- Financial Advantages:Case Study
32 - Unit Apartment Building ( 4 stories )
You may be wondering what the financial advantages of building modularly are versus conventionally: below we compare building a 32unit apartment building with either method.*
Financial Advantages: Modular Construction Case Study
Details
Build Time
(compressed vs. conventional building schedules)
Construction Cost
Financing
Financing
(assuming 1000 s.f. units, construction cost of $140 / s.f. & 8% finance rates)
Rental Income
(fast track to occupancy & revenue generation)
Overhead Savings
Resource Realignment
Project Simplicity
FACTORY - BUILT
Construction
6 months ( site servicing & plant manufacturing performed concurrently) Weather not a factor.
Savings = 32,000 s.f. X $140 / s.f. @ 8% annual construction finance rate = $179,200 over 6 months.
6 months @ $1000 / unit / month X 32 units = $192,000 in extra rental income.
5% - 10% over 6 months
6 months quicker - 2X project capability
Dealing with a single source = Simplicity
COVENTIONAL
Construction
12 months (site servicing followed by construction) or more depending on weather delays.
$179,200 in extra construction financing costs over 6 months of construction time.
$192,000 lost in rental income.
NONE
6 months slower - ½ X project capability.
Dealings with multiple sources and trades = Headaches
* Note: Above information is provided as an example and assumptions are made; the case study is demonstrative of real-world advantages of modular construction. Case study can be applied to other types of buildings such as hotels and residential buildings.
