Business Proposal in Residential Real Estate Project

Mahabir Realtors Pvt Ltd. (MRPL)

Mahabir Realtors Pvt Ltd

Head Office: Mahabir Bhawan, Adarsh Nagar, Dewal road, Jorhat-1

Company Structure

Real Estate VS Other Financial Product Offering

Product

Safety

Liquidity

Capital Appreciation

Risk

Tax Benefit (80 C)

N/A

Tax Benefit (80 D)

N/A

Brokerage

Equity

Low

High

High

High

Low

Commodity

Moderate

High

Moderate

High

N/A

N/A

Low

Mutual Fund

Moderate

High

Moderate

Moderate

ELSS

N/A

Low

Fixed Deposit

Moderate

Low

Low

Low

N/A

N/A

Low

Post office

High

Low

Low

Low

Yes

N/A

Low

Insurance

Moderate

Low

Low

Moderate

Yes

N/A

High

Real Estate

High

Moderate

High

Low

Yes

Yes

High

LAND
The land area is 2 Bigha & 17 Locha (30248 sq ft.). The Permit of construction of floors as per Jorhat Development Authority in Lichubari Area is Ground + 4 floors including Terrace. Wastage Land For Parking: 6618 Sq.ft Area of construction Land: 23630 Sq.ft Waste Constructed Area : 3630 Sq.ft. Constructed Area available for Sale: 20000 Sq ft per floor (20000*4= 80000 sq ft.).

Aerial View Of Site

Cost Structure
All the different types of cost for Land, Construction, Finishing, Marketing, Miscellaneous expenses etc has been taken as cost of construction per Sq.ft. .

Cost of Project
Foundation Cost of 23630 Sq Ft Area per Sq Ft Rs 900 (23630*900) Ground Floor Cost of 23630 Sq Ft Area per Sq Ft Rs 800 (23630*800) 1st Floor Cost of 23630 Sq Ft Area per Sq Ft Rs 700 (23630*700) 2nd Floor Cost of 23630 Sq Ft Area per Sq Ft Rs 600 (23630*600) 3rd Floor Cost of 23630 Sq Ft Area per Sq Ft Rs 500 (23630*500) 4th Floor (Terrace) Cost of 23630 Sq Ft Area per Sq Ft Rs 50 (23630*50) Total Cost for the Project Rs. 21267000 Rs. 18904000 Rs. 16541000 Rs. 14178000 Rs. 11815000 Rs. 1181500 Rs. 93886500

Therefore, cost of Constructed area Available for Sale is:

Total cost for the Project/ Constructed area Available for Sale 93886500/80000 = Rs. 1174/- per sq.ft.

Revenue Structure

REVENUE LAYOUT
Each Floor will consist of 10 flats with an area of 2000 sq.ft. each. Total no. of Flats will be 40. Each Flat will consist of 3 bedrrom with attached bathrooms, Living Room, Kitchen, Store Room, Balcony, Puja room, Dinning Room, Servant Room. Car Parking Space Rs. 100000 will be mandatory. Preferred Location Charges (PLC) will be Rs. 150 for Ground Floor, Rs. 125 for 1st floor, Rs. 100 for 2nd & Rs. 75 for 3rd floor.

Revenue Model
First 10 Flats will be sold @ Rs.1300 (10*1300*2000) Second 10 Flats will be sold @ Rs.1400 (10*1400*2000) Rs. 26000000 Rs. 28000000

Third 10 Flats will be sold @ Rs.1500 (10*1500*2000)

Last 10 Flats will be sold @ Rs.1650 (10*1650*2000) Car parking space Charges from 40 Flats (100000*40) PLC from Ground floor @ Rs. 150 (150*20000) PLC from 1st Floor @ Rs. 125 (125*20000) PLC from 2nd Floor @ Rs 100 (100*20000) PLC from 3rd Floor @ Rs. 75 (75*20000) Total Revenue Generated

Rs. 30000000
Rs. 33000000 Rs. 4000000 Rs. 3000000 Rs. 2500000 Rs. 2000000 Rs. 1500000 Rs. 130000000

Cost of Capital

DIFFERENT SOURCES OF FUND

Promoters Capital 5% of the total cost of project 14% p.a

Bank Loan

95% of the total 14% p.a cost of project

Pay Back Period & EMI

No sales took place for the 1st year after initializing of the project. First 10 Flats sold out before 18 months of the project initializing. Second 10 Flats sold out after 24 months of the project initializing. Third 10 Flats sold out after 27 months months of the project initializing. Last 10 Flats sold out after 30 months of the project initializing.

Repayment Schedule @ 14% p.a

PERIOD 0-18 months 18-24 months 24-27 months 27-30 moths Loan (Opening) Interest Repayment Balance

Principal
6283835 21867813 27699280 38035572

Interest
19716165 87602665 6132187 2300720 1331245 65734852 38035572 NIL 29480317

93886500 19716165 87602665 65734852 38035572 6132187 2300720 1331245

Therefore, Total amount of Interest paid

Insurance

During the stage of Construction

Workmen's Compensation Insurance

Niwas Yojana Policy

Workmen's Compensation Insurance

The employers legal liability under the W.C.Act to pay compensation to employees not covered under E.S.I.Act for bodily injury or disease sustained / contracted out of and in the course of employment is covered by this policy.

Niwas Yojana Policy

The Policy comprises of two sections : Section I is intended to cover building and owners permanent fixture and fittings. Section II is Death/Permanent Total Disablement of Loanee. The Policy will cover the risk of financiers and the loanee/owner of the premises Mentioned in the schedule of the policy. Premises under construction will also be covered. Policy will cover building of Class A construction only. The Financial Institution/employer can take group policy. Group discount will be Allowed only for PA Section (Sec II).

After the completion of Construction

Fire Insurance Policy

Home Insurance Policy

Fire Insurance Policy

With more and more people opting for a luxurious lifestyle, as a result becoming gadget freaks, the risk of facing a crisis situation i.e. fire accidents have increased considerably. In such circumstances, the best bet would be to get your house and commodities secured and insured. One such policy is the home fire insurance policy, also called Standard Fire and Special Perils Policy, the bulwark against such potential perils. It offers protection against the risk of loss or damage due to fire or special perils. The policy pays for the actual cost of repairs, replacement or setting up of the item lost or damaged.

Home Insurance Policy

The home insurance plan is intended to protect the homeowners against accidental damage of the house. The damage that can get covered under this policy are a variety of disasters such as storm, theft, vandalism and related hazards.

Risk Management

Potential Risk

Curable Act

Cash shortfall

Maintain sufficient liquid or cash reserves to cover costs and debt service for a period of time, Purchased property is in desirable locations to stand out from competition, control cost structure, Future market of the City is moving slowly & steadily towards the area of proposed of construction.

Economic downturn

Fire, flood, personal injury

Insurance policy on the property

The Market

Customers
The Targeted customers will be all the employees of Assam Agriculture University, Jorhat Medical College & Hospital, Proposed NIFT, Cinnamara, Jorhat, Tocklai Tea Research Centre, ONGC & all the other customers who want to buy the property for the investment purpose due to the economic rate per sq.ft.

Why to choose????
Due to economic rate per sq.ft. Preferable Location Earthquake resistant Structure Sprinkler System all over Fire hydrants Security Guard Patrolling 24 hrs

Strategy to Reach customers

Bulk SMS Holdings Seminars for the target group of customers Door to Door Marketing for the target group of customers. Special Discounts for the confirmed reference of customers News Paper Advertisements Social Networking Media Phone marketing with the targeted group of customers.

S.W.O.T Analysis

Strengths
Economy costing Flats. Infrastructure in Place. Highly suitable Locations. Very Focused Management. Well Rounded & Managed Business

Weakness
Focus may be too narrow Lack of awareness amongst prospective customers Lack of strong sales/marketing expertise

Opportunities
Market segment is poised for rapid growth. New material offer great potential. Potential to diversity into related market segmentation.

Threats
Economic slowdown could reduce Demand. Market may become price sensitive. Major player may enter targeted market segment.

COMPETITION ANALYSIS

MRPL Location Lichubari

Laxmi Construction Dohabora chok

Advantages with MRPL Equidistant from all major area of Jorhat Bigger size Flat

Size

2000 sq.ft

1365 sq.ft.

Price

Rs 1300 to 1600 Rs 1500 to 2500 per sq.ft. per sq.ft.

Most attractive price

Bank Gurantee

Yes

No

Risk Free

Unique Selling Proposition (USP)

Building Dreams