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Final Assignment in Cost Studies M2CPM9
- Module
- M2CPM9 (M2CPM9COSTSTUDIES)
- Institution
- Nottingham Trent University (NTU)
Construction of 30 New Two-Storey Detached Houses - Housing Development Project in NG8 Area of Nottingham
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Course: MSc. Construction Project ManagementModule: Cost Studies
Assignment No.: Final Assignment
Construction of 30 New Two-Storey Detached Houses - A
Housing Development Project in NG8 Area of Nottingham
June 2023
,Contents
1.0 Introduction................................................................................................................................................................... 2
1.1. What is Cost Estimation in Construction? ............................................................................................................ 2
2.0. The Assignment Task .................................................................................................................................................. 2
3.0 Task 1 - Preparation of an Order of Cost Estimate (OCE)...................................................................................... 2
4.0 Task 2 - Preparation of an Elemental Cost Plan (Cost Plan 1) ............................................................................ 10
5.0 Task 3 - Preparation of a Cost Appraisal for Two (2) Roofing Options............................................................... 14
6.0 Task 4 - Determination of Monthly Working Capital Requirements .................................................................... 16
7.0 References: .................................................................................................................................................................. 20
, 1.0 Introduction
1.1. What is Cost Estimation in Construction?
Cost Estimation in construction is a technique used to comprehensively calculate costs in order to
determine the total budget needs for the completion of a project. Like any other phase of a project,
preconstruction cost estimates directly affect the intended goals. In cost estimation each element
required on the project is considered. Among the many benefits of cost estimation, some of the
most significant are easy budget planning, resource allocation, effective risk management and
improved decision making. Estimating costs on a project is characterized by predicting quantity, cost
and price of the resources needed based on the project scope.
2.0. The Assignment Task
We have been appointed as Cost Managers for a housing development involving the construction of
thirty (30) new two-Storey detached houses, to be located at the NG8 area of Nottingham believed
to be in high demand. The site is being developed by a local developer and the budget for capital
costs is at £5.9 million.
There are four (4) main tasks that need to be done. These are;
1. Production of an Order of Cost Estimate (OCE) using the data provided.
2. Preparation of an elemental cost plan (Cost Plan 1) as a progression from the Order of Cost
Estimate (OCE).
3. Preparation of a cost appraisal indicating the comparative performance of the two (2) roofing
options over 100 years.
4. Determination of the working capital requirements from month to month.
3.0 Task 1 - Preparation of an Order of Cost Estimate (OCE)
An Order of Cost Estimate (OCE) is a document that helps establish a realistic cost limit for a
building project, its viability and makes the employer aware of any financial commitments prior to
them developing the most preferred option.
In this assignment, there is need to determine the principal area measurements and dimensions
based on the drawings provided. The method adopted is the floor area method. To determine the
principal area measurements, the following procedure is undertaken by calculating the following;
i. Gross Internal Floor Area (GIFA) on the ground floor.
ii. Gross Internal Floor Area (GIFA) on the first floor.
iii. Area of roof structure.
iv. Area covered by the roof.
v. Height of internal walls on the ground floor.
vi. Height of internal walls on the first floor.
vii. Calculating the Net Internal Area (NIA) on the ground floor.
viii. Calculating the Net Internal Area (NIA) on the first floor.
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