EC&Sus - Module 7 - Cost Building 2019-2020
EC&Sus - Module 7 - Cost Building 2019-2020
EC&Sus - Module 7 - Cost Building 2019-2020
Concept of ratios
Cost calculation tool for estimation of the investment cost of buildings
Investment cost versus life cycle cost
• Learning goal: Based on this module you should gain insight in the
influence of design decisions on the investment cost of a building. You
should be able to calculate the investment cost. Finally, you should
gain insight in the parameters that influence the life cycle cost of a
building.
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• Used by:
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Functional
building-
elements
Neighbourhood
Functional
building- Building
elements
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External walls
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Hierarchical subdivision:
macro-elements elements
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Hierarchical subdivision:
macro-elements elements (example roof)
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• sub-element
• Lowest level: each work section is summarised in a table whereof each row
represents a material/process
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Concept of ratios
etc
Quality Layout
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Concept of ratios
Floorarea
Floor area==55xx10
10xx33x=5150 m² m²
= 750
Wallarea
Wall area==55xx10
10xx22x=5100 m²x 10 x 2 = 700 m²
+ 10
=>Ratio
=> Ratiowall
wall==700/750
100/150==0,93
0,67
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Concept of ratios
price1 Price1 x r1
price2 Price2 x r1
price3 Price3 x r1
price4 Price4 x r1
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Concept of ratios
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Concept of ratios
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Aim:
• Easy comparison of the various case studies
• Graphical representation for easy interpretation/comparison
How:
• Translate specific case to a box building with the same ratio’s for:
• Roof
• Floor
• External walls
• Internal walls
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5m
10m 10m
20m
10m 25m
Grid: 3 x 3 m
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Calculations
building-
IN T ER IM R E SU LT S plot fra gme nt
building
Equivalent Width 10,0 m 12,0 m width = 140,0 m
Equivalent Depth 6,0 m 20,0 m depth = 50,0 m
Eq. Width/Depth -ratio 1,67 Area= 240,0 m² Total fragment area= 0,70 ha
ESRS 3,2 m built-up= 1 200 m² Total floor area= 2 400 m²
ESRA 10,0 m² Circulation/tot.area= 31%
street // W = 1 200 m² 120 m Residential/tot.area= 69%
street // D = 1 000 m² 50 m Builtup/residential= 25%
resid.area = 4 800 m² Circulation density = 243 m/ha
total area = 7 000 m² Net population density = 343inh/ha
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w
A = floor area of ONE floor (m²)
p = perimeter of ONE floor (m)
w? d?
Equation 1:
Equation 2: 2
1) Eq 2 =>
2) In eq1 => => => 0
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AND
Internal walls
Input:
i = running meter (length) of internal wall of ONE floor (m)
Output:
• ESRS = equivalent length of the side of the square room (m)
• ESRA = equivalent area of 1 square room (m²)
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Internal walls
Calculation: ESRA
Number of square rooms = A/ESRA
4 2
²
4 2
4 ESRS
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Inner wall length = 30 m Inner wall length = 25 m Inner wall length = 150 m
Grid: 3 x 3 m
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8/4 = 2
A
1
B 4/1 =4
C 10/4 = 2,5
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B
4/1 = 4 0/4 =0
8/4 = 2 4/4 = 1
E
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B
C
side x 1,5
Same surface, more
surface x (1,5 x 1,5) = 2,25
rectangular => +50%
Internal wall X 1/2
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B C
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A D
E F F
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Excel file developed which graphically represents the calculated values of:
- Equivalent box building
- Ratio floor and roof
- Ratio external walls
- Ratio internal walls
- Population density
- Circulation density
From these:
• A list of ratios is deducted for the various building elements
• These are combined with prices/unit element (see next slide)
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Assumptions on cost data (equal for all cases for easy comparison)
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Assignment 4 – part A
Calculate the values and draw these manually on the file “3GrafRepr”
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Being able to
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Assignment 4 – part A
Save as “LL_building_XXX_City_YourName“
Load the (manual) drawings & excel file in discussion board
Fill in your results in: “Cost Building 2019-2020.xlsx”
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Investment cost
Maintenance,
replacements
Insurance,
taxes
EoL
Energy
[Vrijders, 2015]
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Micro-economic perspective
Macro-economic perspective
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Macro-economic examples
1.Obligation to construct energy efficient and environmentally
friendly cars :
→ less energy consumption → less income for the government →
compensation by increasing taxes elsewhere
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GENERAL:
• Base for decisions or evaluation process for a building or parts of it
during the whole life cycle
• Absolute: planning, budget control, contracts
• Relative: comparison of options, design support, alternative
technologies,…
Examples:
• Energy efficient building/renovation: investment vs energy(cost)savings
• Cost optimal building
• Choice of finishing materials
• Dynamic and adaptable design
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Several scenarios:
- No intervention: further use without any adaptations
- Energetic renovation
- In-depth renovation
- Demolition and new-built – solid (bricks)
- Demolition and new-built – timber frame
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In-depth
renovation
Demolition
and new-
built (solid)
LCC (euro)
Energetic
renovation
Demolition
and new-
built
(timber)
No
intervention
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[Trigaux, D., De Troyer, F., Allacker, K., Paduart, A., Debacker, W., De Temmerman, N. (2013). LCC and LCA of dynamic
construction in the context of social housing. SB13 Graz – Sustainable Buildings, Construction Products & Technologies – Full
papers: 437-447, Graz, Austria, 25-28 September 2013]
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This standard describes the methods and the rules for calculating the cash flows over the
life cycle of buildings, with an emphasis on the field of life cycle costing. Principles
developed in ISO 15686-5 are included, but have been adapted for sustainability
assessment in the European context.
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[Habert, 2014]
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With:
LF = life cycle financial cost (€)
IF = initial financial cost (€)
SPV(PF0) = sum of the present values of the periodic financial costs (€)
SPV(EOL F0) = sum of the present values of the EOL costs (€)
R0 = residual financial value (+) or costs (-) at the end of the life span of the building (€)
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After selecting an appropriate discount rate ‘d’, the present value can be calculated as:
The above formula assumes that ‘d’ is constant over the considered period. It should be interpreted as
an average rate over the considered period.
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‘the factor reflecting the time value of money that is used to convert cash flows occurring at
different times to a common time’
Discounting means costs and savings in future are less important than these at present
If d = 0%, future costs are equally important as current costs
the higher the discount rate, the more importance is given to the near-present and the
less importance is given to what happens in the distant future
often assumed to be equal to the interest rate for bank loans, which is higher than the
interest rate for investments. By doing so, the present value of future revenues (and
expenditures) is underestimated and less risk is taken.
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The value of money inflates or deflates over time, reflected by ‘it’ during year t.
The cost in year t (pt) of the cost p0 now (year 0); can then be determined as:
In consequence, the purchasing power of currency changes over time. The purchasing
power of Xt is equal to:
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‘i’ represents the average yearly inflation rate over t periods and ‘d’ the nominal yearly discount rate
over t periods. To simplify the formula a real discount rate, d’, can be calculated over the same period.
The inflation rate is thus included in this real discount rate. The advantage of the use of a real discount
rate is the fact that one does not need to estimate the inflation rate explicitly
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The growth rate can be either positive or negative. The growth rate of prices can fluctuate and therefore
change yearly. In the above formula ‘g’ represents the annual average growth rate over a period up to
year t. If a constant yearly growth rate ‘g’ is assumed, the price evolution is exponential.
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- Yearly cost:
- Periodic cost:
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Discount rate?
Rapid reduction of the present value of future costs, even for relatively low
discount rates
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Discount rate?
The discount rate to be used depends on the context and little agreement is noticed among economists
what discount rates to use. The discount rate however influences the results to a great extent. The
discount rate in micro-economy analysis should reflect the private owner’s or building owner’s choice to
invest money in dwellings
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Growth rate?
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Growth rate?
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1/01/1974
1/01/1978
1/01/1982
1/01/1986
1/01/1990
1/01/1994
1/01/1998
1/01/2002
1/01/2006
1/01/2010
production
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1,000 € / liter
0,800
1970-2011: 3,48% /jaar
0,600
0,400
0,200
0,000
1/01/1970
1/01/1974
1/01/1978
1/01/1982
1/01/1986
1/01/1990
1/01/1994
1/01/1998
1/01/2002
1/01/2006
1/01/2010
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1,000 € / liter
0,400
0,200
0,000
1/01/1970
1/01/1974
1/01/1978
1/01/1982
1/01/1986
1/01/1990
1/01/1994
1/01/1998
1/01/2002
1/01/2006
1/01/2010
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€ / liter
1,000
1970-2011: 3,48% /jaar
0,400
0,200
0,000
1/01/1970
1/01/1974
1/01/1978
1/01/1982
1/01/1986
1/01/1990
1/01/1994
1/01/1998
1/01/2002
1/01/2006
1/01/2010
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€ / liter
1,000
1970-2011: 3,48% /jaar
'79-'82: 28,94% /jaar
0,800
jan 99-juli 08: 11,53% /jaar
jan 09- mrt 11: 27,01% /jaar
0,600
0,400
0,200
0,000
1/01/1970
1/01/1974
1/01/1978
1/01/1982
1/01/1986
1/01/1990
1/01/1994
1/01/1998
1/01/2002
1/01/2006
1/01/2010
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Growth rate?
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Growth rate?
Economic parameters – growth rate material and labour (nominal values):
ABEX: 2,5% (reflecting a systematic faster growth than the general inflation due to the specificity of the
sector)
S-index (labour): 3%
I-index (material): 2% 3000.00 ABEX
2500.00 CONS
I
2000.00
Smax
1500.00
ABEX 2.5% ;
R²=0.98
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Conclusions
1. Building layout influences the ratios of the building elements to an
important extent
2. The investment and life cycle cost depend on the amount of elements
and unit cost per building element
3. Concept of ratios as a strong instrument to compare buildings/design
alternatives
4. Investment cost is only a fraction of the life cycle cost (due to the
relatively long life span of buildings)
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Thank you
[email protected]
Division of Architectural Engineering
Department of Architecture - Faculty of Engineering Science
KU Leuven
Kasteelpark Arenberg 1 box 2431 | B-3OO1 Leuven
http://architectuur.kuleuven.be/architectural-engineering