LAND OWNERS WITH MINIMUM 1/8TH ACRE LAND WANTED FOR JOINT VENTURE IN DEVELOPMENT OF HOUSES FOR SALE.
LAND SIZE MINIMUM 1/8TH ACRE. MAXIMUM DISTANCE FROM TARMAC ROAD-2KM.
www.a4architect.com is seeking to partner with land owners who have a minimum land size of 1/8th acre and the land is situated a maximum of 2 km from a tarmac road.
Development of houses for sale require 3 key ingredients to succeed:
1. Land
2. Architectural and Construction project management services
3. Financing
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| From DIAMOND HOUSE V 2.5 |
The land owner will provide the Land,www.a4architect.com will offer architectural and construction project management services and selected leading Banks in Kenya will offer finance .
With these key ingredients in place, the profit accrued from the sale of the houses will be divided in a prorata basis based on the value of the contribution vis a vis the total project cost after the land owner is refunded back the land cost value.
INCOME.
The whole procedure from design to construction takes an average of 3 months to complete, with an income of KES 1m for the 3 months. This translates to a monthly income of KES 330,000.
DIAMOND HOUSE-PHASE 1- CONSTRUCTION COST BREAKDOWN.
PHASE 1-49M2. ONE BEDROOMED UNIT.
PHASE 1 IS DIVIDED FURTHER INTO 13 SUB-PHASES.
HOUSE OWNERS CAN CHOOSE TO IMPLEMENT THE 13 SUB-PHASES DEPENDING ON THEIR FINANCIAL ABILITY.
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DIAMOND HOUSE BY WWW.A4ARCHITECT.COM |
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APPROXIMATE COSTS PER SUB-PHASE |
AMMOUNT -LOW COST FINISHES |
AMMOUNT -MIDDLE COST FINISHES |
AMMOUNT -HIGH COST FINISHES |
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1 |
Substructures[Foundations] | 216,766.44 | 324,198.93 | 431,631.42 |
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2 |
Reinforced Concrete Frame[Ring beam] | 79,252.80 | 118,531.60 | 157,810.40 |
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3 |
Superstructure walling-masonry stone | 99,181.82 | 148,337.73 | 197,493.63 |
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4 |
Roof structure, covering, finishes and rainwater goods-GCI roofing sheets | 86,453.04 | 129,300.38 | 172,147.72 |
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5 |
Windows-louvre | 44,505.60 | 66,563.20 | 88,620.80 |
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6 |
Doors | 64,642.56 | 96,680.32 | 128,718.08 |
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7 |
External finishes | 29,986.56 | 44,848.32 | 59,710.08 |
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8 |
Floor Finishes-cement screed | 12,289.20 | 18,379.90 | 24,470.60 |
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9 |
Wall Finishes-plaster on paint | 42,408.00 | 63,426.00 | 84,444.00 |
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10 |
Ceiling Finishes | 50,789.28 | 75,961.16 | 101,133.04 |
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11 |
Sanitary Fittings | 34,108.80 | 51,013.60 | 67,918.40 |
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12 |
project management | 34,627.50 | 51,789.38 | 68,951.25 |
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13 |
Septic tank, Electrical Wiring,Plumbing | 165,300.00 | 247,225.00 | 329,150.00 |
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Sub Total | 960,311.60 | 1,436,255.51 | 1,912,199.42 |
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CONSTRUCTION SUPERVSION | 24,007.79 | 35,906.39 | 47,804.99 |
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Total Estimate | 984,319.39 | 1,472,161.90 | 1,960,004.41 |
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EXAMPLE 1.
LAND OWNER DEVELOPING 2 HOUSES ON A 1/8TH ACRE FOR SALE.
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| From DIAMOND HOUSE V 2.5 |
Assumption: Land cost 1/8th acre-KES 1m.
Construction cost for 2 one-bed roomed phase 1 diamond house type houses within 1/8th acre –KES 2.45m per unit.
SALE PRICE
The average cost of a 100m2 3 bed roomed house in Nairobi Outskirts is KES 5m.
The a4architect.com Diamond House phase 1-one bed roomed unit is 49m2.
This translates to a cost of 2.75m per unit to achieve the desirable profit margin.
There will be 2 units in the 1/8th acre plot. This totals to KES 5.5m for both houses.
In this example, it’s assumed that the land owner borrows all money for construction hence pays back the bank for the full amount. The amount borrowed from the bank can be reduced proportionately if the land owner can add on to the costs through personal savings.
This will result in a higher profit.
| Cost Item |
Kshs |
% |
| Land |
1,000,000.00 |
22.4417 |
| Preliminary |
60,000.00 |
1.3465 |
| Construction |
2,450,000.00 |
54.982 |
| External Works |
24,500.00 |
0.54982 |
| Contingency |
49,000.00 |
1.09964 |
| Professional fees |
196,000.00 |
4.39856 |
| Project Management fees |
49,000.00 |
1.09964 |
| Legal fees |
24,500.00 |
0.54982 |
| Marketing |
137,500.00 |
3.08573 |
| Financial Charges[19% of construction cost] |
465,500.00 |
10.4466 |
| Total |
4,456,000.00 |
100 |
| Financing Plan |
Kshs |
% |
| Developer+a4arcitect.com |
1,252,500.00 |
28.1082 |
| Equity Provider |
0.00 |
0 |
| Debt Finance |
2,653,500.00 |
59.5489 |
| Presales |
550,000.00 |
12.3429 |
| Total |
4,456,000.00 |
100 |
| PROFIT | ||
| TOTAL SALES FOR 2 UNITS |
5,500,000.00 |
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| TOTAL EXPENDITURE |
4,456,000.00 |
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| NET PROFIT |
1,044,000.00 |
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| NET TAKE-HOME AMMOUNT-profit +land cost |
2,044,000.00 |
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| PROFIT MARGIN |
23.42908438 |
EXAMPLE 2.
LAND OWNER DEVELOPING 2 HOUSES ON A 1/8TH ACRE LAND TO OCCUPY OR RENT ONE UNIT AND SELL THE OTHER.
A land owner owning 1/8th acre plot of land would also want to construct 2 units and live in one then sell off the other.
In such a case, the land owner will be required to top up an additional KES 637,000.
This way, he will be the proud owner of a one-bed roomed house at a cost of KES 637,000.
| OWNER SELLING ONLY ONE HOUSE AND LIVING IN THE OTHER | ||
| Cost Item |
Kshs |
% |
| Land |
1,000,000.00 |
22.7933 |
| Preliminary |
60,000.00 |
1.3676 |
| Construction |
2,450,000.00 |
55.8436 |
| External Works |
24,500.00 |
0.55844 |
| Contingency |
49,000.00 |
1.11687 |
| Professional fees |
196,000.00 |
4.46749 |
| Project Management fees |
49,000.00 |
1.11687 |
| Legal fees |
24,500.00 |
0.55844 |
| Marketing |
68,750.00 |
1.56704 |
| Financial Charges[19% of construction cost] |
465,500.00 |
10.6103 |
| Total |
4,387,250.00 |
100 |
| Financing Plan |
Kshs |
% |
| Developer+a4arcitect.com |
1,218,125.00 |
27.7651 |
| Equity Provider |
0.00 |
0 |
| Debt Finance |
3,031,625.00 |
69.1008 |
| Presales |
137,500.00 |
3.13408 |
| Total |
4,387,250.00 |
100 |
| PROFIT | ||
| TOTAL SALES FOR 1 UNIT |
2,750,000.00 |
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| TOTAL EXPENDITURE |
4,387,250.00 |
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| NET PROFIT |
-1,637,250.00 |
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| NET ADDITIONAL AMMOUNT-profit +land cost |
-637,250.00 |
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| PROFIT MARGIN | ||
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| From DIAMOND HOUSE V 2.5 |
CONCLUSION
The project can be implemented in phases and each phase can extend from the minimum size of 1/8th acre plot to hundreds of acres depending on the availability of land.
Architect Francis Gichuhi Kamau
info@a4architect.com
+254721410684
www.a4architect.com
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