core
1 x 4 Core
Galvanised Steel
4,000
400
3,000
300
$/m2
$/no
500
2,000
200
1,000
100
50
80
125 200 300 400 600 800 1,250
26
24
Four Pole
Galvanised Steel
200
UPVC
20
18
16
Stainless Steel
2 hr Fire Rated
Valve
4,000
4,000
3,000
3,000
$/no
$/no
150
Gauge (SWG)
Wall Mounted Direct Expansion Fan Coil Unit
2,000
2,000 1,000
1,000
0
0 2.6
3.5
4.4
5.3
15
6.4
25
40
Single Split Unit
65
100
200
300
Diameter (mm)
Cooling Capacity (kW) Gate Valve
VRV
Check Valve
Globe Valve
Motor and Starter
Condensing Unit 8,000
8,000
6,000
6,000
$/no
$/no
Black Steel
22
Amp Triple Pole
100
0
0 32
80
Ductwork
5,000
16
65
Diameter (mm)
22kA MCCB
6
50
4,000 2,000
4,000 2,000
0
0 17.1
23.5
28.2
Cooling Capacity (kW) Single Split Unit
VRV
0.38
0.75
2.25
3.75
7.5
15
22.5
Capacity (kW) Motor
Starter
37.5
75
COMMON STANDARD FORMS OF CONTRACT IN SINGAPORE - CURRENT AS OF 2012 • Articles and Conditions of Building Contract published by the Singapore Institute of Architects, 9th Edition, Reprint August 2011 [Measurement Contract] • Articles and Conditions of Building Contract published by the Singapore Institute of Architects, 9th Edition, Reprint August 2011 [Lump Sum Contract] • Articles and Conditions of Building Contract for Minor Works published by the Singapore Institute of Architects, 1st Edition 1987 • Conditions of Sub-Contract for use in conjunction with the Singapore Institute of Architects Main Building Contract, 4th Edition, Reprint August 2011 • REDAS Design and Build Conditions of Contract published by the Real Estate Developers' Association of Singapore, 3rd Edition October 2010 • FIDIC Forms of Conditions of Contract published by the Federation Internationale des Ingenieurs-Conseils, 1st Edition 1999 - Conditions of Contract for Construction for Building and Engineering Works designed by the Employer - Conditions of Contract for Plant and Design-Build for Electrical and Mechanical Plant and for Building and Engineering Works designed by the Contractor - Conditions of Contract for EPC/Turnkey Projects - Short Form of Contract • Public Sector Standard Conditions of Contract for Construction Works published by the Building and Construction Authority, 6th Edition December 2008 • Public Sector Standard Conditions of Contract for Design and Build published by the Building and Construction Authority, 5th Edition December 2008 • Standard Conditions of Nominated Sub-Contract for use in conjunction with the Public Sector Standard Conditions of Contract for Construction Works published by the Building and Construction Authority, 5th Edition December 2008
EXCHANGE RATES Approximate current rates at 28 September 2011 COUNTRY Australia
PER UNIT dollar
S$ 1.271
China
rmb
0.2002
Euro
eur
1.7488
100 HKd
0.1655
Hong Kong India
100 rupees
2.63
Indonesia
100 Rp
0.0146
Japan
100 yen
1.688
Korea
won
0.0011
ringgit
0.4075
Malaysia Philippines
100 peso
2.98
Taiwan
NT dollar
0.0424
Thailand
100 baht
4.18
United Kingdom
pound
2.015
USA
dollar
1.29
Vietnam
dong
0.000062
Source: The Hongkong and Shanghai Banking Corporation Limited
CURRENCY FLUCTUATIONS Sterling Pound
US Dollar
S$ per 1 STGP
S$ per 1 US$
3.4
1.9
3.2
1.8
3.0
1.7
2.8
1.6
2.6
1.5
2.4
1.4
2.2
1.3
2.0 1.8
02
03
04
05
06
07
08
09
10
11*
12
1.2
02
03
04
05
06
07
08
Ringgit Malaysia
Japanese Yen
S$ per 1 RM
S$ per 100 Yen
09
10
11*
12
09
10
11*
12
1.7
0.50
1.6
0.48
1.5 0.45 1.4 0.43
0.40
1.3
02
03
04
05
06
07
08
09
10
11*
12
Note: *Currency fluctuation for 2011 is based on January 2011 to November 2011
1.2
02
03
04
05
06
07
08
Note: *Currency fluctuation for 2011 is based on January 2011 to November 2011
RELEVANT WEBSITES Singapore Government Accounting and Corporate Regulatory Authority Board of Architects Singapore Building and Construction Authority Central Provident Fund Board Housing & Development Board Inland Revenue Authority of Singapore Integrated Land Information Service Intellectual Property Office of Singapore International Enterprise Singapore Land Surveyors Board Singapore Land Transport Authority Ministry of Community Development, Youth and Sports Ministry of Defence Ministry of Education Ministry of Finance Ministry of Foreign Affairs Ministry of Health Ministry of Home Affairs Ministry of Information, Communications and The Arts Ministry of Law Ministry of Manpower Ministry of National Development Ministry of the Environment and Water Resources Ministry of Trade and Industry Ministry of Transport Monetary Authority of Singapore National Parks Board Professional Engineers Board Singapore Public Utilities Board Singapore Civil Defence Force Singapore Department of Statistics Singapore Economic Development Board Singapore Government Website Singapore Land Authority Singapore Power Ltd Group Strata Titles Boards Urban Redevelopment Authority
www.acra.gov.sg www.boa.gov.sg www.bca.gov.sg www.cpf.gov.sg www.hdb.gov.sg www.iras.gov.sg www.inlis.gov.sg www.ipos.gov.sg www.iesingapore.gov.sg www.minlaw.gov.sg/lsb www.lta.gov.sg www.mcys.gov.sg www.mindef.gov.sg www.moe.gov.sg www.mof.gov.sg www.mfa.gov.sg www.moh.gov.sg www.mha.gov.sg www.mica.gov.sg www.minlaw.gov.sg www.mom.gov.sg www.mnd.gov.sg www.mewr.gov.sg www.mti.gov.sg www.mot.gov.sg www.mas.gov.sg www.nparks.gov.sg www.peb.gov.sg www.pub.gov.sg www.scdf.gov.sg www.singstat.gov.sg www.edb.gov.sg www.gov.sg www.sla.gov.sg www.singaporepower.com.sg www.mnd.gov.sg/stb/ www.ura.gov.sg
Construction-Related Associations in Singapore Real Estate Developers’ Association of Singapore Singapore Green Building Council Singapore Institute of Planners Singapore Institute of Architects Association of Consulting Engineers Singapore The Institution of Engineers Singapore Society of Project Managers Singapore Institute of Surveyors and Valuers Association of Property and Facility Managers Singapore Institute of Building Limited The Law Society of Singapore
www.redas.com www.sgbc.sg www.sip.org.sg www.sia.org.sg www.aces.org.sg www.ies.org.sg www.sprojm.org.sg www.sisv.org.sg www.apfm.org.sg www.sib.com.sg www.lawsociety.org.sg
Others Davis Langdon & Seah Asia
www.dlsqs.com
About Us Davis Langdon & Seah (Thailand) Ltd. was established in 1990 to operate in conjunction with our sister company LECE (Thailand) Co.,Ltd. (Langdon Every Cost Engineering) which was first established in 1984 to provide cost engineer-ing and project management support services to the Oil Industry in Thailand. In 1987, responding to popular demand, the activities were extended to cover the whole range of quantity surveying / cost management services for the Building and Construction Industry in general.
Davis Langdon & Seah (Thailand) Ltd. LECE (Thailand) Co., Ltd. Quantity Surveyors & Construction Cost Consultants
Construction Costs for Thailand DOMESTIC
Terraced houses Average standard apartments, high rise Luxury apartments, high rise Luxury Villa OFFICE / COMMERCIAL
Average standard offices, high rise Prestige offices, high rise Shopping centres
HOTELS
Resort hotels 3-star budget hotels, inclusive of F.F.&E. 5-star luxury hotels, ditto
INDUSTRIAL
Light duty flatted factories Heavy duty flatted factories and warehouses Single storey conventional factory of structural steelwork Owner operated factories, low rise OTHERS
Basement car park (< 3 levels) Elevated car parks (< 4 levels) Primary and Secondary Schools Student hostels Sports clubs including F.F.& E.
BANGKOK
PATTAYA
17,500 24,850 34,850 29,000
17,500 24,500 34,850 N/A
22,500 30,000 28,000 68,000 41,000 58,000
Baht/m2 CHIANGMAI
KOH SAMUI
PHUKET
N/A 26,500 34,850 N/A
N/A N/A N/A 74,000
N/A N/A N/A 64,000
22,250 29,500 28,000
21,500 N/A 24,500
N/A N/A N/A
N/A N/A 26,500
68,000 41,000 58,000
68,000 41,000 58,000
83,000 N/A 83,500
74,000 N/A 68,000
18,000 N/A 18,000
18,000 N/A 18,000
N/A N/A N/A
N/A N/A N/A
N/A N/A N/A
N/A
N/A
N/A
N/A
N/A
20,500 10,500 N/A N/A N/A
20,000 10,000 N/A N/A N/A
N/A 10,000 N/A N/A N/A
N/A N/A N/A N/A N/A
N/A 12,000 N/A N/A N/A
Major Rates for Thailand DESCRIPTION
BANGKOK
Baht CHIANGMAI KOH SAMUI
PHUKET
1. Excavating basement ≤ 2m deep 2. Excavating for footings ≤ 1.5m deep 3. Remove excavated materials off site 4. Hardcore bed blinded with fine materials 5. Mass concrete grade 15 6. Reinforced concrete grade 30 7. Mild steel rod reinforcement 8. High tensile rod reinforcement 9. Sawn formwork to soffits of suspended slabs 10. Sawn formwork to columns and walls 11. 112.5mm thick brick walls 12. “Kliplok Colorbond” 0.64mm profiled steel sheeting 13. Aluminium casement windows, single glazed
m3 m3 m3 m3 m3 m3 kg kg m2 m2 m2
100.00 100.00 100.00 600.00 2,000.00 2,400.00 31.00 30.00 350.00 350.00 700.00
250.00 250.00 150.00 700.00 2,400.00 3,000.00 35.00 34.00 450.00 450.00 800.00
200.00 200.00 150.00 800.00 3,200.00 3,400.00 38.00 37.00 480.00 480.00 800.00
250.00 250.00 150.00 800.00 2,400.00 3,000.00 35.00 34.00 420.00 420.00 800.00
m2 m2
1,200.00 6,000.00
1,200.00 6,500.00
1,200.00 7,500.00
1,200.00 6,500.00
14. Structural steelwork - beams, stanchions and the like 15. Steelwork - angles, channels, flats and the like 16. 25mm cement and sand (1:3) paving 17. 20mm cement and sand (1:4) plaster to walls 18. Ceramic tiles bedded to floor screed (m/s) 19. 12mm fibrous plasterboard ceiling lining 20. Two coats of emulsion paint to plastered surfaces Average expected preliminaries
kg
55.00
60.00
60.00
55.00
kg m2 m2 m2 m2
55.00 200.00 200.00 1,200.00 800.00
60.00 250.00 250.00 1,200.00 800.00
60.00 250.00 250.00 1,200.00 900.00
55.00 250.00 250.00 1,200.00 800.00
m2 %
100.00 10 - 15
120.00 12 - 20
150.00 15 - 25
100.00 15 - 17
The above costs are at 4th Quarter 2011 levels, exclusive of contingencies and preliminaries.
Fit-Out Costs for Bangkok DESCRIPTION HOTELS
Public Area (Front of House) 3-star Hotel 4-star Hotel 5-star Hotel
Bt/m
2
20,000 30,000 45,000 -
30,000 45,000 above
Bt/Room Guest Rooms : 3-star Hotel 400,000 - 800,000 800,000 - 1,400,000 4-star Hotel 5-star Hotel 1,400,000 - above Notes: 1. Includes furniture, floor, wall and ceiling finishes, drapery, sanitary fittings and light fittings. 2. Excludes partitioning, M&E works, building shell, chandelier, operational items and equipment (e.g. bed, cutlery, crockery, linen, television, refrigerator etc.), opening expenses, stage equipment and computer systems. OFFICES
Bt/m
2
General office 15,000 - 20,000 Executive office 20,000 - 25,000 25,000 - above Prestige office Notes : 1. Local furniture allowed for general offices 2.Includes furniture, partitioning, minor alteration to airconditioning, fire services and suspended ceiling to suit layout. 3. Excludes telephones, Local Area Network, office equipment (e.g. computers, photocopies, fax machines, UPS, etc).
RESTAURANTS
General dining restaurant
Bt/m
20,000 45,000 -
2
45,000 above
Fine dining restaurant Notes : 1. Includes furniture, floor, wall and ceiling finishes, minor alteration to air-conditioning and fire services installation to suit layout, exhaust for kitchen but excludes exhaust flue, operational items (e.g. cutlery, crockery, linen, utensils, etc).
Construction Material Price Index (Year 2005 = 100) 2005
Timber Products Cement Concrete Ingredient Iron products Tiles Paint Sanitary Ware Electrical & Plumbing Others All Commodities
100.0 100.0 100.0 100.0 100.0 100.0 100.1 100.0 100.0 100.0
2006
2007
105.4 104.6 103.8 98.6 103.0 103.0 112.6 109.8 108.8 103.7
109.8 106.7 105.1 108.8 106.6 102.2 123.5 113.9 110.2 108.8
2008
2009
133.4 112.8 103.8 103.6 110.7 113.2 148.9 108.2 119.2 110.8
118.8 114.2 109.8 150.5 109.1 105.8 131.8 114.7 118.3 127.4
2010
135.8 104.2 102.5 110.9 110.6 113.8 144.5 110.4 122.8 113.3
2011
139.8 115.1 106.2 123.6 109.3 116.5 150.0 113.6 129.2 120.2
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
Construction Material Price Index (Year 2005 = 100) 170.0 150.0 130.0 110.0 90.0 70.0 50.0 2000
2001
2002
2003
2004
2005
2006
2007
2008
Timber Product
Cement
Concrete Ingredient
Iron Products
Tiles
Sanitary ware
Electrical & Plumbing
Others
All Commodities
Paint
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
2009
2010
2011
Percentage Change of Construction Material Price Index
Timber Products Cement Concrete Ingredient Iron products Tiles Paint Sanitary Ware Electrical & Plumbing Others All Commodities
Source : Bureau of Trade and Economic Indices Ministry of Commerce Thailand
2005
2006
2007
2008
2009
2010
2011
3.14% -6.45% 2.35% -3.01% 2.15% 3.09% 4.93% 2.46% 5.82% 0.00%
5.40% 4.60% 3.80% -1.40% 3.00% 2.90% 12.60% 9.80% 8.80% 3.70%
4.17% 2.01% 1.25% 10.34% 3.50% -0.78% 9.68% 3.73% 1.29% 4.92%
8.20% 7.03% 4.47% 38.33% 2.35% 3.52% 6.72% 0.70% 7.35% 17.10%
12.29% -1.23% -5.46% -31.16% 1.47% 6.99% 12.97% -5.67% 0.76% -13.03%
1.80% -7.62% -1.25% 7.05% -0.09% 0.53% -2.96% 2.03% 3.02% 2.26%
2.95% 10.46% 3.61% 11.45% -1.18% 2.37% 3.18% 2.90% 5.21% 6.09%
LAND AND BUILDING TRANSACTION NATIONWIDE Land and Building Transaction Nationwide 900,000 800,000
(Million Bath)
700,000 600,000 500,000 400,000 300,000 200,000 100,000 -
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Millions (Baht) 164,8 238,2 367,0 270,1 279,0 344,7 404,7 396,1 441,2 338,9 209,1 186,2 193,7 208,9 364,0 762,5 694,3 621,9 617,9 593,5 709,1 661,1 808,9
Source : Bank of Thailand
CONSTRUCTION AREAS PREMITTED IN MUNICIPAL ZONE Construction Areas Permitted in Municipal Zone 40,000 35,000 30,000
m2 ('000)
25,000 20,000 15,000 10,000 5,000 -
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Residen al
23,102
16,593
11,546
4,569
3,806
4,886
6,393
10,215
13,206
16,111
14,448
13,695
12,917
12,494
10,974
12,471
Commercial
10,721
8,136
8,485
1,902
2,058
1,883
1,702
2,255
3,364
3,641
2,973
3,483
2,444
2,909
3,755
2,878
Industrial & others
2,963
2,020
1,715
971
769
835
864
1,421
2,002
2,947
2,213
2,394
2,002
2,088
2,258
2,610
Source : Bank of Thailand
LAND TITLES AND MEASUREMENT Land Titles Chanote – Chanote is the only true title deed. The person’s name shown on the deed has the legal ownership to the land. The land is accurately survey and plotted with unique numbered marker posts set in the ground. Nor Sor Sam Gor – Nor Sor Sam Gor certifies the person named on the certificate has the right to possess the land and use the benefit of the land as an owner. The land is accurately survey and the issuance of the title deed is pending. Nor Sor Sam – Similar to Nor Sor Sam Gor but not all of the formalities to certify the right to use have been performed. The land is not accurately survey and may subject to boundary dispute. Other forms of land title or rights are Sor Kor Nung, Por Bor Tor 6 and Sor Por Kor 4-01. Land with these type of titles or certificates can neither be transferred nor obtained approval to build on. Land Measurement : 1 Hectare is approximately 6.25 Rai 1 Rai
= 1,600m2 = 4 Ngan
1 Ngan = 400m2 1 Wah = 4 m2
= 100 Wah
Exchange Rates as at 20 December 2011
Country
Currency
THB 1
US $1
Australia
dollar
0.03206
1.0061
Bahrain
dinar
0.01196
0.3753
Brunei
dollar
0.04092
1.2841
China
rmb
0.20284
6.3657
Egypt
pound
0.19138
6.0063
ecu
0.02447
0.7680
dollar
0.24803
7.7842
India
rupees
1.71817
53.922
Indonesia
rupiah
287.576
9025.2
Japan
yen
2.48000
77.90
Kenya
shillings
2.62224
82.296
Lebanon
pound
47.2000
1,482.22
Malaysia
ringgit
1.10129
3.1789
New Zealand
dollar
0.04192
1.3156
Pakistan
rupee
2.82474
88.651
Philippines
peso
1.39572
43.803
Qatar
riyal
0.11586
3.6361
Russia
rubles
1.01977
32.004
Singapore
dollar
0.04159
1.3054
South Africa
rand
0.26681
8.3734
South Korea
won
37.2194
1,168.0
Thailand
baht
1.00000
31.2089
United Arab Emirates
dirham
0.11701
3.6722
United Kingdom
pound
0.02054
0.6477
United States of America
dollar
0.03186
1.0000
European Currency Unit Hong Kong
Source: www.oanda.com/convert/classic
INTRODUCTION Davis Langdon & Seah International has been involved in the publication of construction costs handbooks for countries such as Hong Kong, India, Malaysia, Philippines and Singapore and is also the editor of the Spon’s Price Book Series which comprise: • Spon’s Asia Pacific Construction Costs Handbook • Spon’s European Construction Costs Handbook • Spon’s Architects' and Builders’ Price Book • Spon’s Civil Engineering and Highway Works Price Book • Spon’s Mechanical and Electrical Services Price Book • Spon’s Landscape and External Works Price Book (co-edited by Derek Lovejoy Partnership) This version of DLS Handbook - Vietnam 2012, as other future annually published handbooks, focuses on the construction cost profile of Vietnam and those of the major cities in Asia. The handbook is structured to serve as a general reference guide on construction cost indicators in Asia. The information contained in this handbook has been compiled by Davis Langdon & Seah Vietnam Co Ltd. Any further information and/or if advice relating to particular projects in specific region is required, please contact any of the regional offices listed under the Directory of Davis Langdon & Seah International Offices at the end of this handbook. Davis Langdon & Seah Vietnam Co Ltd
CONSTRUCTION MARKET 2012 OUTLOOK 2011 has been a year of economic cooling down and this is reflected in the fact that GDP growth in 2011 was circa 6.3% compared with 6.8% in 2010. It is most likely that construction output will grow at a slower rate in 2011 than in 2010. Over the past 12 months there have been a range of fiscal constraints imposed upon the Vietnam Economy in order to reduce economic overheating. The resultant effects of such overheating over the past couple of years have been significant balance of payment deficits and very high inflation. In order to cool down the economy the central banks have been raising interest rates and reduced funding into the property market. Such actions have reduced money in the property market and hence reduced demand and we observe that these measure do seem to be having a positive effect on the overall Vietnam balance sheet, past monthly trade deficits are now becoming trade surpluses and inflation is starting to drop. We suspect the current fiscal measure of high interest rates and reduced funding into the construction / property sectors will continue until mid 2012. Foreign Direct Investment commitments remains lower than in
2008 / 9 and furthermore the level FDI disbursement from previously committed projects has now reduced. We further suspect Overseas Development Aid disbursement and Public Sector investment to remain consistent with 2010 levels. Owing to the above factors we suspect that 2012 construction output growth will be similar or slightly lower than 2011. Notwithstanding the current economic climate there is still growth (albeit slower growth) in the construction sector and there are some very notable projects commencing construction including: • Saigon Center Phase 2 & 3 in district 1 Ho Chi Minh City. • Vietsin Commercial Development in district 1 Ho Chi Minh City. • Ben Thanh Towers in district 1 Ho Chi Minh City. • VietinBank HQ in Hanoi • UNDP HQ in Hanoi.
The industrial construction sector is also growing significantly and as is supported by focused lending in order to reduce Vietnam trade deficits. The industrial sector seems to be attracting FDI and there are a number industrial companies looking to establish operations in Vietnam. Although construction growth in 2011 have been at a slower rate than previous years we note that construction prices have generally risen in 2011 and this is largely due to price rises in local materials namely; steel, cement and aggregates.
80.00
1800
70.00
1600 1400
60.00
1200
50.00
Nos. of projects
Billions US$
Annual Foreign Investment (1998-2011)
1000
40.00
800
30.00
600
20.00
400
10.00
200
0.00
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011*
Registered Capital (bn US$)
5.10
2.57
2.84
3.14
3.00
3.19
4.55
6.84
12.00
21.30
71.73
22.63
18.60
12.70
Legal Capital (bn US$)
2.47
0.98
1.31
1.71
1.27
1.14
1.22
1.97
4.67
6.04
11.50
10.00
11.00
10.05
No. of Projects
285
327
391
555
808
791
811
970
987
1544
1557
1155
969
919
0
Note: 2011 from Jan to Nov (Source: Vietnam Investment Review)
FDI by countries as of Nov 2011
3500 3000
20.00 2500 15.00
2000 1500
10.00
1000 5.00 500 0.00 Registered Capital
Taiwan
Malaysia
Japan
S. Korea
Singapore
B.V.Islands
Hong Kong
Thailand
Canada
Brunei
23.43
9.36
23.28
23.65
23.38
14.94
10.97
5.75
4.66
4.80
Legal Capital
9.97
3.77
6.63
8.13
9.71
4.75
3.61
2.58
1.00
0.99
No. of Projects
2,203.00
393.00
1,636.00
3,072.00
973.00
497.00
654.00
266.00
114.00
122.00
(Source: Vietnam Investment Review)
Vietnam Annual ODA
billion US$ 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00
1998 2.20
1999 2.21
2000 2.40
2001 2.06
2002 2.10
2003 2.48
2004 2.27
2005 3.48
2006 3.10
2007 2.17
2008 5.43
2009 8.06
2010 7.90
2011 7.40
ODA Disbursement 1.24
1.35
1.65
1.28
1.33
1.87
1.83
1.94
1.89
1.75
2.20
4.10
3.51
3.65
ODA Commitment
Note: 2011 from Jan to Nov
(Source: Ministry of Planning and Investment)
0
Nos. of Projects
Billion US$
25.00
FDI by Sectors November 2011 23% 73% 4%
Agriculture & Forestry & Aquaculture
No. of projects
Registered Capital (mn US$)
Industry and construction
9,932
164,219.72
55,174.15
Manufacturing
7,938
92,081.11
34,223.59
Property
370
46,620.61
11,396.71
Cconstruction
815
12,438.91
3,929.68
Mining
69
2,974.77
2,370.11
68
7,396.15
1,660.97
Wholesale & Retail
646
1,998.79
1,033.00
Water supply & Waste treatment
26
709.38
560.09
492
3,185.07
1,538.66
2.3%
28,499.06 10,697.28
15.9%
Sector 1
Electricity, gas and water production and distribution
2 3
Service
Agriculture & Forestry & Aquaculture Service
3,072
Legal Capital (bn US$)
Hotel & Restaurant
313
11,808.80
IT
698
5,242.89
3,109.61
Art & Entertainment
128
3,635.91
1,102.25
Logistics
314
3,249.77
1,009.12
75
1,321.55
1,171.79
Health care
73
1,015.50
220.85
Science & Technology
1,104
969.16
496.65
Education and Training
150
354.56
123.53
Supporting services
104
187.69
96.30
113
Total
13,496
713.23 195,903.85
81.8%
3,214.28
Finance, Banking & Insurance
Others
Registered Capital (%)
152.90 67,410.09
100%
(Source: Vietnam Investment Review)
Vietnam Construction Output Table
Year
Construction Output (US$ billion)
Proportion of GDP (%)
Real Construction Output Growth (%)
2000
1.63
5.35
7.51
2001
1.94
5.8
12.78
2002
2.07
5.89
10.57
2003
2.39
6.05
10.59
2004
2.82
6.23
9.03
2005
3.35
6.35
10.87
2006
4.09
6.62
11.05
2007
4.94
6.96
12.01
2008
6.23
6.61
0.02
2009
6.19
6.65
11.36
2010
7.13
7.03
11.06
2011 - 9mths
4.84
5.94
4.91
(Collective data from General Statistics Office)
MATERIAL PRICE INDICES Steelbar (D12-D25) Year
Quarter
I II III IV I II III IV I II III IV I II III IV
2008
2009
2010
2011
Index (Base QI/2008)
VND/T 11,200,000 14,518,000 17,305,000 12,000,000 10,940,000 10,990,000 11,820,000 12,220,000 12,452,500 11,590,000 12,830,000 13,440,000 15,030,000 14,730,000 15,925,000 15,925,000
Concrete (Grade 250)
Index Inflation $VND/m 3 (Base QI/2008)
100.00 129.63 154.51 107.14 97.68 98.13 105.54 109.11 111.18 103.48 114.55 120.00 134.20 131.52 142.19 142.19
0.00% 29.63% 19.20% -30.66% -8.83% 0.46% 7.55% 3.38% 1.90% -6.93% 10.70% 4.75% 11.83% -2.00% 8.11% 0.00%
676,804 790,476 904,000 850,000 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 879,819 970,000 970,000
100.00 116.80 133.57 125.59 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 130.00 143.32 143.32
Cem ent (PCB40)
Inflation
VND/kg
0.00% 16.80% 14.36% -5.97% 3.51% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 10.25% 0.00%
976 973 1,275 1,273 1,255 1,255 1,255 1,255 1,255 1,218 1,209 1,209 1,241 1,263 1,459 1,459
Index (Base QI/2008)
Inflation
100.00 99.69 130.64 130.43 128.59 128.59 128.59 128.59 128.59 124.80 123.87 123.87 127.15 129.41 149.49 149.49
0.00% -0.31% 31.04% -0.16% -1.41% 0.00% 0.00% 0.00% 0.00% -2.95% -0.74% 0.00% 2.65% 1.77% 15.52% 0.00%
(Source: Ho Chi Minh City Departments of Construction and Departments of Finance Year 2008-2011)
160.00 150.00 140.00 130.00 120.00 110.00 100.00 90.00 80.00
I
II
III
IV
I
II
III
IV
I
II
2009
2008 Steelbar (D12-D25)
III 2010
Concrete (Grade 250)
IV
I
II
III 2011
Cement (PCB40)
IV
IMPORT DUTIES Unit
MFN / WTO
CEPT
ACFTA
Non-ACFTA
AKFTA
Non-AKFTA
AJCEP 3
VJEPA 2
AANZFTA
AIFTA
VAT Tariff
Special Tariff
Marble
kg
10
0
10
(1)
15
(2)
20
22
25
20
10
Granite
kg
10
0
10
(1)
15
(2)
20
22
25
20
10
Carpentry of Wood
kg
3
0
5
-
5
-
5
4
5
4.5
10
Porland cement
kg
34
5
-
-
-
-
-
-
30
-
10
Ceramic building bricks, flooring blocks
35
5
-
-
20
-
33
35
30
35
10
Ceramic roofing tiles
45
5
-
-
20
-
41
44
30
48
10
m2
45
5
-
-
20
-
41
44
30
48
10
Ceramic sanitary fixtures of unit porcelain
38
5
20
(3)
20
-
41
44
30
48
10
Multiple-walled insulatin units of glass
m2
25
5
10
-
-
-
30
30
25
-
10
Glass mirror (unframed)
kg
25
5
-
-
-
-
30
30
25
-
10
10
0
7
7
10
-
10
DESCRIPTION (all figures)
Ceramic floor, hearth, wall tiles
Concrete steel
kg
15
5
12.5
(4)
U,I or H section of steel (height under 80mm)
kg
10
5
18
-
-
-
29
30
-
-
10
Alluminium doors, windows, m2 frames and thresholds
15
5
10
-
10
-
13
15
15
14
10
Air conditioner (window or wall mounted) not exceeding 26,38kW
unit
32
5
20
(5)
-
-
33
35
30
29
10
Passenger lifts
unit
10
5
5
(6)
5
(6)
7
8
10
8
10
Water pump
unit
22
5
10
-
-
-
24
26
25
29
10
Electric genset not exceeding 75KVA
unit
10
0
5
(1)
5
-
7
7.5
10
8
10
MFN/WTO CEPT/AFTA ACFTA AKFTA AJCEP 3 VJEPA 2 AANZFTA AIFTA (1)
: : (3) : (4) : (5) : (5) : (2)
: Most-Favored-Nation / World Trade Organisation Normal Tax rate = Favoured Tax rate x 150% : Common Effective Preferential Tariff Scheme / ASEAN Free Trade Area : ASEAN-China Free Trade Area : ASEAN-Korea Free Trade Area : ASEAN-Japan Comprehensive Economic Partnership : Vietnam-Japan Economic Partnership Agreement : Australia-ASEAN-New Zealand Free Trade Agreement : ASEAN-India Free Trade Agreement
Cambodia, Thailand Thailand Cambodia, Malaysia Cambodia, Lao, Malaysia, Thailand Brunei, Cambodia, Philippines, Thailand Malaysia, Thailand
Where the MFN/WTO tax tariff of a goods item specified in the Import Tariff is lower than Special tariff according to different trade agreement, the import tax tariff applicable to such goods item shall be the MFN/WTO tax tariff.
ESTIMATING RULES OF THUMB Structural Design - Concrete Ratios The following is a range of concrete ratios for building superstructure design in Viet Nam Concrete/floor area Formwork/floor area Reinforcement
0.4m3/m2 2.2m2/m2 160kg/m3
to to to
0.5 m3/m2 3.0 m2/m2 250 kg/m3
Average External Wall/Floor Ratio 1.0 m2/m2 0.4 m2/m2 0.4 m2/m2
Residential Apartments Office Hotel Average Internal Wall/Floor Ratio
1.0 m2/m2 0.5 m2/m2 1.5 m2/m2
Residential Apartments Office Hotel Air - Conditioning Average
0.065
RT/m2 of floor area
The above ratios are indicative and for reference purposes only. They do not account for buildings with special shapes, configurations or particularly small footprints. Indicative Dimensions for Sports Grounds Length
Width
Tennis Court 40 m 20 m Squash Court 13 m 6m Basketball Court 38 m 23 m Volleyball Court 30 m 20 m Badminton Court 20 m 10 m Ice Rink 61 m 26 m Soccer Pitch 110-120 m 70-80 m The above dimensions are for a single court with appropriate clearance. No spectator seating or support area has been allowed Densities of Common Materials Concrete 2,400 kg/m3 Water Cement 1,441 kg/m3 Softwood Sand 1,600 kg/m3 Hardwood Gravel 1,350 kg/m3 Aluminium Steel 7,850 kg/m3 Soil (compact)
1,000 700 1,100 2,750 2,100
kg/m3 kg/m3 kg/m3 kg/m3 kg/m3
Concrete Strength (in accordance with TCVN 3118 - 1993) CYLINDER CUBIC CYLINDER CUBIC 15cm x 30cm 15cm x 15cm 15cm x 30cm 15cm x 15cm Psi Mpa Mpa Mpa Psi Mpa 8,000 55 66 60 8700 50 7,000 48 58 50 7300 42 6,000 41 49 40 5800 33 5,000 34 41 35 5100 29 4,000 28 34 30 4400 25 3,000 21 25 25 3600 21 8,000 55 66 20 2900 17 15 2200 13 1.00MPa = 145.04 Psi 1.00 MPa (Cylinder 15cmx30cm) = 1.20 MPa (Cubic 15cmx30cm) Reinforcement Bar Dia. Weight/m Perimeter Area (mm) (kg/m) (mm) (mm2) 6 8 10 12 16 20 25 32 40
0.222 0.395 0.616 0.888 1.579 2.466 3.854 6.313 9.864
18.85 25.13 31.42 37.70 50.27 62.83 78.54 100.53 125.66
28.27 50.26 78.54 113.10 201.06 314.16 490.88 804.25 1256.64
Composition of Concrete (per m3) Mix Cement 1:3:6 216 kg 1:2:4 308 kg 1:1:2 540 kg Average Loads Lorry (24 ton) Concrete truck (24 ton) Barge
Sand 0.45 m3 0.43 m3 0.38 m3
Aggregate 0.90 m3 0.86 m3 0.75 m3 Volume 10.0 m3 5.5 m3 200 – 1,450 m3
Dimensions for Standard Parking Space, Loading / Unloading Bays and Lay-bys Length
Width
Minimum Headroom
Private Cars, Taxis and 5m 2.5 m 2.4 m Light Vans Coaches and Buses 12 m 3.0 m 3.8 m Lorries 11 m 3.5 m 4.1 m Container vehicles 16 m 3.5 m 4.5 m Minimum headroom means the clearance between the floor and the lower most projection from the ceiling including any lighting units, ventilationi ducts, conduits or similar.
BUILDING CONTROL AND PROCEDURES Project Classification Projects are categorized based on the scale, nature and source of fund in accordance with Appendix 01 of the Decree 12/2009/ NDCP dated 02 October 2009. Special projects under the jurisdiction of the Prime Minister’s Office encompass the most national important project and or top security project. Projects classified as Group A under the jurisdiction of the Ministers of Ministries encompass infrastructure and ports (sea-ports and airports), oil and gas, cultural and sensitive projects to national defense and all projects over VND 500 billion, or equivalent to USD 25 million. Group B projects encompass all other projects and fall under the jurisdiction of Provincial People’s Commit-tees and require registration only for investment licenses and applies to projects with a manufacturing and export earnings component. A full assessment for investment licenses is required for all other projects. The table on page 89 shows the step by step licensing required for projects categorized as Group B requiring full assessment. Project Investment Appraisal Developers must carry out the project investment report (feasibility study report) and the basic design for project investment appraisal including the Planning Certificate applied to the People’s Committee of the relevant province. The information of basic design to be included encompasses address and description of land plot, function of land plot, red-line boundary and exit and connection with the existing transportation and infrastructure including power, water, storm water drainage , waste water treatment, overall dimension and existing level, construction boundary, construction density, plot ratio, schedule of land use area and schedule of floor area, maximum floor height and building height, parking lot ratios, principle of architec-tural, structure and infrastructure design, environmen-tal impact plan, fire protection plan, design standards and building codes. The project investment appraisal is in accordance with the Circulation 03/2009/ TT-BXD dated 26 March 2009. Technical Design and Detailed Design Developers using foreign design consultancies must ensure their projects undergo a Design Evaluation Assessment to the Ministry of Construction or the Chairman of the Peoples Committee of relevant province who will delegate to the Ministry of Construction or provincial Construction Department. The Technical Design and Detailed Design must be in line with the previous approved basic design including the compliance of design standards and building codes, the integrity of project, the well protection of environ-ment and the safety in the event of fire circumstances. Construction Permit Under the Law on Construction investors must first obtain a construction permit issued by the Provincial People’s Committee Construction Department prior to construction can commence. The construction permit is not required for the projects of residential develop-ment, industrial and processing zones, hi- tech parks, housing development of which the master plan 1/500 was approved by authority. There are also a few exceptions to this in case of residential developments which shall be governed by newly published laws of Residential.
The investor of residential development projects shall submit an application dossier of all the mentioned inclusion plus the certificate of EIA (Environment Impact Assessment) and Fire Protection, which are issued by the Provincial Department of National Resources and Environment and Provincial Fire Police Department respectively. An application dossier shall contain design implementation drawings and land-use right certificates and land rental contracts. The basic inclusions are mandatory and they are location and description of works, storey height and height above sea-level, site boundary demarcation, overall site plan, major cross sections, main elevations, structural framing plans and foundation designs, environmental and safety technical details, principle of materials, schematic line diagrams of infrastructure connection of power, telecommunication, water supply, storm and waste water drainage system, and quantities for key components.. Construction Permit applications will be checked against various compliances in respect of boundaries and interference with neighboring properties and approved planning (site coverage, plot ratio and car-parking). The issuing body should provide timely notice to the investor of any non-compliance for their remedy and resubmission to allow the implementation stage to commence. Site Clearance A plan for site clearance and/or resettlement shall be submitted at the same time as the application for the investment license and resettlement carried out prior to site clearance taking place for construction. The time limit for site clearance should comply with the project implementation schedule. Resettlement is based on the principle of providing similar or better conditions and governmental regulations on principles, methods and a price framework shall be adopted by the People’s Committee for determination of compensation levels. This is a matter for great uncertainty and foreign investors are advised to seek vacant possession prior to transfer of land use right to the joint venture. Supervision of Construction Independent Supervision of construction works by a competent and registered firm is a mandatory requirement. The supervisory role encompasses quality control and compliance checking, schedule control, quantification control, safety and environmental hygiene control during construction. The safety and environment control are conducted regularly and continuously during the implementation phase. The Supervisor is also responsible for arranging independent inspections witnessing of testing and commissioning data and assistance in compilation of the dossier for putting the building into operation and receipt of the Occupation Permit. Commencement of Construction Construction of works may only commence after satisfying the following conditions : the site area being ready to be handed over, either in whole or in section and free of encumbrances; a construction permit; approved design drawings for execution of building; aconstruction contract; sufficient capital funds to ensure the building schedule in accordance with the approved building schedule in the investment license; measures to ensure safety and minimum environmental impact during the construction process. Construction All Risks and Third Party Liability Insurances as well as all required insurances in accordance with conditions of contract are recommended to be effected prior to commencement of any physical construction works on Site.
contracts which are placed by the employer. This necessitates effective cost management as the total construction budget is not finalized until the final packages are let. The employer bears not an insignificant risk in terms of price certainty, delays, disruption, design and coordination problems. Clients adopting this approach need to be conversant with the local environment and have the requisite in-house skills to deal with issues as they arise. c) Framework Agreements Framework agreements referred sometimes as “call-off” contracts between investors with a “pipe-line” of projects and contractors can result in significant savings to both parties using any of the procurement options above. The advantages are time reduced for tendering and negotia-tions, improved processes and knowledge transfer, bulk order costs savings, reduced confrontation and economies of scale due to continuity of workflow. All these advantages are extremely important in the Vietnam context because it is of paramount importance to maintain healthy relation-ships between employers and contractors as unforeseen events are prevalent during the design and procurement stages in Vietnam. d) Public Private Partnership (PPP) PPP is the generic term for the relationships formed between the private sector and public bodies often with the aim of introducing private sector resources and / or expertise in order to help provide and deliver public sector assets and services. The term PPP is used to describe a wide variety of working arrangement from loose, informal and strategic partnerships to design, build, finance and operate type services contract and formal points of joint venture companies. The PPP mechanisms would help attract commercial capital and other sources of capital that private investors will seek for PPP projects. In that way, investment efficiency will be improved while public debts controlled at safe levels. Investors of projects will be chosen via competi-tive bidding in order to maximize benefits and create equal opportunities for domestic and foreign investors. On 9 November 2010 the Prime Minister of Vietnam authorized the issue of detailed regulations covering the piloting of investment in the form of Public Private Partnerships (PPPs) in Vietnam. The PPP Regulations became effective on 15 January 2011 and will continue to be implemented over the next three to five years. The Vietnamese Government intends to carry out PPP programme according to a list of defined projects to ensure that investors are provided with carefully prepared projects with a view to creating a real PPP commercial market in Vietnam. In the coming years the government will carry out some pilot projects. The PPP projects in the country will concentrate on core techni-cal infrastructure that requires much capital, and furthermore, mechanisms to mobilize private invest-ment: (i) Roads, Road bridges, road tunnels, ferry road stations; (ii) Railway, railway bridges, railway tunnels; (iii) Airports, sea ports and river ports; (iv) Clean water supply systems; water drainage systems; liquid and solid waste collection and treatment systems; (v) Power plants, electricity transmission cables; (vi) Hospitals; (vii) Other infrastructure projects.
Table A - Procurement Strategy Project Criteria Paramter
Objectives
Timing
Early Completion
Cost
Appropriateness of Contract Strategy PPP
Traditional
Management Contracting
Construction Management
Design and Construct
Prime Contracting
Pre construction price certainty
Quality
Design prestige
Variations
Avoid prohibitive cost of change
Complexity
Technically advanced or highly complex building
Responsibility
Single contractual link
Professional Responsibility
Need for design learn to report to sponsor
Risk Avoidance
Desire to transfer complete risk
Damage Recovery
Facility to recover costs direct from contractor
Build ability
Contractor input to economic construction
Table B - Risk Allocation INDICATIVE RISK ALLOCATION Contract Strategy Client
Public Private Partnerships
Design and Construct
Prime Contracting
Traditional
Framework Agreements
Management Contracting
Construction Management
Contractor
Framework Agreements
CONTRACTOR SELECTION STRATEGIES There are four tiers of contractor available for tendering foreign investment projects, these tiers are not official classifications. Tier 1
Foreign contractor from Japan, Korea, Singapore, Hong Kong, Europe Australia
Tier 2
Foreign contractor from China, Russia, Taiwan and Malaysia
Tier 3
Local private and Joint Stock contractors
Tier 4
State contractors
There is a considerable diversity between these tiers in terms of general expertise, technological know-how, human-resource skills and training which leads to a different risk profile for delivery of buildings to time, quality and cost targets. The lowest tiers use less modern equipment, machinery and system formwork and have much lower human resource costs. This is inevitably leading to higher tender returns. A rigorous pre-qualification procedure is recommended with weighted scoring in line with project objectives eg. lowest cost objective will have an inevitable impact on quality and time. A typical pre-qualification assessment might cover (indicative weighting for Vietnam 1 through 10, 10 highest) - Vietnam experience (if foreign) 8 - Project type experience (local and foreign) 7 - Financial capacity (particularly local) 8 - Plant and equipment inventory (particularly local) 7 - Direct labour strength (local and foreign) 6 - Proposed joint venture / sub-contracting arrange-ments (local and foreign) 7 - Planning and programming capability (particularly local) 8 - Cognizance of international procedures, codes and specifications (local) 8 Financial capacity (local) Local contractors now have access to bank funding but should not be expected to finance projects by punitive cash-flow arrangements. Most contracts are let with investors paying 10-15% advance payments which is re-couped from subsequent milestone or interim payments. Deductions for defective works and liquidated damages may compound problems so careful diplomacy is often more productive. Claims for additional costs due to prevailing market conditions are more common in today’s climate but also for misinterpretation of contract obligations making the need for good quality contract documentation essential. Plant and Equipment Inventory (local) State firms tend to share or pool plant and equipment for example tower-cranes and piling rigs. It is often impossible to determine the true owner of plant and equipment on-site in the event of premature demobilization.
It is essential that the pre-qualification process determines that a contractor owns plant of sufficient size, capacity and suitable state of repair as contractors may not have full control of leased equipment suddenly required on other job-sites. Direct labour strength (local) The source of labour supply, also being verified as labour strength, may be “topped-up” by importing unskilled and untrained workers from remote provinces, who often are not legally resident at their working destination. Contractors should be asked to prove their direct labour records and declare any labour only sub-contracting arrangements. The tier 1 contractors will not have any full-time dedicated labour on their payroll. Tier 2 contractors often import workers from their home country for the project duration and shall be responsible for all associated costs and taxes. Labour is not usually permitted to reside on site. Contractors shall provide details of training curriculums for each trade discipline when tendering as well as health and safety programmes. Proposed sub-contracting arrangements (local) Sub-contracting is prevalent in Vietnam so it is essential to check the percentage of work subcontracted out to ensure quality control issues are minimized. It is highly unlikely that any one firm will possess the required human resource and plant and equipment to complete a project using in-house resources. Foreign contractors largely act as management function providing only project engineers, site supervisors, health and safety officers and planners. Both foreign and local contractors rarely directly employ foremen, gang-leaders or indeed skilled and unskilled operatives. These arrangements are perfectly normal and accepted but it is preferable to know in advance the exact arrangements being proposed to ensure no conflicts of interests with other projects and to understand fully the amount of “control” the appointed contractor has on the works he is engaged to undertake. Planning and programming capability (local) This capability needs careful verification from the lowest tier contractors. The use of first principle time resourced planning is rarely used. The approach adopted is often “rule of thumb” whereby planners determine critical activity durations using their knowledge of other projects. Floor/structure cycle times are often inconsistent and the lack of recording and reutilization of historical data means the planning process can be crude at best. Time or delay is a perennial problem in Vietnam sometimes due to employer delays such as site clearance or permit issues or neutral delays such as weather but contractor culpable delays should not be of any surprise. The use of critical path analysis, planned impacted analysis, window analysis and collapsed asbuilt are not widely known in Vietnam. This means time recovery analysis and the implementation of acceleration measures are not readily adopted and time for completion can become unpredictable. The input of experienced Project Management might be invaluable in reducing delays and formulating time recovery plans.
International experience (local) The influx of foreign invested projects has brought with it an influx of different standards and procedures normally from the source country. It is essential to determine the degree of exposure local contractors have had to international standards, procedures and indeed expectations. The Vietnamese Codes and Standards whilst detailed need to be used concurrently with international standards such as American, Australian, British or Japanese standards and specifications as they are not comprehensive enough to “stand-alone” on an international standard project. There is no uniform and widely accepted standard or specification. The nett result is a hybrid where every project has a unique and bespoke set of standards depending on the investor and his consultant source country. The appointed design team will naturally look to use their familiar “off the shelf” specifications and tendering contractors should be asked to list the standards they have successfully built for the key trades and building elements. There is a move to produce a set of consolidated Vietnamese standards but this is some way off and the hybrid approach will continue for some time to come. However, no international standard shall over-ride any mandatory Vietnam building code or standard. Design consultants should provide a translated bi-lingual version of their specifications and locally registered design firms shall provide “localization” of the design to obtain local approvals. The contractors should also be asked to list investments such as system formwork and their use of recent technology and list previous employers and consultants whom they have worked with.
PROPERTY OVERVIEW OVERVIEW Similar to the economic picture in 2010, Vietnam’s economy witnessed both growth and macroeconomic instability in 2011. The yearend growth rate was 5.89%, failing to meet the target of 6%. This is approximately 0.7% lower than the growth in 2010. Inflation remained atop of many newspaper headlines during 2011, with the y-o-y average for the year ending at 18.58%. A necessary consequence of this was the tightening of monetary policy. Both factors contributing to the limited growth that was witnessed. In 2011 there was a steep devaluation of the dong after Tet, with the currency losing 9.3% of its value on Febru-ary 11 against its USD peg. From an exchange rate of 19,500VND/US$ in early January, the dong devalued to 21,021VND/US$ in late December. In the fourth quarter the State Bank of Vietnam was slowly devaluing the dong by approximately 10 dong per day. With global economies showing signs of strain at the beginning of 2012, and Vietnam continuing to resolve macroeconomic instability, many organisations are beginning the year by maintaining a cautious approach to their business and investment models. OFFICE SECTOR At the end of 2011, average Grade A rents in HCMC were US$32.16 psm per month, a y-o-y decline of just over 8%. The continued decline, represented twelve straight quarters of rental declines. Demand in early 2012 is expected to be moderate as global economies remain in limbo and as the Vietnam-ese economy continues to stabilise. Absorption 2011 will not come close to the record net absorption seen in 2010. There will, however, be an opportunity for corporate occupiers to obtain attractive rents during this period of limited activity. Looking towards late 2012. Grade A rents are expected to stabilise due to tight supply, and possibly improve if there is sustained economic growth – this is despite possible new supply from Saigon One ( M & C) and Times square. If Vietcombank Tower, and the Ben Thanh Twin Tower project come online as scheduled, within the next eight quarters, their new supply would equal approximately 32% of current Grade A supply. This will almost certainly put downwards pressure on rentals during the period. However, the Ben Thanh Twin Tower project is currently only in the compensation phase, and progress on the Vietcombank Tower is measured. Therefore, Grade A rents could appreciate in the next eight quarters as the new supply coming online in 2012 is absorbed, and future supply is a full two years, or more, away. The new Grade A projects coming online in the next eight quarters are expected to set a new level of quality, which is desired by the market and required by many multinational corporations to comply with life, health and safety standards. In this respect, occupiers of current Grade B projects are expected to take advan-tage of this opportunity to relocate into the newer, higher quality space.
RESIDENTIAL SECTOR The residential sector generated the most headlines during 2011. Developers who had moved into the development cycle, with what could often be considered speculative product, faced a market with notable levels of falling confidence during 2011. With macroeconomic policy tightening developers have had limited access to capital and with buyer appetite being low, numerous developers have faced cash flow issues through the year. Sales velocities were less than expected and as such developers had to look to adjust strategies towards the year end. There were a number of different options considered and deployed which included, the postponement/slowing of construction, the attempted sale of units en-bloc to investors, the transfer of units to serviced apartment operators, the self operation of units or discounts/incentives or various types. For a limited number of developers the measures that have been taken have provided shelter from the market conditions, but for many developers, cash flow is still a concern and it is expected that in early 2012 that the residential market will continue to provide headlines as developers navigate the tricky conditions being faced. Despite the lacklustre market conditions it is noted that overall asking prices have not fallen as much as some may have expected. On the secondary market the greatest price falls were seen in the mid-end sector where prices fell by 7.5%, where as the affordable sector saw asking prices stay stable over the year. It is however noted that the actual transactional price in both the primary and secondary market has adjusted more than the asking prices as sellers look to close prospects. RETAIL SECTOR In 2011 consumer confidence waned due to persistent high inflation. Although the Government’s efforts to contain inflation gradually worked their way through the economy, the high inflation seen through the year stifled consumer’s appetite to spend. Department store rents continued to climb as landlords felt they could charge a premium. Parkson, which continued to expand in 2011, has seen success at a number of its outlet as consumers and retailers alike have shown a preference for their format. In the first half of 2012 retail sales are expected to remain flat. Landlords, especially in shophouses and non-CBD shopping centres, will be forced by market realities to become more reasonable with their rental rates. Department stores will be able to hold their rental rates in the same period. New retail options will need to offer attractive rents to attract retailers. Through 2012 it is expected that the gap between what is provided by landlords and what is required by tenants will narrow, with more attention paid to seemingly small things such as toilets and taxi stands, foot traffic can be increased. SERVICED APARTMENT SECTOR The Serviced Apartment sector has proved to be one of the most resilient, in what has proved to be a tough year for the majority of sectors. Grade A rents have stayed stable, with less than 1% change over the year, this is a reflection of stable demand and
limited supply. With the premium Times Square project expected to come online in the second quarter of 2012, Grade A supply will increase by approximately 20%. Despite this additional new supply, Grade A rents are expected to be flat or possibly see increases. This is due to the low vacancy, as most Grade A projects have seen vacancy rates less than 10% for the last six quarters. Projects that break the trend of maintaining high rentals in the premium CBD product sector, may have an opportunity to fill their projects quicker than those that hold out for higher rents. Through 2012 demand for serviced apartments is expected to remain strong. Vietnam is an emerging destination for companies looking to place expatriate staff, with an increasing standard of living for foreigners but a lower cost of living compared to the regional hubs of Singapore and Hong Kong. Vietnam is also expected to capitalise on regional trends including the diversification of manufacturing out of Japan after the earthquake and tsunami, and the rising cost of doing business in China, where an increase in the minimum wage is pushing manufacturers to look at other areas for expansion. Recent data reported by Oxford Economics indicates that textile exports from Vietnam in the first eight months of 2011 were up 29% y-o-y, and coffee exports were up 9% y-o-y in the first seven months of 2011. This all bodes well for Vietnam, but our forecast of high serviced demand is tempered by the uncertainty surrounding the global economy at the turn of the year.As serviced apartment demand depends heavily on expatriates continuing to be posted to Vietnam, it is perhaps more directly affected by the global economy than other sectors. Since our last forecast three months ago there has been a significant increase in the likelihood of a recession in the United States and a disorganised Eurozone debt default. The uncertainty around the outcome of Greece’s sovereign debt crisis is increasing, and in the United States political posturing abdicates the will to implement the reforms necessary to stabilise the economy and promote growth. If the already fragile global recovery falters, there may be a reduction in expatriate staff, which would increase vacancy in the serviced apartment market. (Reproduced by kind permission of CB Richard Ellis)
PROJECT CLOSED OUT PROCEDURES Before an investor can receive rental income and occupy the premises for its intended use, the receipt of approval must be received by the provincial Construction Department or the Ministry of Construction depending on the category and size of the project. The Construction Department will receive a dossier complete with independent testing and commissioning data (prepared by an independent party not the original designer) for piling, structure, electricity and earthing, environmental impact with regard to water and waste disposal, final checking and approval of fire protection requirement. The dossier needs to have Minutes to Put the Building into Operation signed by the Investor, Testing Body, Contractor and Designer including the Project or Construction Manager if appointed.
TYPICAL SUBMISSION FLOWCHART LOCAL PARTNER
FOREIGN PARTNER
ESTABLISHMENT OF LEGAL COMPANY PT: 1 month AT: 1.5 month Total : 2.5 months
SUBMIT & OBTAIN IN-PRINCIPLE APPROVAL OF THE LOCATION / PROJECT FROM MASTER PLANNING DEPT.
PT: 0.5 month AT: 2 months
SIGN A JV CONTRACT & AGREEMENT FOR FUTURE TRANSFER OF ASSETS
Total : 2.5 months
SUBMIT & OBTAIN APPROVAL FOR THE DEVELOPMENT PLANS (LAND USE) FROM RESOURCES AND ENVIRONMENT DEPT. PT: 0.5 month AT: 3 months Total : 3.5 months
REGISTER A JV COMPANY - SUBMIT AND OBTAIN APPROVAL FOR RED BOOK TRANSFER FROM LOCAL PARTNER TO JV CO. FROM RESOURCES AND ENVIRONMENT DEPT.
PT: 0.5 month AT: 1.5 month
- SUBMIT AND OBTAIN APPROVAL FOR INVESTMENT LICENSE FROM DEPT. OF PLANNING & INVESTMENT
Total : 2 months
- SUBMIT AND OBTAIN APPROVAL FOR FIRE FIGHTING APPRAISAL FROM FIRE FIGHTING DEPT. - SUBMIT AND OBTAIN APPROVAL FOR ENVIRONMENTAL IMPACT APPRAISAL FROM RESOURCES AND ENVIRONMENT DEPT.
PT: 1 month AT: 4 months Total : 5 months
SUBMIT AND OBTAIN APPROVAL FOR PLANNING TASK AND PLANNING APPROVAL SCALE 1/500 FROM PEOPLE COMMITTEE OF THE DISTRICT PT: 1 month AT: 2 months Total : 3 months
SUBMIT AND OBTAIN APPROVAL FOR BUILDING PLANS FROM CONSTRUCTION DEPT.
Legend:
PT: Preparation Time AT: Approval Time
Note:
Time indicated is based on past project experience and serve as a guide only
PLOT RATIOS AND SITE COVERAGE FOR BUILDINGS (Land area over 500m2)
Average number of storeys
Maximum of Site coverage (%)
Maximum of Plot ratio
1
70
0.70
2
60
1.20
3
53
1.59
4
47
1.88
5
40
2.00
6
39
2.34
7
36
2.52
8
33
2.54
9
31
2.70
10
28
2.80
11
26
2.86
12
24
2.88
13
22
2.90
14
21
2.94
>=15
20
3.0 – 5.0
Car Parking Space Type of building - Hotel from 3-Star standard upward - High-grade office, foreign affairs offices - Super market, big shops, conference centre, exhibition, show room - High grade condominium
1 space of carparking (25m2) for every 5 guest rooms every 150m2 floor area every 75m2 floor area every apartment
KEY DESIGN CRITERIA Plot Ratios and Site Coverage I. High-rise building : Pursuant to the TCXDVN 323 : 2004 promulgated to Decree 26 dated 2 November 2004 of Ministry of Construction on “Design standard for high-rise building” and Decree No 21/2006/QD-BXD dated 19 July 2006 of Ministry of Construction on amending and supplementing articles of TCXDVN 323 : 2004 as follows : Plot Ratios and Site Coverage: - The site coverage of high-rise building must be less than 40%. - The plot ratio is less than 5.0. - Other cases will be applied to the detail planning approved by authorities. Parking space: - Car parking space: 1 car parking space / 4 to 6 units with standard area 25m2/car - Motorcycle parking space: 2 motorcycles / unit with standard area 2.5 to 3m2/motorcycle. - Bicycle parking space: 1 bicycle/ unit with standard area 0.9m2/bicycle. Height from floor to ceiling soffit : - > 3m but < 3.6m. - In some high standard building, the height from floor to ceiling soffit may be lower, but not less than 2.7m. Road for fire protection : - Width of road > 3.5m. - Clearance Height > 4.25m. - Area for making U-turn > 15x5m II. Non High-rise building : Pursuant to the Vietnamese building code volume 1 promulgated to Decree 682/BXD-CSXD dated 14 December 1996 and Decree 04/2008/QD-BXD dated 03 April 2008 of Ministry of Construction on amending and supplementing articles of TCXDVN 323 : 2004 as follows : Ratio (%) Maximum of site coverage
Minimum of Landscaping ratio
1. Dwelling House - Villa - Condominium
30 50
40 20
2. Public building - Kindergarten, School - Hospital - Culture house - Religious constructions
35 30 30 25
40 40 30 40
3. Factory - Scattered construction - Combined block
50 70
20 20
Type of building
BUILDING AREAS DEFINITIONS The following guidelines are derived from the RICS “Code of Measuring Practice: A Guide for Surveyors and Valuers. 5th Edition' and the RICS 'Standard Form of Cost Analysis, Principles, Instructions and Definitions”. Gross External Area (GEA) Gross External Area is the area of a building measured externally at each floor level. Includes: Perimeter wall thicknesses and external projections Areas occupied by internal walls and partitions Columns, piers, chimney breasts, stairwells, liftwells, and the like Atria with clear height above, measured at base level only Internal balconies Structural, raked or stepped floors are to be treated as a level floor measured horizontally Horizontal floors, whether accessible or not, below structural, raked or stepped floors Mezzanine areas intended for use with permanent access Lift rooms, plant rooms, fuel stores, tank rooms which are housed in a covered structure of a permanent nature, whether or not above main roof level Outbuildings which share at least one wall with the main building Loading bays Areas with a headroom of less than 1.5m Pavement vaults Garages Conservatories Excludes: External open-sided balconies, covered ways and fire escapes Canopies Open vehicle parking areas, roof terraces, and the like Voids over or under structural, raked or stepped floors Greenhouses, garden stores, and the like in residential property Gross Internal Area (GIA) Gross Internal Area is the area of a building measured to the internal face of the perimeter walls at each floor level. Includes: Areas occupied by internal walls and partitions Columns, piers, chimney breasts, stairwells, lift-wells, other internal projections, vertical ducts, and the like Atria with clear height above, measured at base level only Internal open-sided balconies and the like Structural, raked or stepped floors are to be treated as a level floor measured Horizontal floors, with permanent access, below structural, raked or stepped floors Corridors of a permanent essential nature (e.g. fire corridors, smoke lobbies, etc.) Mezzanine areas intended for use with permanent access Lift rooms, plant rooms, fuel stores, tank rooms which are housed in a covered structure of a permanent nature, whether or not above main roof level
Service accommodation such as toilets, toilet lobbies, bathrooms, showers, changing rooms, cleaners' rooms, and the like Projection rooms Voids over stairwells and lift shafts on upper floors Loading bays Areas with a headroom of less than 1.5m Pavement vaults Garages Conservatories Excludes: Perimeter wall thicknesses and external projections External open-sided balconies, covered ways and fire escapes Canopies Voids over or under structural, raked or stepped floors Greenhouses, garden stores, fuel stores, and the like in residential property Gross Floor Area (GFA) Gross Floor Area is the total of all enclosed spaces fulfilling the functional requirements of the building measured to the internal structural face of the enclosing walls. Includes: Areas occupied by partitions, columns, chimney breasts, internal structural or party walls, stairwells, lift-wells, and the like Lift, plant, tank rooms and the like above main roof slab Note: Sloping surfaces such as staircases, galleries, tiered terraces and the like should be measured flat on plan. Excludes: Any spaces fulfilling the functional requirements of the building which are not enclosed spaces (e.g. open ground floors, open covered ways and the like). These should each be shown separately Private balconies and private verandahs which should be shown separately Net Internal Area (NIA) Net Internal Area is the usable area within a building measured to the internal face of the perimeter walls at each floor level. Includes: Atria with clear height above, measured at base level only Entrance halls Notional lift lobbies Kitchens Built-in units, cupboards, and the like occupying usable areas Ramps of lightweight construction to false floors Area occupied by ventilation/heating grills Area occupied by skirting and perimeter trunking Areas severed by internal non-structural walls, demountable partitions, whether or not permanent, and the like, where the purpose of the division is partition of use, not support, provided the area beyond is not used in common Pavement vaults.
Excludes: Those parts of entrance halls, atria, landings and balconies used in common Toilets, toilet lobbies, bathrooms, cleaners’ rooms, and the like Lift rooms, plant rooms, tank rooms (other than those of a trade process nature), fuel stores, and the like Stairwells, lift-wells and permanent lift lobbies Corridors and other circulation areas where used in common with other occupiers or of a permanent essential nature (e.g. fire corridors, smoke lobbies, etc.) Areas under the control of service or other external authorities including meter cupboards and statutory service supply points Internal structural walls, walls enclosing excluded areas, columns, piers, chimney breasts, other projections, vertical ducts, and the like The space occupied by permanent and continuous airconditioning heating or cooling apparatus, and ducting in so far as the space it occupies is rendered substantially unusable Areas with headroom of less than 1.5m Areas rendered substantially unusable by virtue of having a dimension between opposite faces of less than 0.25m Vehicle parking areas (the number and type of spaces noted) Building Footprint ‘Building Footprint’ is not a term defined by the RICS, but is generally understood to mean the area of the land upon which the building sits (excluding all basements), measured to the outside face of external walls.
PROCUREMENT STRATEGIES Overview The primary consideration in the choice of procure-ment strategy is the need to obtain overall value for money during the entire life of the facility and each method has a different risk profile for the employer and contractor. In Vietnam the following is currently prevalent. Traditional Lump Sum Management Contracting Construction Management Design and Construct Prime Contracting Framework Agreements Public Private Partnership (PPP)
-
high extent low extent medium to high extent low extent low extent rising extent new and promoted extent
Most if not all projects in Vietnam are tendered in competition and the process is covered by the Law of Tendering promulgated in 2006 intended primarily for state projects defined as over 30% total investment capital by a state entity and for Vietnamese Privatefirms. Foreign Investors do not need to follow the Law of Tendering although it is advisable. The law recog-nizes open tendering, limited tendering and competi-tive tendering. For state projects tenders are normally sought using a “two-envelope system” i.e. technical and financial the former being opened first to check for compliances. Most foreign entities short-list tendering contractors by having a robust pre - qualification procedure for check-ing financial and technical competencies. Tenders are usually open for 90 days. The FIDIC suite of contracts is widely used for Vietnam construction contracts with the 1999 Red Book being now widely accepted. There are official translations of some of the FIDIC forms and the Vietnam Consultant Association (VECAS) is an official member of FIDIC. Most Official Development Aid (ODA) projects in Vietnam adopt FIDIC also. a) Traditional Lump Sum Most contracts are let in Vietnam on a lump sum basis using a modified FIDIC Contract which in its unamended form is a measure and value contract. This method requires appointment of independent design consultants by the employer and a sufficiently developed design preferably “frozen” prior to tender. Bills of Quantities are usually provided for “information only” to the contractor who normally provide their own quantities with their tender for comparison purposes only and only the rates are contract rates with any “errors and omissions” not being subject to remeasurement after the lump sum is finalized. Prime costs sums for nominated subcontracts for mechani-cal and electrical and lift sub-contracts are widely used. b) Construction Management This form of procurement is often portrayed as “fast-track” as tender packages are often let successively throughout the design process with no need to wait until detail design is complete. A construction management consultant is engaged normally for a fixed percentage fee to procure and manage the individual trade
LANGUAGE Vietnamese was declared the official language of Vietnam in 1945, as much as 70% of the vocabulary is borrowed from Chinese and the intonation is similar to Cantonese. It is spoken by approximately 90% of the Vietnamese population and ranked as the world’s 15th most spoken language. English, however, is widely used in the business community.
ACCOUNTING SYSTEM Foreign-invested business entities are generally required to adopt the Vietnamese Accounting System ("VAS"). If a company strictly follows the VAS, registration with the Ministry of Finance ("MoF") is not required. However, if the VAS is modified, a written approval from the MoF is required before implementation.Accounting records are required to be maintained in VND. A foreign-invested business entity can self-assess to select a foreign currency to be used for its accounting records and financial statements and notify its local tax authority. Accounting records are required in Vietnamese language, although a commonly-used foreign language can be used at the same time along with the Vietnamese language. The annual financial statements of all foreign-invested business entities must be audited by an independent auditing company operating in Vietnam. Audited annual financial statements must be completed within 90 days from the end of the year.
WORKFORCE The population of Vietnam is circa over 87 million (as the Population forecast of Vietnam stating in the book edited by General Statistics Office) with a labour force estimated at 50 million, literacy rates are one of the highest in the region. The Ministry of Labour, Invalids and Social Affairs “MOLISA” for short is responsible for all labour related issues and sets the minimum age for full-time employment is 15 years old. The minimum wage for FDI enterprises is USD 96 per month (Pursuant to the Decree No. 07/2011/NĐ-CP of the Government dated 22nd August 2011), whereas the actual monthly payment for FDI enterprises is as high as over USD 100 per month in Ho Chi Minh City. Working hours are 8 hours per day, 6 day working weeks have largely been replaced by 5 day working weeks and 12 days annual leave plus statutory public holidays. Vietnam having strong socialist origins has quite heavy protectionist policy for Vietnamese working for foreign entities and employers must pay 16% of basic salary for Social insurance plus 3% of basic salary for Health insurance, and 1% of basic salary for Unemployment insurance. The Social insurance rate will increase by 17% from 2012 to 2013 as Article No.71 of Social Insurance Law. Most staff will quote salaries net meaning their expected take-home money. Thirteenth month bonus is discre-tionary but largely expected.
SOME INTERESTING FACTS Vietnam’s history can roughly be divided into the following periods: Pre-history: from circa 400,000 years (Palaeolithic) to 4,000 years (Neolithic) ago, cultures in the area included Son Vi, Hoa Binh, Bac Son, Ha Long, and Hoa Loc. Proto-history: According to legends, Vietnam originated in the seventh century BC when the Hung Kings founded Van Lang. In the third century BC, King An Duong Vuong named founded Au Lac and ruled until 179 B.C. Chinese Occupation: Vietnam was occupied by China from the first to the tenth century A.D. Monarchy: Kings rules the area from 968 to 1945. Independence: The Socialist Republic of Vienam was founded after the 1945 revolution, when President Ho Chi Minh declared independence. French War: Vietnam battled French colo-nialism from 1858 to the August Revolution in 1945, and from 1946 to the victory at Bien Bien Phu in 1954. American War: Vietnam fought America from 1954 to Ho Chi Minh’s victory on April 30, 1975. From 1975 until now: Vietnam has been working towards development and success.
VIETNAM KEY DATA Government Country Name Head of State Government Type Head of Government Capital City Administrative Divisions Independence Legal System Official Language National Language
: The Socialist Republic of Vietnam : President : Socialist Republic : Prime Minister : Hanoi : 64 provinces and central cities : 2nd September 1945 : Based on Constitution of Vietnam : Vietnamese : Vietnamese
Geography Geographic Coordinates : 16 00 N, 106 00 E Location : South East Asia Border Countries : Cambodia 1,228 km, China 1,281 km, Laos 2,130 km Total Area : 331,210 sq km Land Area : 310,070 sq km Water : 21,140 sq km Land use : arable land 20.14% permanent crops 6.93% other 72.93% Irrigated Land : 30,000 sq km (2003) Coastline : 3,444 km (excludes islands) Land boundaries : 4,639 km Natural Resources : phosphates, coal, manganese, bauxite, chromate, offshore oil and gas deposits, forests, hydropower Climate type : tropical in south; monsoonal in north with hot, rainy season (mid-May to mid-September) and warm, dry season (mid-October to mid-March) Natural hazards : occasional typhoons (May to January) with extensive flooding, especially in the Mekong River delta People Total Population Age structure from 15 years
: 86.93 million ( 2010 est.) : 15-24 years 18.3% 24-49 years 61.4% 50 years and over 20.3% Population Growth Rate : 10.3‰ Median Age : total: 27.4 years male: 26.4 years female: 28.5 years (2010 est.) Life Expectancy : 71.94 years male: 69.48 years female: 74.69 years (2010 est.) Urban Population Hanoi : 6.56 million (2010 est.) Ho Chi Minh City : 7.4 million (2010 est.) Ethnic Groups : 54 Ethnic Groups Kinh (Viet) 86.2%, Tay 1.9%, Thai 1.7%, Muong 1.5%, Khome 1.4%, Hoa 1.1%, Nun 1.1%, Hmong 1%, others 4.1% (1999 census)
People (Cont’d) Languages
Literacy (definition: age 15 and over can read and write) Population below poverty line Labor Force Labor Force by occupation Unemployment Rate
: Vietnamese (official), English (increasingly favored as a second language), some French, Chinese, and Khmer; mountain area languages (Mon-Khmer and Malayo- Polynesian) : total population: 90.3% male: 93.9% female: 86.9% (2002 est.) : 12.3% (2009 est.) : 50.39 million : Agriculture: 49% Industry: 22% Services: 30% (2010 est.) : 6.45% (2010 est.)
Economy Monetary Unit Currency Code Exchange rate to USD Euro British Pound Average Consumer Price Index (CPI) Fiscal Year GDP (Official Exchange Rate) GDP Growth Rate GDP composition by sectors Trade Total Exports Major Exports Export Partners Total Imports (USD billion) Major Imports Commodities Import Partners International Airports Major Seaports
: Vietnamese Dong : VND dong (VND) per : 20,031 (2011 average) : 27,917 (2011 average) : 32,155 (2010 average) : 18.62% (from Jan to Nov 2011) : 1 January to 31 December : US$ 85.37 billion (First 9 months 2011) : 5.76% (First 9 months 2011) : Agriculture: 21.5% Industry: 40.66% Services: 37.84% (2011 est.) : US$ 87.2 billion (From Jan to Nov 2011) : crude oil, marine products, rice, coffee, rubber, tea, garments, shoes : US 17.7%, EU 16.8%, ASEAN 14% China 9.86%, Japan 9.74% : US$ 96.1 billion (From Jan to Nov 2011) : machinery and equipment, petroleum products, fertilizer, steel products, raw cotton, grain, cement, motorcycles : China 20.4%, ASEAN 18.3%,Korea 10.8%, Japan 8.7%, EU 6.3% : Tan Son Nhat (Ho Chi Minh City), Noi Bai (Hanoi), Da Nang (Da Nang) : Saigon, Hai Phong, Da Nang, Cam Pha, Phu My, Cai Mep
(Source: General Statistics Office)
BANKS The Vietnamese banking system was restructured in the 1990’s separating the State Bank of Vietnam (Central Bank) from commercial banks and paving the way for the entry of foreign banks presently offering a range of banking services comparable to overseas banking facilities. Today there exists the State Bank of Vietnam, State Owned Banks, Joint Stock Commercial Banks, Foreign Bank branches / representative offices and Joint Venture Banks. The law allows foreign entities and individuals to hold foreign currency accounts and local Vietnamese dong accounts. Banks requires document applicable to foreign currency transactions for domestic payment and cross border transfer via capital/current account. Banks can provide customers with all of the guarantee types commonly used in the economy such as bid bond, a performance guarantee, a loan under guarantee by a third party, a deposit guarantee , tax/custom guarantee ...Guarantee fee will be regulated by each bank and depended on guarantee amount and term. Letters of credit are the most commonly used method of transaction for trade. Bank will blockade a part or the whole money amount of client account upon receipt of decision or written request of a competent organizations according to the provisions of law.
GOVERNMENT ADMINISTRATION The National Assembly is the highest representative organ of the people and the highest organ of the state power of the Socialist Republic of Vietnam. Members are elected for a five year tenure through nation wide elections. Sittings of the National Assembly are held twice a year and have full constitutional and legislative powers. The standing committee of the National Assembly is responsible for enforcement of laws. Its functions are carried out through the Ministries, State Committees and General Departments by promulgating and explaining the Constitution, law and decree-laws. The Country’s President is the head of state, elected by the National Assembly from among its members to represent the Socialist Republic of Vietnam in internal and foreign affairs. The Vice President is proposed by the President and elected by the National Assembly from the representatives. The National Defense and Security Council has the duty to mobilize all forces and potentials of the country to defend the Homeland. The Government is the executive organ of the National Assembly and shall report to the National Assembly, the National Assembly standing committees and the Country’s President. The Government consists of the Prime Minister, Deputy Prime Minister, Ministers and Heads at ministerial level. The Prime Minister is presented by the President and elected by the National Assembly and has the term of 5 years. The Deputy Prime Ministers are the assistants of the Prime Minister and may be delegated by the Prime Minister during his absence. The Ministers and Heads at ministerial levels take on the State management of allotted branches or fields.
The People’s Supreme Court is the highest judicial organ of the Socialist Republic of Vietnam. The court consists of the Tribunal President, Vice Tribunal President, judges, the juror and the secretary of the court. Moreover, the court is composed of the judge Council, judge Committee, the Military Court and criminal court, civilian court, the court of appeal and the assistant apparatus.
TAXATION TAXATION IN THE REAL ESTATE INDUSTRY I. Corporate Income Tax (“CIT”) Organizations established in Vietnam deriving income from transferring or leasing property are subject to Corporate Income Tax (“CIT”) at the standard tax rate of 25%. In case of progressive advance payment for purchase of properties under development, real estate developers are required to pay provisional CIT, either at 25% on provisional income if the corresponding expenses can be determined and matched with the revenue, or 2% on revenue if corresponding expenses cannot be determined. Real estate developers generally cannot receive preferential tax rates, tax holidays, or other tax reductions except certain projects with available tax incentives, such as projects located in poor social-economic regions, or projects of construction of residential house for the poors or workers working at Industrial Park, etc. In the event that a lessee pays advanced rent covering several years, the lessor must allocate the advanced rent payment over the number of years for which the lessee paid in advance, effectively matching the income with the rental period for the tax purpose. However, a recent draft Decree on CIT allows the lessor to recognise revenue by two method s (i) on allocated year-by-year basis or (ii) lump-sum basis in the advanced rental collecting year with condition that the lessee shall bear all expenses incurred during the use of the property. Losses incurred in a given year can be consecutively carried forward for 5 years; however, they may not be carried back to previous years. Losses from activities other than real estate cannot be offset against real estate income in both the loss year and the carried-forward period. Land use rights (“LUR”) with indefinite term may not be depreciated as deductible expense upon taxable income determination. LUR with definite term, if accompanied by adequate invoices and documents and lawfully established, which is used in production and business activities, should be gradually amortized over the prescribed land use duration. II. Value Added Tax (“VAT”) The transfer of land use rights (“LUR”) without infrastruc-ture is not subject to VAT. The transfer of LUR with infrastructure/building is subject to VAT at 10%. However, the actual cost of land (or land rent), or the land value at the government tariff (for the case the actual land cost declared by tax payer is determined as not reliable) can be excluded from the revenue subject to VAT. Similar to the treatment of provisional advance CIT payable on advances/deposits received by the developer, output VAT is also fully payable on the advance/deposit.
All construction input VAT incurred can be claimed as input VAT credit (or cash refund during the construction stage). However, input VAT of the expenses related to the value of LUR transfer is not creditable/refundable. III. Stamp Duty Stamp duty is payable at the transfer of title of real estate property by the buyer. Some specific transfers may be exempted from the stamp duty. Stamp duty is imposed at 0.5% on the value of the property but not exceeding VND500million (approx. USD25,000) per asset per transaction. IV. Foreign Contractor Tax (“FCT”) Foreign companies with no legal entity set up in Vietnam (i.e. classified as “Foreign Contractor” or “FC”) supplying goods and services to Vietnamese buyers and deriving income from Vietnam (e.g. construction contractor or project management service) are subject to Vietnam FCT. VAT and CIT are the two components of the FCT. There are three tax filing and payment options: (i) Full registration method with maintenance of books and accounts in Vietnam under Vietnam Accounting system; (ii) Deemed Withholding method and (iii) the Hybrid method which consists of paying VAT on the conventional deduction method like a Vietnamese company, but paying CIT on a Deemed Withholding method basis. The Deemed Withholding method is the most common one in practice under which the contracting Vietnamese party is responsible for registering, withholding, filing and paying the FCT due from each payment made to the FC. The applicable rates vary depending on the nature of goods and services provided. For projects having a substantial portion of local purchases, Hybrid method is often applied via which the FCs can claim credit the input VAT incurred on local purchase, and still pays the CIT on a deemed basis. V. Personal Income Tax (“PIT”) Real estate property (other than sole residential property and some other specific exempt transactions) transfer by individual is subject to PIT. Property transactions subject to PIT include the transfer of “the right to buy”, the transfer of “the right to lease” A Vietnam tax resident has to pay PIT under one of the following two methods: (i) At 25% on the net gain assessed by the difference between the transaction price less the cost and relevant expenses; or (ii) 2% on the transfer price, if the cost can not be determined.The recent update of the relevant tax regulations indicate that (ii) above would apply in most cases. Non-Vietnamese tax residents must pay PIT at 2% of the transfer price. (Reproduced by kind permission of KPMG)
IMPORT Foreign invested entities are permitted to import materials and equipment for their projects in accordance with the conditions laid down in the foreign investment license as determined by the Ministry of Trade. Post licensing procedures involves obtaining an export-import enterprise code from the Department of Customs. Foreign entities must then submit an “Import Plan” annually to the regional service of trade which should be fully encompassing and detailed enough to avoid possible re-application and administrative delays upon arrival to the Vietnam port of entry. Machinery and equipment specified in the investment license may be imported duty free in addition to other materials not available in Vietnam otherwise foreign entities are subject to the common import restrictions and tariffs as stated in “The 2011 Export-Import tax tariff and Value Added Tax on Imports”, applicable from 01/01/2011 based on Decisions, Circulars issued by Ministry of Finance, Free Trade Agreements and published by the HCM General Publisher. This book (readily available) has twenty-one sections covering minerals, foodstuffs, plastics, wood, textiles, stone, plaster and glassware plus more and gives the applicable tariffs for most favored nation status and special preferential treatments namely ASEAN countries. In practice goods are imported under the investors name and license with material and equipment and quantity information provided by contractors.
INSURANCE Overview Most risks that a company would insure anywhere else in the world can be adequately insured for in Vietnam. Rates and terms are generally a function of the world market with due consideration given to local factors however it should be noted that VAT of 10% applies to insurance premiums on policies written within Vietnam. While the overall ability to insure large or complicated risks entirely within Vietnam is limited, the Vietnamese insurance industry can nonetheless insure any size risk through reinsurance arrangements with international reinsurance organisations. The leading reinsurers and those who carry more than 10% have to be rated at least BBB by Standards & Poors or B++ by AM Best or Baa by Moody's or equivalent. Vietnam passed a comprehensive Insurance Law in December 2000 which took effect on April 1, 2001. The Amendment of Insurance Law has been passed last year and was effective as at July 1, 2011. The key changes are focused at keeping up with any WTO commitments such as: the insurance market is profes-sional & open, foreign insurers are allowed to establish a branch in Vietnam or issue an insurance policy into Vietnam. However, the law gives the power to the government to release detailed guidance and to license such transactions. These details are yet to be released as of December 2011 Construction All Risks (CAR) insurance, including the covers for the Contract Work & Third Party Liability, is popular in Vietnam. Recently, owners of larger projects have shown interest in considering more technical coverages such as Advance Loss of Profit (ALoP) / Delay in Start-Up (DSU) insurance to protect their anticipated profit/fixed costs of a particular project.Construction insurance still tends to be left to the contractor to arrange rather than the owner which can give rise to gaps in cover when projects are delayed or split into smaller packages. There may also be gaps when the project passes from construction to operation. Compulsory Insurances in Vietnam Compulsory insurances are regulated in insurance laws & some specialised laws. Below is the consolidation: Insurance Class
Status
PI for Insurance Brokers
Waiting for guidance
PI for Lawyers
Waiting for guidance
PI for Securities Companies (Stockbrokers)
Waiting for guidance
PI for Fund Management Companies
Waiting for guidance
Insurance Class
Status
PI for Architects & Engineers
Waiting for guidance. Government project owners often required & referred to this regulation
PI for Auditing Firms
Waiting for guidance
PI for Evaluation Firms
Waiting for guidance
PI for Public Notary Offices
Waiting or guidance
Construction Works Insurance
Waiting for guidance
Compulsory Fire & Explosion Insurance
Effected. Compulsory wordings & tariff
Environmental Liability Insurance
Waiting for guidance
Aviation’s LIaility Insurance
Effected. Compulsory limits
Compulsory Vehicle Owners’ Civil Liability
Effected. Compulsory wordings, limits & tariff
Travel Insurance for Vietnamese travelling overseas
Waiting for guidance
Technically there is no requirement for worker compen-sation insurance. However since there is a liability regarding employees under the Vietnamese labour law the purchase of worker compensation insurance can act as a risk transfer method to protect against these liabilities. Market Players Insurers There are numerous domestic and foreign companies licensed to provide non-life insurance, including insurance for construction sectors in Vietnam. State-owned:Vietnam Insurance Corp (Bao Viet), Bao Minh Insurance Corp (Bao Minh) Group-controlled: Petro Vietnam Insurance JSC (PVI), Petrolimex Insurance JSC (Pjico), Post & Telecommuni-cation Insurance JSC (PTI), Global Insurance Co. (GIC), Vietnam Aviation Insurance JSC (VNI), Military Insurance Co. (MIC), SHB Vinacomin Insurance JSC (SVIC) Bank-based: Vietinbank Insurance Co. (VietInsco), BIDV Insurance Co. (BIC), Agriculture Bank Insurance JSC (ABIC) Private: Nha Rong Insurance JSC (Bao Long), Vien Dong Assurance Corp (VASS), AAA Assurance JSC (AAA), Bao Tin Assurance Corp (BAC), Hung King Insurance Corp (HKI), Great Mountant Insurance JSC (GMIC) Foreign: Gan-Groupama, QBE, Chartis, ACE, Liberty, Fubon, MSIG, Cathay Joint Venture: Bao Viet Tokyo Marine, United Insurance Co. (UIC – the JV among Bao Minh, Sompo & LG), Samsung Vina Insurance (SVI)
There is only one reinsurer: Vietnam National Insurance Corp (VinaRe). Brokers As insurance is best arranged through a licensed insurance broker who can help companies to assess the underlying risks and then arrange appropriate insurance on their behalf, there are a number of licensed insurance brokers. International: Jardine Lloyd Thompson (JLT), Aon, Marsh, Grass Savoye Willis Local: Viet Quoc, A Dong, Thai Binh Duong, Sao Viet, CIMEICO, Nam A (Reproduced by kind permission of Jardine Lloyd Thompson )
VIETNAM MAP
(Source: Wikimedia)
DOMESTIC ROUTES DISTANCE
FLIGHT TIME
MILES/KMS OUTBOUND RETURN HA NOI TO Buon Ma Thuot
569/960
1:40
1:40
Cam Ranh - Nha Trang
646/1039
1:50
1:50
Da Lat
662/1065
1:40
1:40
Da Nang
377/606
1:15
1:15
Dien Bien
187/301
1:00
1:00
Ho Chi Minh City
707/1138
2:00
2:00
Hue
341/549
1:10
1:10
Buon Ma Thuot
162/260
1:00
0:55
Ca Mau
153/246
1:00
1:05
Cam Ranh - Nha Trang
197/318
0:55
0:55
Con Son - Con Dao
130/210
1:00
1:05
Chu Lai
346/557
1:40
1:40
Da Lat
133/214
0:50
0:50
Da Nang
375/603
1:10
1:10
Ha Noi
707/1138
2:00
2:00
Hai Phong
691/1111
2:00
2:00
Hue
392/630
1:20
1:20
Phu Quoc
187/300
1:00
1:05
Pleiku
238/384
1:15
1:10
Quy Nhon
267/430
1:30
1:25
Rach Gia
121/194
0:50
0:45
Tuy Hoa
237/381
1:15
1:25
Vinh
549/883
1:45
1:45
Buon Ma Thuot
233/374
1:10
1:10
Cam Ranh - Nha Trang
271/436
1:20
1:15
Ha Noi
377/606
1:10
1:10
Ho Chi Minh City
375/603
1:10
1:10
Pleiku
141/227
0:50
0:50
Quy Nhon
171/275
1:00
1:00
HO CHI MINH CITY TO
DA NANG TO
(Source: Vietnam Airlines)
RELEVANT WEBSITES Government Office Ministry of Public Security Ministry of Home Affairs Ministry of Justice Ministry of Planning and Investment Ministry of Finance Ministry of Industry and Trade Ministry of Agriculture and Rural Development Ministry of Transport Ministry of Construction Ministry of Natural Resources and Environment Ministry of Information and Communication Ministry of Labor, War Invalid and Social Affairs Ministry of Culture, Sports and Tourism Ministry of Science and Technology Ministry of Health Ministry of Education and Training Ministry of Foreign Affairs State Bank of Vietnam General Statistics Office of Vietnam Directorate for Standards, Metrology and Quality Vietnam National Administration of Tourism Vietnam Customs Office Vietnam Register Office
http://www.chinhphu.vn http://www.mps.gov.vn http://www.moha.gov.vn http://www.moj.gov.vn http://www.mpi.gov.vn http://www.mof.gov.vn http://www.moit.gov.vn http://www.argoviet.gov.vn http://www.mt.gov.vn http://www.moc.gov.vn http://www.monre.gov.vn http://www.mic.gov.vn http://www.molisa.gov.vn http://www.cinet.gov.vn http://www.most.gov.vn http://www.moh.gov.vn http://www.moet.gov.vn http://www.mofa.gov.vn http://www.sbv.gov.vn http://www.gso.gov.vn http://www.tcvn.gov.vn http://www.vietnamtourism.com http://www.customs.gov.vn http://www.vr.org.vn
Related Documents
Ls Construction Cost Handbook 2012.pdf
May 2020 1
Construction Handbook
May 2020 4
Pre - Construction Cost
November 2019 6
Construction Cost Estimates
December 2019 4
Construction Cost Estimate
November 2019 15
Cost Audit Handbook
December 2019 7More Documents from "Platonic"
Brick Construction Technical Notes.pdf
May 2020 0
Ls Construction Cost Handbook 2012.pdf
May 2020 1
Lp Secctio Caesaria
October 2019 75
Si Book Chapter 3 Allfigs.pdf
November 2019 42
27022018121116_1_rkasallamah(1).pdf
April 2020 25