MERCU MAYA REALTY CONSULTANTS SDN BHD

FEASIBILITY STUDY
OF
SEASIDE
DEVELOPMENT
 PREPARED FOR:

TUAN HJ. BAHARUDDIN BIN MOHD HANIPAH

LECTURER OF DEVELOPMENT APPRAISAL
(EMT 551)

PREPARED BY:

ABDUL RAHMAN BIN ABDUL KARIM

AMIRUL ASYRAF BIN MOHD YUSOF
MOHD ASHYRAF BIN BASRI
SYED AZZIM BIN SHEIK ALI
AHMAD SHAHRIN BIN SAID
MOHD SAFUAN BIN HILMI
 SITE FEASIBILITY
ECONOMICS FEASIBILITY
MARKET FEASIBILITY
DESIGN FEASIBILITY
FINANCIAL FEASIBILITY
SITE FEASIBILITY
 LOCATI
ON

 The subject is under Majlis

Perbandaran Kuantan and it is
located approximately 2 km
north of Kuantan City, Airport as
the regional transport hub.
Beserah is connected via
Kuantan-Kemaman Road and
Lebuhraya Pantai Timur.
SUBJECT
PROPERTY

LOT NO 948
MUKIM OF SUNGAI
KARANG
DISTRICT OF KUANTAN
PAHANG DARUL MAKMUR
 DESCRIPTION OF SUBJECT
PROPERTY

 Thesubject property is a parcel of

an almost rectangular in shape
land containing of approximately
4.7 acres of Lot PT 948. The
subject property is located within
Pantai Balok, Beserah, Mukim of
Sg Karang and District of
Kuantan. It is generally flat in
 PARTICULAR OF TITLE
Title No : HS (D) 6943
Lot : PT 948
District : Kuantan
State : Pahang Darul Makmur
Tenure : Freehold
Category of Land Use : Building
Provision Land Area : 4.7 acres
Registered Owner : TANCO HOLDING SDN BHD
Encumbrances : NIL
Express Condition : Tanah ini hendaklah digunakan semata-mata
untuk Bangunan Perniagaan.
Restrictions In Interest : Tanah yang diberi milik ini tidak boleh
dipindah milik, dipajak atau digadai melainkan

dengan kebenaran Pihak Berkuasa Negeri.

SUBJECT
PROPERTY
SURROUNDING
NEIGHBOURHOOD
ECONOMICS
FEASIBILITY
POPULATION AND ANNUAL GROWTH IN
DISTRCT OF KUANTAN (1999-2005)

GROWTH
GROWTH RATE
MUKIM 1999 % 2005 % (1999-2005) (1999-2005)

Kuala Kuantan 200,712 78.41 280,642 78.33 79,930 3.80

Sungai Karang 20,051 7.83 32,906 9.18 12,855 5.66

Beserah 9,593 3.75 12,220 3.41 2,627 2.73

Penor 4,487 1.75 6,001 1.68 1,514 3.28

Ulu Kuantan 5,952 2.33 8,776 2.45 2,824 4.41

Ulu Lepar 15,179 5.93 17,717 4.95 2,538 1.73

DISTRICT OF
KUANTAN 255,974 100 358,262 100 102,288 3.81
NUMBER OF TOURIST IN MAIN
DESTINATION IN PAHANG (1999-2003)
NUMBER OF TOURIST (YEAR)
DESTINATION 1999 2000 2001 2002 2003
Kuantan Area 614,463 785,486 821,356 889,691 538,343
PERCENTAGE (%) 19.99 23.50 24.01 16.87 15.07
OTHER AREA
Genting Highland 1,888,159 1,918,678 1,918,678 3,525,169 2,362,936
Cameron Highland 278,799 305,995 301,995 364,930 309,884
Pulau Tioman 185,994 200,527 243,052 213,172 72,388
Rompin NA NA NA 78,904 50,056
Fraser's Hill 32,154 47,963 47,910 60,699 62,879
Taman Negara 50,778 55,675 58,770 56,121 111,675
Bukit Tinggi NA NA NA 44,437 41,128
Kuala Lipis 23,755 27,461 28,924 28,924 22,087
TOTAL 2,459,619 2,556,299 2,559,329 4,372,356 3,033,033
PERCENTAGE (%) 80.01 76.50 75.99 83.13 84.93
NUMBER OF TOURIST IN DISTRICT OF
KUANTAN (2000-2003)
NUMBER OF TOURIST PERCENTAGE OF TOURIST (%)

DAY LOCAL FOREIGN

YEAR TRIPPERS OVERNIGHT TOURIST TOURIST TOTAL LOCAL FOREIGN TOTAL

2000 327,750 785,486 738,517 279,719 2,131,472 72.53 27.47 100

2001 144,979 821,356 712,431 253,904 1,932,670 73.73 26.27 100

2002 166,667 889,691 806,216 250,142 2,112,716 76.32 23.68 100

2003 638,526 622,214 996,638 264,102 2,521,480 79.05 20.95 100

TOTAL 1,277,922 3,118,747 3,253,802 1,047,867 8,698,338

% 100 75.64 24.36

AVERAGE OCCUPANCY RATES OF
HOTELS IN DISTRICT OF KUANTAN
(2004-2005)

LOCALITY 2004 2005

Kuantan 58.2 % 66.4 %

 The increasing of rate (58.2% to 66.4 %)

caused by the Pantai Timur Highway and
the improvement of Kuantan
development.
 The increasing will give the good effect to
growth of hotel industry in Kuantan.
 MARKET
FEASIBILITY
COMPETITORS

Shahzan Seri Malaysia Duta Village & Duta Sand

Inn Hotel Beach Resort

Mega View Tamuka Grand Continental

Hotel mi Hotel
MARKETING STRATEGY
 LOCATION
 A strategic location (Pantai Balok) at the
seaside of east of peninsular opposing the
South China Sea area which popular with
its beautiful and bright beaches is a good
destination for tourists and visitors.

 EXHIBITION
Participating in a local authority
organized regional exhibition or trade fair
may be better.
It can be held wherever suitable like
shopping complex.
The photographs of hotel was prepared to
ACCOMODATION / FACILITIES

Type of Room No. Of Room Rate TYPE OF FACILITIES TOTAL OF UNITS

Rooms (RM)
Pub and Lounge 1
Chalet 20 140-160 Restaurant 1

Swimming Pool 1
Long House 1 22 90-120
Souvenir and gift shop 2

Long House 2 8 120-150 Multi Purpose Hall 1

Accommodations 110
Studio 60 120-140
24 hours rooms services 110

Total 110 Parking Bays 110

Air-Conditioning All

Sport Facilities 4
 MEDIA ADVERTISING
 Through newspapers, magazine and
television.
 Through heavy promotional activities
especially on signboard beside major
highway and also near the development
site itself.

 SURVEY
 Surveyed by researcher should be taken
which would give some consideration
regarding the development.
TARGET MARKET

Social activities for example visiting

relatives and friends
Labor (working at kuantan port, industrial at
Gebeng).
Parents coming for student’s convocation in
Universiti Malaysia Pahang,Universiti Islam
Antarabangsa Malaysia and IKIP.
People attendance for conference, meeting
and formal activities.
Tourists( both local & foreign )
SWOT ANALYSIS
 STRENGTH
Good accessibility with direct access from
Terengganu - Kuala Lumpur – Negeri Sembilan
Kuantan is main Administration centre of Pahang.
Kuantan has many beautiful and interesting places
i.e.Taman Negara, Telok Chempedak & Pantai
Balok.
The proposed hotel is near to the administrative
centre of Kuantan

 WEAKNESS
 There are 6 hotels as the competitor at the
surrounding area.
 OPPORTUNITY
The improvement of the road network may
attract passers by- lebuhraya Pantai Timor
The subject property would be able to
capture the market demand due to the
surrounding township
It has a ready market from the expanding
population from Kuantan and all of Pahang

 THREATS
 The economic slow down and the
uncertainty of the world economic will
affect the demand for this project.
 Competition for the subject property can
be expected from other projects planned
by state government to save the market
 DESIGN
FEASIBILITY
LAYOUT 1
25m Longhouse 2

15m
Longhouse 1

11m
20m

Lake

15m
Tennis Court

20m
Admin office,
lobby, Studio,

Multipurpose
Hall Chalet
Swimming
Restaurant

pool
LAYOUT 1
LAYOUT 2 Deluxe

30’
First Floor 10’

Multipurpose
hall
Basket Ball
72’

Office
66m
Ground Floor
Restaurant Lobby
30’x100’
180’
Tennis Court

Chalet Chalet

Kids Pool
45’ x 10’

28\’
Swimming
Chalet Pool Chalet
10m x 25m
28’

Volley Ball Volley Ball

LAYOUT 2
CONCEPT
FORMULATION
 The concept of the resort itself is a ‘Beach
Village’.
 With the number of rooms and facilities
provided, the resort would be comfortable
enough for all generation to cater their
accommodation and their business activity
purposes.
 The sport centre and restaurant could
cater the customer leisure activities.
 The resort also has a garden with well
designed landscape consists of many
CONCEPT OBJECTIVE

 To give an identity to the development

as it is a new development in the beach
area.
 To boost a good prospect of income as
its location is in the famous beach area
of Kuantan itself.
LANDSCAPE DESIGN
 Shade and control glare from the sun.
 Control wind direction which comes
directly from the lake.
 Screening and visual control to certain
area of the development.
 To add the aesthetical value to the
development.
 To show our socio-cultural through the
landscape design.
 For the matters of ecological aspect such
as a preservation of the animal habitat &
natural environment
 Green lung and microclimate modifiers.
 FINANCIAL
FEASIBILITY
financial studies are based on:
 The adopted concept and land used
distribution as formulates in the
design plan

 Preliminary
estimate on cost and
expected on cost and expected
revenue

 Some planning assumption relating to

the utilization of land and quantity of
occupier
METHODOLOGY

 Profit Method
 Investment Method
 Residual Method
 Discounted Cash Flow Approach
DEVELOPMENT APPRAISAL

 Option 1
 Option 2 (Alternative)
OPTION 1
 GROSS DEVELOPMENT VALUE :RM
16,262,591
 TOTAL DEVELOPMENT COST :RM
11,256,452
 DEVELOPER’S PROFIT :RM
5,006,139
 PROFIT (%) AS PER GDV
:31%
 PROFIT (%) AS PER TDC :44%
OPTION 1(CASHFLOW ANALYSIS)

 INVESTMENT PERIOD :15

YEARS
 COST OF FINANCE :8%
P.ANNUM
 PROFIT AS AT THE END OF
INVESTMENT PERIOD :RM
22,457,469
 NET PRESENT VALUE :RM
7,823,263
 IRR
OPTION 2

 GROSS DEVELOPMENT VALUE :RM

23,548,122
 TOTAL DEVELOPMENT COST :RM
17,344,525
 DEVELOPER’S PROFIT :RM
6,203,598
 PROFIT (%) AS PER GDV
:26%
 PROFIT (%) AS PER TDC :36%
OPTION 2(CASHFLOW ANALYSIS)

 INVESTMENT PERIOD :15

YEARS
 COST OF FINANCE :8%
P.ANNUM
 PROFIT AS AT THE END OF
INVESTMENT PERIOD :RM
30,049,786
 NET PRESENT VALUE :RM
11,328,032
 IRR
STATEMENT
As for the purpose of this report, after taking into
consideration all relevant factors related into our analysis of
the subject property;

 We hereby state our profitability & viability statement on

the suitability of investment for the proposed
development as feasible & viable for both Option #1 &
#2.

 However, from figures that we shown above, we can

conclude that the best investment option derived from
our analysis is Option #1.

 Tuan Haji Baharudin shall deem for Option #1 as it is

more viable in terms of profit % over GDV & TDC and
also the good % of IRR.
CONCLUSION

Based on our analysis, we are of the opinion that the

project is feasible to develop at this time. It is based
on the current economic growth that reflected our
projected cash flow.

From analysis of both options, we can conclude both

investments are feasible and viable. However, we
are of the opinion that the option 1 is a better
investment option as compared to investment no.2.
This is based on the following point:-
• The purchaser (developer) will easily get the end finance and
bridging finance from the financial institution.
• Based on the economic situation at this moment, there is a
positive growth and this situation will enhance the confident
level among the local investor and even the foreigners to invest
in Malaysia.
• The high purchasing power among the Kuantan resident will
ensure the success of our target market.
• The developer’s profit from GDV is 31% and from TDC is 44%.
(refer to cash flow)
• Higher Internal Rate of Return (14.1377%) as the borrowing rate
just at 8% per annum.
THANK YOU