Social Housing - Development Cost Target Framework

SocialHousingDevelopmentCostFramework

In2009anindustryTaskGroupwasformedtodevelopacostingframeworkforthedevelopmentofsocialhousingprojects,ensuringthattheframeworkcouldbeappliedtoregionsandmunicipalitiesacrosstheprovince.

TheSocialHousingDevelopmentCostFrameworkestablishesatooltodetermineacceptableprojectcosts.Theframework,whichisbasedonadetailedreviewofmorethan20projects,isflexible,providingcostcontrolwhileallowingfordesignflexibility.Theframeworkgeneratesatargetcostforaprojectbasedontheprojectdataandallowssocialhousingproponentstoassesstheirprojectedprojectcostagainstthistarget.

BCHousingwilltaketheleadroleinensuringthattheframeworkisaccessibletothesectorandthattheinformationanddataiskeptcurrent.

CostingFramework

Theintentoftheframeworkistoactasaguidelinefornon-profithousingsocietiesandtheirteamsbyprovidingatargetprojectcostfortheirdevelopment,whichtheycanthencomparetotheiractualprojectcost.

Theframeworkisacomprehensivecostingmodel,incorporatinglineitemsforallprojectcostsassociatedwiththesocialhousingdevelopment.Thecostfactorsintheframeworkwereestablishedthroughextensiveresearchon20projects.Theprojectsstudiedwereselectedtorepresentabroadrangeofdevelopments.Projectselectionconsideredfactorssuchasprojectlocation,clientgroup,constructiontype,sizeandyearconstructed.ToarriveatthecostfactorsintheframeworktheTaskGroupusedtheaverageofallprojects,ratherthanthemedian.Thisensuredthatthecostingmodelcapturedthe‘outliers’aswellasthe‘norm’foreachofthelineitems.

Theapproachanddesignoftheframeworkhasseveralstrengthsasoutlinedbelow.

• Theframeworkisstructuredtoallowgroupstoeasilyseewhethertheyareoverorunderthetargetcostfortheirproject.Bydoingso,theframeworkremindsgroupsthatsocialhousingdevelopmentinvolvesacompetitiveprocessandencouragesthemtobecostconscious.

• Theframeworkprovidesatoolfornon-profitsocietiestoevaluatetheirownprojectproposal.Ifaprojectisnotviable,thegroupcanabandonorchangeitsplansquickly,ratherthanwastingtheirtimeonaprojectthatsimplywillnotgoahead.

• Theframeworkprovidesacostingpositionthatallowsnon-profithousingsocietiestomanagetheexpectationsofotherpartners,forexamplemunicipalitiesandhealthauthorities.Itwasalsonotedthatdevelopmentconsultantsmightusetheframeworktocalibratetheexpectationsofnewhousingsocietiesthathadneverbeeninvolvedinthedevelopmentofsocialhousing.

• Theframeworkhasbeendesignedtoallowcomparisonsofbuildingsizeandefficiencybetweenprojectsontwolevels.Theefficiencycalculatedonthebasebuildingareacanbeusedtocomparesocialhousingprojectstomarkethousingdevelopments.Theoverallbuildingefficiencycalculationcanbeusedtocomparesocialhousingprojectstooneanother.TheTaskGroupfeltthattheabilitytocompareprojectswouldhelpnon-profithousingsocieties,developmentconsultantsandarchitectsincontrollingtheefficiencyandsizeofthebuilding,whicharemajorcontributorstotheprojectcost.

• TheframeworkutilizesthecostclassificationsystemestablishedbyBCHousing’sJEDIdevelopmentcosttrackingprogram.JEDIhadbecomethesectorstandard,andmanydevelopmentconsultantsandnon-profithousingsocietieshavealreadydevelopedsystemsbasedontheJEDIclassifications.UsingJEDIclassificationsshouldsimplifydataanalysis,comparisonandtransfer.

Whileprovidingaguideline,theframeworkdoesnotpreventagroupfromproposingaprojectthatfallsoutsidethetargetparameters.TheTaskGroupsuggestedthatsocietiesthatwishtodothisshouldbepreparedtoprovideasoundbusinesscasefortheproject.

FrameworkDefinitions

Belowisaline-by-linelistofdefinitionsfortheSocialHousingDevelopmentCostFramework.Itshouldbenotedthatallfactorsinthecostframeworkwillbeadjustedperiodically,asrequired,inordertoensurethattheyremaincurrent.

NetUnitLivableArea:Iscalculatedbymeasuringaunitfromtheinsidefaceofthestudsontheinsidewallsoftheunit.VerticalductworkshouldbeexcludedfromtheNetUnitLivableAreaandincludedintheCirculationandServiceRoomscalculation.

NetUnitArea:Iscalculatedbymeasuringaunittothecenterlineofcorridorandpartywallsandtheoutsidefaceofexteriorwalls.Wheretheunitabutsthickerstructuralelements,thecenterlineoffsetdimensionatthepartywallshallapply.

AccessibleUnitAdjustment:Thisfactorprovidestheextraspacerequiredtocreateawheelchairaccessibleunit.

NetUnitSub-Total:ThismeasureisarrivedatbyaddingtheNetUnitAreas.

CirculationandServiceRooms:ThetargetareacalculationforcirculationandserviceroomsiscalculatedasapercentageoftheNetUnitSub-Total.Atthistimeitis18percentoftheNetUnitSub-Total.

TheactualareacalculationisarrivedatbysubtractingtheNetUnitSub-TotalandProgrammingAreafromGrossLivableArea(GLA:seedefinitionbelow).

BaseBuildingArea:ThismeasurementisarrivedatbysubtractingtheProgramAreafromtheGrossLivableArea.

ProgrammingArea:Theframeworkhasdefinedthreeprogrammingmodels.Foreachmodel,asquarefoot/unitcalculationhasbeendefined.Thiscalculationwasbasedonasurveyof20projects.

TheProgrammingAreaiscalculatedbymeasuringthespacetothecenterlineofcorridorandpartywallsandtheoutsidefaceofexteriorwalls.Wherethespaceabutsthickerstructuralelements,thecenterlineoffsetdimensionatthepartywallshallapply.ThismeasurealsoincludesthecirculationandservicespacerelatedtotheProgrammingArea.

• ModelA:Commonspaceprogramming:Theseprojectswouldprovide15sq.ft./unitofprogrammingspace.Generally,thiswillaccommodatealargemeetingroomandasmallprojectoffice.

• ModelB:Programspaceprogramming:Theseprojectsprovide40sq.ft./unitofprogrammingspace.Generally,thiswillaccommodatealargeflexiblespace,agalleykitchen,loungeareasandaprojectoffice.

• ModelC:Mealserviceprogramming:Theseprojectsprovide85sq.ft./unitofprogrammingspace.Tobeeligibleforthislevelofprogrammingspace,theprojectoperatingplanmustincludefullmealserviceforallresidents.Asaresult,theprogrammingspacewillaccommodateafullcommercialkitchenanddiningroom,aswellasotherprogrammingspaceandprogramstaffoffices.

GrossLivableArea(GLA):GLAisthesumofallfloorareaswithafinishedceilingabovegrademeasuredtotheoutsidefaceoftheexteriorwalls.Thisincludesutilityareaswithunfinishedsurfacesanditexcludescoveredparkingareas.Themeasurementistobetakenatthefloorlevel.

BaseSquareFootCost–TypeofConstruction:Themodelenvisionsthreeconstructiontypes:woodconstructionwithparkingongrade,woodconstructionwithundergroundparking,andconcreteconstructionwithundergroundparking.BCHousingwilltrackandpublishthecostpersq.ft.foreachoftheseconstructiontypes.Thesecostswillbeupdatedsemi-annually(everysixmonths)orasrequired.

Adjustments:Theframeworkhasdefinedfourcategoriesofcostadjustments.Thesecategoriesrecognizethatprojectsfundedbygovernmentmustincorporatehigherqualitystandards asaresultoflifecyclecostconsiderationsandthepotentialforongoingliability.TheadjustmentfactorsweredeterminedusingprojectdatacollectedbyBCHousing.Thesefactorswill bemonitoredsemi-annually,ormoreoften,andadjustedasrequired.ThesecalculationsaredeterminedbymultiplyingtheTotalBaseSquareFootCostbythepercentageadjustmentinthe secondcolumn.

• Designfactors:Thisadjustmentaccountsforthefactthatbuildinginfrastructure(e.g.plumbing)isintensifiedinsmall-unitprojects.Theframeworkassumesthataone-bedroomunitisneutral.Atwo-orthree-bedroomunitwouldreceiveanegativeadjustmentwhileastudiounitwouldreceiveapositiveadjustment.

• Durability:Thisadjustmentaccountsfortherequirementtoconsiderlifecyclecostingandincludemoredurableproductsandfinishesinthedevelopment.

• Sustainability:ThisadjustmentaccountsfortherequirementtoachieveLEEDGoldcertification.

• Geographiclocation:Thisadjustmentaccountsforthefactthatitgenerallycostsmoretobuildaprojectoutsideofmajorurbanareas.Theadjustmentwillbebasedondataanalyzedbyacostconsultant.Amapandadjustmentfactorsareincludedinthenotesappendedtothecostingframework.ThesefactorswillbereviewedannuallyandtheadjustmentfactorwillbeprovidedbyBCHousing.

TotalHardConstructionCost:IsthesumoftheBaseSquareFootCostandtheAdjustments.

AdditionalProjectCosts:Thesecostsincludeallcoststhatarenotassociatedwithhardconstruction.ThesecalculationsaredeterminedbymultiplyingtheTotalHardConstructionCostbytheadjustmentinthefirstcolumn.ThedefinitionsofthesecostsareinkeepingwiththeclassificationsusedbyBCHousing’sJEDIprogram.

• SoftCosts:TheseincludealllineitemsintheJEDIsubgroupstitledAppraisals/Studies,UtilityFees,DesignConsultants,Consultants,MiscellaneousSoftCosts,BorrowingCosts(ifapplicable),andBuildingStart-Up/Commissioning.

• NetMunicipalFees:ThisincludesthenetcostofalllineitemsintheJEDIsubgrouptitledMunicipalFees.

• Contingency:Thisincludesgeneral,designandconstructionriskcontingency.

• NetAcquisitionandServicingCost:ThisincludesthenetcostofthelineitemsintheJEDIsubgrouptitledAcquisitionandServicing.

GrossFloorArea:GrossFloorAreashouldbecalculatedbymeasuringfromtheoutsidefaceofexteriorwalls,disregardingcornices,pilasters,buttresses,etc.thatextendbeyondthewallface.Inadditiontogroundtotopstoreyinternalfloorspaces,GFAshouldincludebasements,attics,garages,undergroundparkinggarages,enclosedporchesandbalconies,penthousesandmechanicalequipmentfloors,lobbies,mezzanines(includingaccessstairsmeasuredonplan)andcorridors.Galleriesandsuspendedwalksincludingaccessstairsmeasuredonplan.

Nodeductionstotheareashallbemadefor:

1.Walls,partitions,etc.,

2.Openingsinfloorsforstairwells,escalators,ductsandotherfacilities,

3.Pits,trenches,depressionswhichareopenofhaveremovablecovers,and

4.Columns,piersorpilasters.

Notethatfurniture,fixturesandequipmentarenotincludedintheprojectbudget.

JEDI Classifications andCodes

ObjectAccount / Description / ObjectAccount / Description
CONSTRUCTION / 12450 / CONSULTANTS
12100 / APPRAISALS/STUDIES / 12455 / DevelopmentConsultant
12105 / Appraisal / 12456 / DevelopmentConsultantFees
12110 / MarketRentAppraisal / 12457 / DevelopmentConsultantDisb.
12115 / GSTAppraisal / 12458 / DevelopmentConsultantEx.Travel
12120 / Market/FeesStudy / 12460 / Geotechnical
12125 / NeedDemandAssessment / 12466 / Surveyor
12130 / TrafficStudy / 12470 / TopographicalSurveyor
12150 / ACQUISTIONSERVICING / 12475 / CostConsultant
12155 / LandValue / 12480 / EnvironmentalConsultant
12160 / OffsiteServiceCosts / 12485 / HazardousMaterialsConsultant
12165 / EnvironmentalRemediation / 12490 / Arborist
12170 / PropertyTransferTax / 12500 / ServiceDeliveryConsultant
12171 / PPT–Purchase / 12505 / FireSafetyPlan
12172 / PPT–Lease / 12510 / MaintenanceRenewal
12175 / Demolition / 12525 / BCHousingInspector
12180 / MortgageBuy-Out / 12516 / BCHInspectorFees
12200 / MUNICIPALFEES / 12517 / BCHInspectorDisb.
12201 / MunicipalFees / 12520 / DirectDelivery
12205 / BuildingPermit / 12525 / CommunityConsultant
12210 / DevelopmentCostCharge / 12550 / MISCELLANEOUSSOFTCOSTS
12215 / RegionalDevelopmentCost / 12555 / PropertyTaxesPre-IAD
12220 / OCP/RezoningApplication / 12560 / UtilitiesPre-IAD
12225 / SubdivisionApplication / 12565 / CourseofConstructionInsurance
12230 / MunicipalConnectionFee / 12570 / ProfessionalE&OInsurance
12235 / BuildingGrade / 12575 / SocietyOrganizationCosts
12240 / DevelopmentPermit / 12585 / SocietyLegalCosts
12250 / UTILITYFEES / 12590 / BCHProgramSign
12252 / GasConnectionFees / 12595 / BCHRecoverableCosts
12255 / HydroConnectionFees / 12600 / MaintenanceCosts
12260 / CableConnectionFees / 12605 / TitleFees
12265 / TelephoneConnectionFees / 12610 / SecurityPre-Construction
12350 / DESIGNCONSULTANTS / 12615 / GSTSelf-Supply
12355 / ArchitectContract / 12620 / GSTNonSelf-Supply
12356 / ArchitectContractSub-Consultants / 12650 / BORROWINGCOSTS
12357 / ArchitectContractFees / 12655 / InterestPre-IAD
12358 / ArchitectContractDisb. / 12660 / LoanAdministrationFee
12360 / Structural / 12665 / MortgageInsuranceFee
12365 / Electrical / 12670 / LoanFee
12370 / Mechanical / 12700 / CONSTRUCTION
12375 / Landscape / 12705 / ConstructionContract1
12380 / BuildingEnvelope / 12706 / ConstructionContractManager
12385 / CodeConsultant / 12707 / ProjectManager
12390 / CivilConsultant / 12708 / ConstructionManagerDisb.
12395 / CertifiedProfessional / 12709 / Support/ServiceDelivery
12400 / SecurityConsultant / 12710 / ConstructionCosts
12405 / Acoustic / 12720 / ConstructionContract2
12410 / Kitchen / 12730 / ConstructionContract3
12420 / LEEDConsultant / 12740 / ConstructionContract4
12750 / Landscaping / 12900 / DEDUCTIONS
12755 / UnitAppliances / 12910 / LandEquity
12760 / CommonLaundry/Kitchen / 12920 / Equity
12765 / CommercialKitchenAppliances / 12921 / SocietyEquityHeldbyBCH
127790 / On-SiteSecurity / 12992 / SocietyEquity
12775 / BuildingWarranty / 12940 / Grants
12800 / BUILDINGSTART-UP/COMMISSIONING / 12945 / BCHousingGrants
12805 / ProjectCommissioning / 12970 / HOLDBACKS
12810 / VacancyLoss / 12972 / Builder’sLienHoldback1
12815 / Marketing / 12973 / Builder’sLienHoldback2
12820 / CommonDining/Furnishing / 12974 / Builder’sLienHoldback3
12825 / OfficeEquipment / 12975 / Builder’sLienHoldback4
12830 / MaintenanceEquipment / 12976 / DeficiencyHoldback1
12835 / SupportServicesEquipment/Supplies / 12977 / DeficiencyHoldback2
12850 / CONTINGENCIES / 12978 / DeficiencyHoldback3
12855 / ProjectContingency / 12979 / DeficiencyHoldback4
12859 / MiscellaneousContingency / 1289 / ReductionofLoanAmount
TotalCapitalBudget
TotalDeductions
NetCapitalBudget