All successful housing development projects, on time and within budget, start out with a structured, defined and detailed business plan.
This business plan is developed through a number of study phases conducted to identify and examine the potential risks and rewards associated with executing the project and produce a definitive budget and schedule.
The study phases normally follow the route of conceptual study, feasibility study and defined or bankable study, however on some projects this can be shortened but it is seldom less than two study phases.
How the BSM Group Consultancy Service Can Help You
The BSM Group Consultancy Service is available to take a housing development concept through the necessary study phases and provide the information required to plan the best way forward to satisfy all stakeholders.
Typically the first step takes the form of a conceptual study where the information at hand may be no more than an identified piece of land and the intention to use this to satisfy a need for housing. This phase develops in broad terms the intended scope and required outcome of the project by producing conceptual township layouts, obtaining preliminary authority approval, confirming the marketability of the development, identifying service providers and preparing the preliminary project budget.
The time scale, work scope and cost of the following study phases is also prepared ensuring that correctly informed decisions on the project’s future can be made.
Positive results from the conceptual study can be sufficient that the decision to move directly to the definitive study phase can be made with the resultant saving in time and cost.
The second phase however would normally be the execution of a feasibility study which reviews the results from the conceptual study and takes this forward in much more detail. This detail would typically consist of:
- Topographical and geotechnical surveys.
- Confirmation of the preliminary township layout.
- The production of house plans suited to the market demands.
- The positioning of the various houses within the township layout.
- The detail of the road network and link to the existing road services.
- The reticulation of water, sewage and power services.
- The allocation of space for social services facilities.
- The location of resident support facilities (recreational, religious etc)
- Firm up approvals from the relevant authorities.
- Negotiate terms and conditions with the service providers.
- Develop the marketing strategies for the housing units.
- Firm up the selling price for the various housing units.
From this information the construction schedule is developed to give the time frame to the first housing unit available and through to the close out of the project. The project budget and cash flow are now developed to an accuracy of within 20%.
At this point many projects proceed to execution as the result of the feasibility study providing the confidence to make this decision.
Following this decision, and the requirement for competitive bids, tender documents are prepared for issue to selected construction contractors. The evaluation of tenders and recommendation of the most suitable contractor is a service also provided by the BSM Group.
For various reasons, such as the raising of finance, it is necessary to carry out a definite study, or bankable study as it is sometimes called, which entails the firming up of the technical, schedule and budget information to provide a cost estimate to an accuracy of 10%.
The fundamental of all study work is to identify the potential risks to the project and have them eliminated or have mitigation plans developed and documented. Likewise potential rewards are similarly treated but to maximize their potential.