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Johannes Jacobus van As
Business plan for setting up a modular home construction and lettings company for the South African student market
Greenovate End street 230 Clubview Centurion South Africa 0699 +27723357350 2/22/2012
Table of Contents Executive summary Business Description Mission statement Location, Background and History Location Background History Product description Suppliers Business Opportunities Potential customers Geographical area Business competitors SWOT analysis Marketing Strategy Costing Pricing Sales projection There will be very few sales in the first 2 months of the business, at the end of the 3rd month when phase 1 is complete the company will see the first income which will equate to R 6 153 600 Marketing plan Business Operations Operational function Team Technology Finances References
Appendices Solving the student accommodation problem
Organization of the document Since the conclusions and information in the business plan are directly formed from the supporting research, there will be repetition. A business plan is fundamentally a living document, developing as the business progresses and new decisions are made, so this document represents a snapshot in the beginning of the development of the business plan. As the company is formed and work begins, the shape of the business will likely change from what is represented here.
Executive summary Greenovate is a designer and builder of green modular flats in the Gauteng Province in South Africa. The aim of the company is to address the growing demand for affordable living while reducing the impact on the environment while filling the gap in the market for student accommodation. This is due to an increase in the amount of students going to university, along with various socio-economic factors which have basically reduced it to a scarcity. Students also became more aware of their surroundings and the environment; this gives Greenovate the chance to create a new market sector within the housing industry in South Africa. The focus of the company will be on providing sustainable living in green modular flats or studios, without compromising on luxury. Greenovate is a company that will establish its presence in two market sectors, the one being in the construction of modular homes and the other sector that of letting out flats to students. This duality of the company will give it a competitive edge as it will fully be able to control supply and demand of its product in the student lettings sector and be able to diversify its product in the other sector. Also using the efficiencies of modular construction, Greenovate makes green features available without a high price tag at a much faster pace. Greenovate will have only one standard container set-up when we start off but the idea is to offer a wide spectrum of luxury housing options to students and later to the general public.
Business Description Greenovate is a start-up company that will incorporate as a Private company (PTY) based in Pretoria South Africa. The advantage of registering the business as such is that it will give Greenovate a more professional image as well as having tax benefits. The ownership structure will be based around shareholders and that depends on how many people want to invest in the company. Greenovate’s purpose is to build and design modular green homes. The focus will be to design, build and sell affordable sustainable modular homes for students and young people just starting out. The idea is to make use of old shipping containers and turn it into liveable, stackable units that provide a comfortable living at an affordable price, yet very energy efficient. These container homes will be price competitive in comparison to regular modular homes while offering the value-added benefits of high design and sustainable materials and methods. We will compete with construction companies marketing to students and younger people as well as with other companies providing modular accommodation. Greenovate will be the only company in the market making use of shipping containers as modular homes for students with a focus on being green. Customers will prefer our homes over those of other builders because of our excellent designs, lower prices, shorter construction time, and lower environmental impact over the entire building life-cycle. The company will exist in two parts, the first will be the manufacturing section of the container units which can later diversify into selling off the container homes to private customers as stackable accommodation, hotels or other types of private accommodation The second part of the company is using to build complexes and renting out or selling the flats to students.
Mission statement To provide sustainable comfortable living that is cost effective with the least amount of damage to the environment
Location, Background and History Location The factory will be located in Centurion which is based close to the University of Pretoria (UP), University of Witwatersrand, University of South Africa (UNISA), University of Johannesburg (UJ), Centurion College, Tswane University of Technology (TUT) and a few other private universities and colleges. This means the container homes can be transported to location with the least amount of effort and the prospect to put up student housing close to each university is great. The location where the container homes will be built as well as the first location where the student flats will be set up is at the location below, which is based in Centurion. The grounds is about 2 hectares in size. The containers will be converted in one area of the grounds in the open air, with only a roof covering it. Therefore the setup cost will be kept at a minimum. The other reason for choosing this location is that it is a very central location in a secure area which is of the utmost importance and, it is close to all student amenities and the GAUTRAIN
(End street 230,Google earth)
Fast train service equivalent to the underground
Background Housing is an increasing problem, especially in highly populated areas. More and more people are moving to residential areas which are becoming over populated. There is not enough housing and building time can take anything from a few months to a few years depending on the type and size of building being built. Other factors that needs to be considered is price, it is very expensive to build normal homes or flats in South Africa especially in Gauteng. The reason for this is political as well as economic factors like the rise in price and availability of cement due to a shortage. There is also shortage of electricity and water as well as sewage problems due to a lack of planning for extra power stations, dams and poor city planning. This makes the housing market a very difficult one to enter. Especially as some municipality’s has stopped planning permission for certain types of building for up to 7 years. Security is a huge problem in South Africa and therefore housing needs to be very secure and best be built in clusters and in a security village as less break-ins or armed robberies occur in these complexes. Also best to have electrical fences surrounding the place as well as have security guards. Therefore coming up with a product that can be built quickly, cost effectively, that accounts for the climate conditions as well as being spacious, luxurious, in a secure environment and energy efficient would be easily approved and well accepted by the local government as well as people wanting to move into these complexes History The idea for the company arose out of an interest for green living and modular home design as well as the idea of making use of recyclable materials in return providing healthy living, optimum design and limiting the negative impacts of housing on the environment while being sustainable. The CEO noticed that there is a gap in the market for student accommodation that is affordable yet comfortable and green. Therefore the CEO decided to start-up a company in a niche market that will cater as a green company providing much needed accommodation surrounding universities, the idea is to later expand the company into modular hotels and other products but that is the long term goal.
One shipping container will be converted into 2 small studio flats, which is very similar in size compared to student accommodation found in the university hostels as well as the student accommodation found in Hatfield. The floor space will be about 13.5m2 per flat. The container entrance will be fitted with a glass door and windows which are double glazed to let most of the light in as well as keep internal environment insulated. It will be fitted with wooden laminated floors and the walls and ceiling will be insulated with insulation foam covered with dry-walling. The lighting used in the house will be LED to conserve most energy. The bathroom will be one meter in length and the full width of the container which is 2.33m. The one side will be a wall which is 20cm in diameter fitted with fibreglass and soundproofing as it is the will that will divide the container in two. The other wall will be the backside of a built in cupboard to conserve space. Both walls will be coated with a waterproof layer and an extractor fan will be inserted that goes on with the light. The bathroom will be fitted with a shower which will a power shower to conserve energy, a toilet, and a sink also with an on demand water heater and a heated towel rail. The front room will have a double bed which is situated close to the built in cupboard. The base of the built in cupboard will also have drawers for extra space. The room is open plan and will also have a small couch and an LED tv fixed to the wall. There will also be a small kitchen with a microwave small fridge and washer/dryer. The kitchen sink will also have a on demand water heater so as to conserve energy and space by excluding a geyser. On top of the roof of the complex solar panels will be placed to provide electricity for the units. Used water from the kitchen and the bathroom will be filtered and fed into the toilet and in that way reduce water wastage. A sewage digester will be placed under the complex to produce methane which can be used for electricity generation or for providing gas to the flats. Traditional modular Cost/ sq m
traditional site built R6800
Green sitebuilt R8000
Figures for this table was obtained from Roeleveld quantities surveyors in the Eastern Cape. The figure for Greenovate was worked out by taking the estimate building cost divided by the size of the flat.
green Figure 1: A cost comparison of different types of construction options including Greenovate Environmental Financial 40 % less construction waste 37% lower price 50% more energy efficient 70% faster construction 50% more water efficient Figure 2: Advantages of Greenovate over traditional site built homes
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Intelligent design and site orientation No carpeting Non-toxic paint finishes and adhesives Double glazed windows and door Energy efficient appliances Waste water re-used
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Low-flow fixtures and appliances Bamboo flooring Formaldehyde free cabinets and adhesives Tankless water heating LED lighting Solar power
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● Sewage digester Figure 3: A select list of Green features within the Greenovate modular home
Standard container dimensions for the container to be used Internal 2.35 2.33 12.00m 2.28m 2.26m 28.33m2 External 2.59m 2.44m 12.19m
Container Height Container Width Container Length End door width End door height Floor area Container weight
The containers (flats) will be stacked 4 on top of each other and 10 next to each other so as to have a complex containing 80 studio flats with 13.5m2 living space. The first complex based in Centurion is situated close to the Gautrain which can give students access to most of the universities.
Figure 4: The diagram gives an indication what the student flats will look like. The only difference is there will be 10 containers next to one another to make up the block of flats.
The goal is to convert and install one container per week, and to finish the first 80 flats in a year. It will be installed in phases so that students can move in during the building process as well so that there is a return as soon as the flats are finished and installed Phase 1 will be to prepare the land while finishing up the planning permission as well as getting a sewage connection and paving a road. While this phase start the team will also start to create an awareness of the company and start building the first few flats which can be used for viewings. Phase 2 will be to install the first 10 containers which will be the ground floor in 3 months. Installation is planned to be less than a day after delivery and placement as container only have to be connected to sewage line electricity and water. Each container is fitted with its
own small piece of walkway, same width as the container which only has to be connected to the adjacent piece as well. This makes installation very quick. The first 20 flats will be advertised to students with a move in date set. The team will also search for another piece of land to set up a block of flats Phase 3. The 20 ground floor flats will be opened up to students for moving in. The first floor will be installed after all the containers were finished and 2 weeks to the end production will be used for aligning and installing the containers. Production time will be 10 weeks and then 2 weeks for delivery and installation Phase 4 and 5 is too install the next floor in about the same period of time as the previous phases while also starting to advertise and organising move in dates for these floors. Suppliers The materials and suppliers used for the building of the container flats will be heavily researched regarding the sustainability of the products. Suppliers will also be chosen on experience, reputation, their location and environmental commitment as well as the price of the materials sourced. Material qualities System qualities Is recyclable Is energy efficient Contains no or few toxins Water efficient Durable product Makes products locally Less resource intensive SABS approved where possible Locally made Sustainable Figure 5: The preferred attributes for suppliers to be selected. The secondhand containers will be sourced from big shipping companies like Merck, which is situated in Durban or Richards Bay in Kwazulu-Natal. Shipping containers can be transported from there by train to Centurion and a delivery company can transport the containers from the station to the factory. The second option it to obtain the containers from a secondary distributor like Joduwo Industrial trading, situated in Johannesburg, but this means the containers might be more expensive. The task of sourcing the containers and other materials at the best price, taking into account the above mentioned factors will fall to the business development and marketing manager. This person will help establish good relationships with reliable suppliers at the best price.
Business Opportunities Potential customers The first potential customers would be university students as well as young people starting out looking for accommodation that is affordable, safe, secure, luxurious and central. The second potential customer is outside buyers that want to put up container flats. Outside buyers will be obtained as soon as the company is ready to diversify by marketing the product. Potential outside buyers
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Private home owners that would like to put up a flat in their back garden Construction companies that want to put up apartments On site housing for mining companies and other companies Private businesses
Geographical area As discussed Greenovate will be strategically placed in Centurion, Gauteng, which is a central hub to the universities in Gauteng. Greenovate can easily transport the container flats to the selected locations where they will be set up. Also if the containers is to be sold to private owners. The company is based closed to the main national road (N1) connecting the major cities in South Africa. It is also situated close to a train station where the containers can be delivered nationally. Greenovate’s main focus will be on renovating the containers and setting up them up as student residences at selected locations across the country, first starting with Centurion. The next phase will be to set up one in Hatfield, Pretoria, after that 2 in Johannesburg at UJ and Wits. The next phase will be to set up accommodation in Cape Town and Stellenbosch in the Western Cape. Therefore the company will be distributed over South Africa in a period of 5 years. Business competitors Greenovate will compete in two sectors one with green modular builders that market their products to customers interested in modular flats. The second will be to companies that provides accommodation to students and young people. Customers will prefer our flats over those of our competitors because of our excellent design and functionality, lower prices, shorter construction time, the homes lower energy consumption as well as the lower impact
that our buildings has on the environment as well as the flats being in a secure environment close to all amenities. There is AfriPanel based in Johannesburg which is about 50km away from Greenovates proposed location. AfriPanel focuses on modular building for temporary situations. However they do not focus on style or green features and it does not look stylish or aesthetic, therefore in the niche that Greenovate wants to move in they will not really be a competitor.
Figure 6: AfriPanel modular home The next competitor is LogHomesGroup situated in Pretoria which is 15km from Centurion. This company focuses on prefabricated log homes, as they are focussing on game farms and lodges or farms they are not really a competitor. NOMC is the next potential competitor and they based in Bloemfontein in the Free state which is about 500km from Centurion. This company focuses on bigger modular home production, they might possibly the only real competitor as their designs are more stylish and they are reasonably priced. However they do not focus on student accommodation and also not on stackable units to form a block of flats. They also do not focus on green living features, and they are far from Centurion. These seems to be the only modular home production company in South Africa and only one have to be a slight potential threat as it is an established company with a good reputation, but as we are not completely in the same market there is very little overlap. In the other segment there are a number of competitors, however because there is such a big shortage in student accommodation, there is room for a lot more accomdation. What will set us out from the rest is the stylishness of the studio’s as well as the cost undercutting of being cheaper than most other options for the same luxury. SWOT analysis for Greenovate Strengths Weaknesses
Unique product Stylish design Affordable price Fast construction Good management team Only green modular builder Few competitors Energy efficiency of product
Over-dependent on student market Small company No established logistics in place
Diversification to produce different types of products
Increase in raw material price Decline in housing market New competitor in the market Government regulations
Expanding business into other regions
Increased popularity of modular construction
Costing The average cost per unit without installation will be R80 000 and an estimation of R15 000 installation cost which includes the delivery and positioning fee. Therefore one container consisting of 2 flats will cost R190 000 Pricing
As most of the flats will be rented out, the renting price is dependent on the area as well as security and luxury of the flat. Accomodation type University residence University flats Student private accomodation House share (commune) Private 1 bedroom house in Price to buy Not for sale Not for sale R 560 000 Not for sale R 500 000 Price to rent per year R 21 600 R 33 400 R 55 200 R 21 600 R 42 000
local non student area Private studio flat R 450 000 R 43 200 Figure 7: Average price for student accomdation in Pretoria (Anon., 2012) For the first block of student flats Greenovate can ask on average R3200-00 per month per unit, which will include council tax and water but will exclude electricity. Each unit will have a small electricity box where you type in a voucher to buy your months units. The electricity which will be generated via solar panels as well as the gas generators (obtained from sewage) and some units from the local grid will be sold at the same price as ESKOM3 If the units are to be sold in the already set up complexes they will be sold at R300 000 4 a unit and still have to pay the monthly levy of around R600 for security, council tax and water. If the units are sold as is for set up elsewhere, the container containing either 1 or 2 flats will be sold at R350 000 which will include delivery and set up cost of up to R30 000 Sales projection
Value Based Sales Forecast The idea is to have a ratio of 1:1:0.5 meaning 1 unit to let out, one unit in the complex being sold and one private sale of a container. In 3 months there should be 40 units in place (as 20 containers would have been converted) meaning 16 units should be rented out, 16 units sold and 4 containers (8 units) sold privately. This means that in a year’s forecast the company will have produced and sold or let out 78 containers (156 units) for the year which in the ratio of sales will equate to 63 units being rented out, 63 units being sold and 30 units (15 containers) being sold privately
Sole electricity supplier in South Africa R400 000 is the average price for a luxurious bachelors/studio flat in the Gauteng province
This equates to a yearly gross income of R 25 819 200 Figure 8: Breakdown of year 1 sales forecast Price per unit R 3200 per month R300 000 R300 000 Yearly gross profit R 2 419 200 R 18 900 000 R 4 500 000 R 25 819 200
63 units let out 63 units sold 15 containers sold Total income
Figure 9 Breakdown of quarterly sales forecast Price per unit R 3200 per month R 300 000 R 300 000 Quarterly gross profit R 153 600 R 4 800 000 R 1 200 000 R 6 153 600
16 units let out 16 units sold 4 containers sold Total gross income
There will be very few sales in the first 2 months of the business, at the end of the 3rd month when phase 1 is complete the company will see the first income which will equate to R 6 153 600
Figure 10: Pie chart showing the estimated sales projections ratio for the Greenovate product. 1 Income from lettings, 2 Income from unit sales, 3 Income from container sales.
Marketing plan Greenovate will be the first mover to move into the green modular house market specifically targeting students. This gives Greenovate the competitive edge and the style, design and functionality of our buildings as well as its security and its convenient location will be the main selling point. The project will be marketed in the following way. Website:
This will be an enormous channel of information and advertisement. The website will be easy to use focussing on the 3 click rule5 as well as aesthetically pleasing and have guided tours and video clips of our designs interior and exterior. You can have a virtual tour around the complex as well as inside the studio. It will also focus on the green options on why our buildings are better to live in for the customer as well as the environment.
Advertising: Greenovate will not make use of any paper marketing like pamphlets or brochures to keep a more environmental friendly approach. We will however email an interactive brochure to potential clients. The company will however advertise on boards in and around the university campuses as well as placing an advert in the university newspaper. Showhouse: We will try to work alongside the university to host a promotion week, promoting green living and Eco friendliness, during this time we will have a show house at the university that students can walk through and also have videos showing our dedication to green building features as well as the design and building of our product. We will also open up a show house in front of the complex which people can come and have a look at. As the area where the first two complexes will be built is very central with a lot of cars passing by this will attract a lot of potential customers Word of mouth: This is ideally what Greenovate would like to achieve, we do not really want to focus much on advertising but rather let the product advertise itself by people living in our complexes or that has seen our homes. We want our product to be of such a superior nature inside and out that it really gets people talking.
The three-click rule or three click rule is an unofficial web design rule concerning the design of website navigation. It suggests that a user of a website should be able to find any information with no more than three mouse clicks
Operational function The production plant based in Pretoria will be open air only a roof covering the containers and the office, workshop, and storage surrounding it which is built out of containers. This means that the set up cost for the factory is held at a minimum 2 containers converted into offices 2 containers converted into factory space 2 containers used for storage R 60 000 R60 000 R40 000 R15 000
Plastic Roof with split poles and concrete slabs
R175 000 The project manager and labourers will set up the plant, this will be done as soon as the company is set up and the people are hired. Before that the CEO will use his house to run the business from which is situated close to the plant. The workshop will be fitted with all the necessary equipment that might be needed to build the containers. It is still unclear on what all the equipment is that will be needed but the estimated budget for equipment is R500 000 The containers will be rested on 1m high concrete slabs to give workers access to the underside as well to fit plumbing etc. At any given stage there will be four containers in the factory which will be at different stages of completion. The reason for this because the containers is so big and easy to move, Greenovate will contract in a company to move the containers away. So after they start work on the fourth container, the logistics company will be asked to come and remove the containers and take them to the site for installation as well as replace them with new containers. The price of transport has been included in the container conversion price as it will be a variable cost dependent on the amount of containers moved. Enough stock will be kept to complete 7 containers at any stage so that there is always enough to keep on going, to make sure if anything happens regarding supplies (delivery or out of stock etc.) that the labour team can continue working. Team
As Greenovate is a start-up company it is best to start the company very small with a flat structure. As with most entrepreneurial ventures the team members will have many duties to perform. The team will be made up of energetic hardworking individuals, that have a passion for green living and design and will promote the company to the best of their abilities. The plan is to start the company with 10 people, where 5 people will make up the management team and the other 5 people will be manual labourers to help with transformation of the containers as well as set them up at the location.
CEO: Janus van As As CEO, Janus van As will establish the strategic direction for Greenovate while making sure the day to day operations of the company is correctly performed. Janus will direct the organisation to achieve its goals and outcomes by developing and implementing strategic and operational plans, as well as integrating the work of all the team members to work well in a coherent group and meet strict deadlines. Janus will also select the other team members according to experience, personality and passion to build up a team that will work well together. Janus van As did a B.Ed FET (natural science), focussing on biological sciences and has a passion for the environment. During his studies he worked as a researcher and lecturer as well as managing one of the academic programmes. He then went on to do an MBA in Finance and Investment at the University of Gloucester, through SBL in London. The CEO will work with a recruitment firm to recruit people to fill the following positions which will be created to help run and manage the day to day activities as well as working on expanding. The positions that will be created for the company as a start-up is as follows: Business development and marketing manager This position will entail the procurement and strategy development for the company which will include consulting, strategic sourcing and process design as well as liaising with suppliers. This person will also be responsible for market research and analysis, administering marketing tools like market studies, signage, brochures, model homes, promotional events, product development and active promotion by word of mouth and networking. Sales and operations manager
This position will entail direct-to-customer sales, working towards a specific sales target and building up a customer base. Managing sales from order to delivery and liaising with the project manager. This person will also be responsible for compliance, quality control, labour relations and inventory. Accounts and administration manager This position will entail managing production schedules as well as managing the lettings, controlling the funds, managing the accounts and doing the ordering. Project manager This person will be directly responsible for day to day oversight of construction as well as the installation of container flats to strict standards and deadlines. This person also has to manage the team of labourers working with him/her, as well as working closely alongside other members of the management team. This person will also be directly responsible for coordinating building times and installation, quality control and site safety. Some of the roles will be interchangeable and as it is a start-up everybody is responsible to help out in all departments where needed. The CEO will oversee the management of everybody as well as taking on different roles and responsibilities, from sales to accounts depending where help is needed.
Technology Greenovate is not in an industry that is highly reliant on technology or where it puts the company at a major advantage. The focus would rather be on better service, product differentiation and lower prices as this gives companies a competitive edge in the construction market place. However Greenovate will be reliant on green technology that will be used in the construction of the container flats. Main technologies that will be used is solar power on the roofs of buildings to provide power for the LED lighting. The next would be next generation LED lighting for a major saving in electricity but not giving way to lack in light intensity.
Greenovate will initially require R 13 000 000 for the first year to set up the physical presence of the business. This will include setting up the factory, offices and buying all the equipment, and capital for the whole year’s container construction.
The capital for the variable cost and containers can be received quarterly as the whole amount will not be needed straight away, just enough to cover 3 months expenses.
General and administrative cost for Greenovate (Fixed cost) These costs which includes salaries are normally estimated at a percentage of the sales income. The average for the construction industry is 7% of the sales price. Based on the yearly production this cost falls just below the 7% margin. A breakdown of the administrative cost is given in the Appendix
Timeline and growth plan Milestones Obtain management Description The CEO will concentrate to find the best team to join the company + the projectmanager and labour will start a month earlier to set Register company up shop As a private company (PTY) and Design contracts get legal advice for employees and 3 months before company starts 3 months before Legal fees Legal fees Time required 3 months before company starts Funding required Salary negotiation in budget + R5000 for travel and time
other contracts needed for business Design and develop prototype functioning Building a prototype to green regulations and criteria working closely together with Build a network of suppliers and distributors the architect The CEO will do most of this before the start and then the Business development and marketing manager can continue Set up shop Building and setting up offices and factory shop and obtain tools Start building containers Construction team settled and start construction of Marketing Get SABS approved and planning permission for site prefab homes Marketing manager start with marketing Business operation managers will deal with city planning to sort out final details of planning and set Phase 1 Selling the first units up Working towards immediate sales and lettings for occupation 2 months Installation phase later Setting up the first
2 months before the company starts
2 months before start
R10 000 travel expenses and time
1 month before start
After start 2 weeks after start
1 week after opening 1 week after start ( gives 2.5 months time before installation of first containers) 1 week after start and continuous
3 months after
block of flats for students to move in
Gross profit Margin Direct Cost /Selling Price x 100 = GPM% R 80 000/R 300 000 x 100 = 387.948%
Fixed Cost Item Salaries Salary per manager Salary for labourer Loan for buying the land @ 12% Utility bills Phone Electricity Water Internet Other Interest and repayment on start up cash borrowing Banking services Professional Indemnity Insurance Web hosting
Estimated Cost R220,000.00 R24,000.00
Estimated yearly cost R1,100,000.00 R120,000.00
R2,000.00 R10,000.00 R2,500.00 R1,000.00 R5,000.00 R200,000.00 R500.00 R3,500.00 R500.00
R24,000.00 R120,000.00 R30,000.00 R12,000.00 R60,000.00 R2,400,000.00 R6,000.00 R42,000.00 R6,000.00
Bottom of Form Marketing Total fixed cost R50,000.00 R4,210,000.00
Item Container Insulation Laminated flooring Dry walling LED lighting Shower Water shower heater Toilet Plumbing Bathroom Sink &cupboard Sink water heater Built in cupboard Soundproofing Double bed LED TV Couch Coffee table Built in kitchen unit Multifunction microwave Kitchen sink Water heater Washing machine/dryer Fridge Glass door and frame Blinds Extra’s Total price per unit Rounded price per container
Price per item R20 000 R50 per m26 R80 per m2 R120 per board
R80 per m2
Total price R10 000 R1650 R2630 R1800 R800 R1500 R3000 R800 R3000 R1200 R1450 R2500 R450 R 2000 R8000 R1500 R300 R2800 R3000 R500 R1450 R3500 R2000 R5000 R1500 R15000 R77 330 R160 000
3 question Is setting up a business like this anywhere a good idea? Is there worthwhile demand for this type of product? .
The total wall/ floor space is 32.85 cubic meters this is the surface area that was used to worked the pricing for items that is prices per square meter.
What would local people want from such a product?
* Who makes up the target audience? * What do they want? * When do they need it? * Where does it sell best? * How can it be taken to them? * Why do they want/need it? * What are our competitors doing? * How is our market changing?
ConLIV flats are constructed in a open air factory in the Gauteng area. A single containers is turned into either one or 2 small studio flats.. These homes are a standard size and can be either one or 2 units per container. The workers at each station will be trained and skilled to complete these homes to a high quality standard. Greenovate sets out to get its container homes SABS7 approved. The flats will be 95% complete when transported to the site with only connection to water, electricity and sewage needed. The result is a beautiful, high performing, healthy, green flat at a fraction of the price of traditional, on-site-built flats. The flats can be stacked closely together and on top of each other saving space
South African Bureau of Standards
Google earth. (2012). End street 230. Available at: www.googlemaps.com [Cited: 20 February 2012]
Solving the student accommodation problem 01 Dec 2004
With matric exams now behind them, the parents of many university or college hopefuls will soon have to address the problem of finding them suitable away-from-home accommodation next year.
And it could be a serious problem, says Berry Everitt, MD of the Chas Everitt International property group. "In the first place, most universities have insufficient hostel accommodation to meet demand.
"According to a recent Rapport article, only about 15 000 of the estimated 63 000 students who will attend Wits and the new Johannesburg University next year will be able to be accommodated in hostels. In Stellenbosch, there is only room in the hostels for about 6500 of the university's 22 500 students."
Secondly, he says, although there are student apartment developments springing up around most universities, up to 80 percent of the units are being bought by investors and rentals are high. "In the new complexes close to the old RAU campus, for example, the rent for a 25sqm one-bedroom unit is about R1800 a month, and that for a 67sqm one-bedroom unit up to R2950 a month.
"In Hatfield, close to the University of Pretoria, landlords are asking up to R2800 a month for one-bedroom student flat and up to R1900 a month for a studio."
However, he says, current market conditions are making it possible for many parents to consider as an alternative the purchase of an ordinary flat or house to be used as offcampus "digs" while their children are studying.
The current low interest rates mean that the repayments on such a property may actually be lower than the fee for a hostel room or rental for a "student" flat – especially if a group of parents form a syndicate to buy a house.
"Such properties are also likely to be good investments, with parents whose offspring have graduated able to find a ready market among the parents of "incoming" students in years to come – and to generate a profit than can be used to put a new graduate on his or her feet financially." Mike Spencer of Platinum Global says student accommodation in Bloemfontein has also become a major headache for parents, students and neighbours.
"Even though many students have already left the varsity at the end of the academic year, we are still getting enquiries for student flats. Even with the number of flats that we have to rent, we expect them to be full long before the students start coming back next year. "Some investors have taken the opportunity to buy up houses in the Brandwag and Universitas suburbs and convert them to dense student accommodation often housing upwards of 12 student per house, but this has not been popular with everyone, especially when student house owners do not exercise control over their student tenants. This has led to a number of incidents during the year, where neighbours have complained to the police and municipality about noise, and lack of maintance."
However, local developer Delan Kruger has now developed 288 well-appointed bachelor flats in Faure Ave Willows, which not only provide much needed accommodation but also 24-hour gated security. Roving security patrols will also be provided within the complex in order to control any unruly behavior and excessive noise.
The development, which consists of 15 separate apartment blocks, is proving to be very popular with parents as well as investors. Originally sold for R110 000, units are now still selling for between R150 000 and R160 000. Rentals are around R1500pm including a parking bay. http://www.property24.com/articles/solving-the-student-accommodation-problem/2177
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Extra information http://web.up.ac.za/sitefiles/file/121/Accommodation%20fees%202012.pdf http://www.afripanels.co.za/ http://www.noversea.co.za/site_files/index.asp?pid=3&spid=17&parentName=Modular Homes