Wednesday, 30 November 2016

Opening Up Large Virgin Sites With Minimal Budget -Engr. Osaz' ENOBAKHARE

Owning a mega estate is a tall dream most developers are aspiring towards, but the processes of getting funding for such ventures could be very stressful and frustrating. Most times developers are only able to secure just a fraction of the total funds they actually need to execute a project as funds providers wait to see how the initial disbursement would be utilized before releasing the next set of funds. If they discover that the initial flow was not spent effectively, it may be extremely difficult to secure the next cash flow. Therefore it becomes imperative to adopt cost-effective approach in the execution of projects.

Site preparation is usually the first program of work on the construction site. Spending so much money preparing the site when there is a lot more work to be done could eventually lead to abandoning of the project; hence estate developers together with their contractors should always adopt best and cost-effective approaches to project delivery before moving to site. 

Let’s consider a scenario where there is 100 acres of wet land (swampy) to be cleared, prepared and subsequently developed into a housing estate. From experience, it takes a swampdozer about 8 hours (equivalent to a day work) to neatly clear an acre of land. By the way, an acre of land is about 6 standard plots. 

In some cases, it takes even more time depending on how thick the vegetation is. A plant company would normally charge some 100,000 NGN per 8-hr to perform such task. Hence it may cost about 10,000,000 NGN to eventually open up the entire land area. This estimated cost may not include the cost of supervision and clearing the entire site may take up to 100 days (not including down-times) if only one swampdozer is used.

A Swampbuggy
The cost-effective approach in such situation may therefore be to acquire a fairly-used swampdozer (serviced) which go for about 4 Million NGN depending on its size. 

Employ a skilled operator with three able assistants on a casual arrangement to man the machine at a combined salary package of about 250,000 NGN per month. 

Assign a mechanic to do routine or emergency repairs on the machine during work. Repairs may gulp only about 500,000 NGN throughout the duration of the work. 

A Swampdozer
Then get a diesel supplier to supply products (AGO and machine/engine oil) to the site as required and at good prices. Being under your direct control and by introducing the right incentives, you can compel the operator and his assistants to work well beyond the 8-hour mark to save cost and time. 

A Swampdozer at work
In the end, with only about 7 Million NGN you can successfully clear up the entire land area in less than 3 months, this way you would have saved up to 3 Million NGN which could be put into a more effective use and you would have gained new assets in plant and skilled labour which could also be deployed for similar tasks elsewhere. 

In fact more money can be saved if site clearance activities on wet lands were performed during the dry season as the plant would experience less fatigue and do more work in lesser time.

Although this particular idea may be cost-effective for large land areas up to 50 acres even in the short term, the same cannot be said for smaller land sizes except perhaps in the longer term. 

But by and large, the principles are useful everywhere. Working with the right contractors or project team can help developers minimize project costs, achieve more in less time and maximize profit. The ability to identify and implement cost-effective yet suitable approaches in estate development from start to finish is something any developer who intends to grow and expand quickly should take very seriously.     

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