Introduction
In this competitive era, selection of apt strategy is vital for proper business orientation. Hence, combination of strategy with project management can uplift a business remarkably. However, assessment of project feasibility is playing vital role in managing business projects. Current project belongs to real estate industry thus proper knowledge regarding real estate needs can be obtained through project feasibility analysis. This report includes goals of project alongside project constraints. Additionally, macro and micro drivers of a project are assessed through this project for determining its feasibility. Moreover, current report sheds light on project timeframe in order to enhance viability of project.
Goals of project
In order to provide proper accommodation to the growing population of Australia, current project has been initiated. The primary goal of this project is to provide satisfactory services to the clients of residency. Besides this, the project targets to build this accommodation for people within 9 months. Apart from this, project has incorporated a goal to accomplish this duplex development within $800,000 in order to maintain cost-effectiveness of their rooms.
Constraints of project
The project is conducting within NSW of Australia thus; it is evident to grab the approval for this project. However, financial constraint is prime constraint of this project. Project authority needs to develop their project within $800,000 as it has been estimated initially during project propagation. Similarly, in this current project time is emerging as another vital constraint. As per the given scenario, Residential Duplex Development Project of Australia needs to be completed within a 9 months. Hence, participants of this project needs to remember this constraint while going through this project.
Macro-environment drivers
It is obvious to assess the macro-environment drivers for the uninterrupted prospect of real estate project. Macro-environmental analysis provides broader insights of project that have huge impact over project propagation. As commented by Harrison and Lock (2017, p.57), selection of structure determines the future growth of project. Hence, inclusion of macro-environmental factors analysis can offer the ability of initial understanding of project. There are several influential factors in way of real estate projecting that need proper monitoring and these are as follows:
Economic Feasibility- It is obvious to maintain proper cash flow inside a project for its uninterrupted growth. As commented by Heldman (2018, p.49), suffice cash flow delivers a project strength regarding material selection. Since cash is emerging as a constraint factor of following project, thus determination of economic feasibility is vital in this aspect. In order to maintain the cash flow of this project it is obvious to understand most essential factors of this project and thereby elimination of invalid substances can be conducted. Baker et al. (2016, p.229) opined that, technical advancement of project is required that is entirely dependent on economic health of project. Thus, in order to understand the economic feasibility of project, breakeven analysis can be considered as ideal solution.
Application of breakeven analysis provides accurate knowledge regarding costs of project that might be fixed or variable in nature. Likewise, proper implementation strategy of cost can be identified through this analysis. Moreover, Orsmond and Cohn (2015, p.173) observed that, sales forecast is essential part of project. Hence, using this knowledge of proper cost allocation, project authority can estimate the sales of current project. On the other hand, tangible factors alongside intangibles can also be determined through economic feasibility analysis, which is vital for project prospect.
Competitive Feasibility- Competitive feasibility can also be termed as market feasibility study of the project. It provides in-depth information regarding market needs that are helpful for project risk mitigation. Waller et al. (2015, p.87) opined that, proper market assessment can help in target fixing for organizational growth. Hence, grabbing proper knowledge over market requirement, projects can be propagated successfully. As per the case study, current project is prospecting in a dense area of NSW. Hence, it is vital to understand requirements of people of area. Thus, gathering absolute information regarding residents need, current project can mitigate the threat of competitors. Alongside, proper strategy incorporation inside the project can deliver apt contingency plan to this project (Adamson et al. 2016, p.33). Moreover, using these market feasibility outcome local as well as regional clients can be grabbed by this project.
Hence, enhancement in people engagement can contribute in project revenue expansion. Similarly, apt knowledge regarding competitive feasibility can reduce processing errors and thereby decision-making of project can be strengthened. Similarly, proper understanding of startup funding needs and operational cost can develop the position of project significantly.
Resources Feasibility- This can be considered as one of the most essential needs of project. Lanfranchi and Giannetto (2018, p.337) stated that, energy is key resource of every project. Hence, appropriate information regarding energy requirements can scale up the condition of project whereby project can be conducted easily. Being a real-estate project, it is vital to understand the key resources of this project. It is evident that employees are pillars of an organisation thus employees can be considered as an important resource for this project. Moreover, clients are key assets for every firm thus customer engagement can be considered as key resource of this project (Varajão et al. 2014, p.59). However, following project is aimed to provide safe accommodation to the people of NSW. Hence, building design and construction materials can be considered as prime resources for this project. This proper idea regarding resource requirement can be grabbed through the resource feasibility outcome.
Demographic Feasibility- Demographic feasibility analysis can be considered as another important macro-environmental driver for projects propagation. Harrison and Lock (2017, p.67) opined that, improper understanding of demographic needs can reduce the performance of project. Hence, analysis of demographic feasibility is required to understand the perfect market for this project. Following real estate project needs to analyze similar projects in this region. Hence, grabbing actual data regarding similar projects this project can mitigate threats regarding project competition. Moreover, apt understanding of demographic needs can provide cost-effective direction to this project through which project can be progressed within estimated cost.
Microenvironment drivers
Feasibility study is reliable to estimate risks and opportunities for a project and thus, project managers in real estate business can securely go for feasibility study to explore opportunities lying in this ventured business platform (Kohlhepp and Kohlhepp 2018, p.69). Management-oriented activities are explicit in this concern to examine existing problems relevant to defined business strategy. Feasibility study is welcome in this situation to unveil untapped opportunities lying in this project pathway. Furthermore, whether endorsement or disapproval is negotiable in this situation of project management can be indicated through this feasibility study. Several micro environmental aspects are required to be considered to look after feasibility of this ongoing duplex residential complex project in New South Wales (NSW). This can be entailed herein as follows.
Technical feasibility- Technical feasibility is responsible for assessing the engineering feasibility attached with that project. Nevertheless, civil, structural along with other relevant aspects of engineering has to be considered in the due course of going through this feasibility study. In this context, it is obvious that competency of the chosen builder has to be assessed in this course of study. Personalized technical capabilities as well as technological aspects attached with this project need to be prioritized by the assessor (Shen and Ann 2015, p.18). In this context, it is worthy of being mentioned that technology transfer is a common phenomenon in multicultural communities. Several communities belonging to different cultural aspects inhabit NSW. Thus, during this feasibility study technology transfer in between cultures and geographical areas has to be incorporated. This will give the project manager to be knowledgeable about productivity loss or gain and other relevant implications.
Managerial feasibility- Managerial feasibility is a viable factor for assessing feasibility of a designed project in real estate business. In a similar sense, in this feasibility study, management capability along with employee involvement and employee commitment in this designated project has to be emphasized in order to ascertain the scope for managerial feasibility (Satankar and Jain 2015, p.807). This speculative approach would be extremely beneficial for this project in the sense that it would be able to address organizational structure of this project having an interpretation if management structure as well. This assessment of managerial feasibility would further ensure that proponent’s structure is suitable for operation undertaken in that project.
Cultural feasibility- Cultural feasibility is inevitable in this NSW-based duplex residential project. NSW is a dwelling place for multicultural communities with different religions. Cultural feasibility study would provide ample scope to developers of this project to estimate compatibility of that project with peripheral cultural environment in NSW. Since real estate projects such as the following one is going to be exclusively labor-intensive, thus, planned functions has to be integrated with local cultural environment (Shiem-shin Then et al. 2014, p.90).
Social feasibility- Real estate projects are definitely complementing societal needs. From this viewpoint, it can be argued that assessment on social feasibility would be a good point to be considered to overcome potential barriers generated from social resources (Ahadzie et al. 2014, p.960). Definitely, real estate project environment is a complex one in a crowded location such as NSW and complexity may arise due to restricted social cognition about the residential projects, which may further impede the advancement of such projects. Thus, it would be useful to address influences of proposed project on surrounding social system. In addition to this, social structure is also a governing factor for availability of workforces in projects. Nevertheless, in this course of study individual has to go through impact if that project on overall social status of attached project workers (Sari and Setijanti 2015, p.850). This will make this project compatible with social perspective of this residential project.
Safety feasibility- Safety feasibility is an important parameter that has to be prioritized during this project planning. In this concern, individual has to have a broader knowledge whether the undertaken construction project can be implemented and it can be operated extremely safely with minimum adversity on surrounding environment (Squires and Heurkens 2016, p.580). Thorough analysis is required to be addressed to have a broader outlook about wider impact of this project on environment. This step would provide the developers of this project to be kept aloof from any environment-related legal obligations as well.
Time pressure feasibility- Proper timing is everything in successful completion of a project. Thus, time pressure has to be assessed to evaluate cost-effective project management. Therefore, it can be argued that before starting spending, real estate developers need to assess the time constraints in this project. In addition, construction contracts prevailing in NSW may also be assessed to have a better knowledge about time variable in this project.
Political feasibility- Inadequate political feasibility is definitely a constraint for operating a project with ease and this is extremely true for real estate projects such as this duplex residential project in NSW. In this connection, it can be argued that since this project is going to be funded with total $ 800,000, thus, it can be well anticipated that significant political implications along with NSW government inputs are going to intervene in this project. In the same sense, it can be forwarded that political necessity is going to be a moral support for this specific residential project (Olsson et al. 2015, p.529). In addition to this, political feasibility study would unleash whether there is any scope of insurmountable opposition originated from existing political situation in NSW. Needless to mention, this categorical feasibility analysis would require evaluation of compatibility in light of defined project goals along with prevailing goals of NSW political system (Manganelli, 2015, p.17).
Conclusion and recommendations
From the above study it can be concluded that this NSW-based residential project is required to conduct a proper feasibility study under proper guidance so that aim of this project to provide a perfect dwelling place to NSW inhabitants. Safe and secured surrounding environment may also be achieved in this way. Although some definite constraints such as time and money constraints cannot be ignored, however, these barriers can be ruled out with this application of feasibility study. Several macro and micro-environmental aspects has to be covered during going through this project.
However, instead of going through a generalized feasibility study, the developers of this project may incorporate dwellers of NSW so that a better result can be managed. In this concern, thorough surveys involving residents of NSW would be a good choice for reaching anticipated result for this designated residential project. Community participation in this study at a massive level would enable the developers to forecast potential problems underlying in this project. Careful documentation of identified constraints and assumptions has to be accomplished under proper surveillance of competent individual
Bibliography
Adamson, B.C., Learmonth, Y.C., Kinnett-Hopkins, D., Bohri, M. and Motl, R.W., 2016. Feasibility study design and methods for Project GEMS: Guidelines for Exercise in Multiple Sclerosis. Contemporary clinical trials, 47, pp.32-39. [online]. Available from: https://www.sciencedirect.com/science/article/pii/S1551714415301336 [Accessed 25/06/2018]
Ahadzie, D.K., Proverbs, D.G. and Sarkodie-Poku, I., 2014. Competencies required of project managers at the design phase of mass house building projects. International Journal of Project Management, 32(6), pp.958-969.
Baker, M.W., Atkins, A.E., Cordovado, S.K., Hendrix, M., Earley, M.C. and Farrell, P.M., 2016. Improving newborn screening for cystic fibrosis using next-generation sequencing technology: a technical feasibility study. Genetics in Medicine, 18(3), p.231.
domain.com.au. (2018). Thousands of owners on narrow blocks set to benefit under NSW government changes to housing code. Available from: https://www.domain.com.au/advice/thousands-of-owners-on-narrow-blocks-set-to-benefit-under-nsw-government-changes-to-housing-code-20180410-h0ykdz/ [Accessed 20/07/2018]
Harrison, F. and Lock, D., 2017. Advanced project management: a structured approach. Abingdon: Routledge.
Heldman, K., 2018. PMP: project management professional exam study guide. New Jersey: John Wiley & Sons
Kohlhepp, D.B. and Kohlhepp, K.J., 2018. Real Estate Development Matrix. Abingdon: Routledge.
Lanfranchi, M. and Giannetto, C., 2018. A feasibility study for a project of alternative energy production in an agritourism business in Sicily. International Journal of Environmental Studies, 75(2), pp.334-342. [online]. Available from: https://www.tandfonline.com/doi/abs/10.1080/00207233.2017.1376894 [Accessed 11/06/2018]
Manganelli, B., 2015. Real estate investing. Springer. [online]. Available from: https://link.springer.com/book/10.1007%2F978-3-319-06397-3 [Accessed 22/06/2018]
Olsson, N.O., Sørensen, A.Ø. and Leikvam, G., 2015. On the need for iterative real estate project models–Applying agile methods in real estate developments. Procedia Economics and Finance, 21, pp.524-531.
Orsmond, G.I. and Cohn, E.S., 2015. The distinctive features of a feasibility study: Objectives and guiding questions. OTJR: occupation, participation and health, 35(3), pp.169-177.
Sari, Y. and Setijanti, P., 2015. Value Management Perception by Practitioners in Real Estate Development Process. International Journal of Engineering Research & Technology, 4(07), pp.851-855.
Satankar, P.P. and Jain, A.P.S., 2015. Study of success factors for real estate construction projects. International Research Journal of Engineering and Technology, 2(4), pp.804-808.
Shen, G. and Ann, T.W., 2015. Value Management in Construction and Real Estate: Methodology and Applications. Abingdon: Routledge.
Shiem-shin Then, D., Tan, T.H., Fonseca Santovito, R. and Anker Jensen, P., 2014. Attributes of alignment of real estate and facilities management to business needs: An international comparative analysis. Journal of Corporate Real Estate, 16(2), pp.80-96.
Squires, G. and Heurkens, E., 2016. Methods and models for international comparative approaches to real estate development. Land Use Policy, 50, pp.573-581.
Varajão, J., Dominguez, C., Ribeiro, P. and Paiva, A., 2014. CRITICAL SUCCESS ASPECTS IN PROJECT MANAGEMENT: SIMILARITIES AND DIFFERENCES BETWEEN THE CONSTRUCTION AND THE SOFTWARE INDUSTRY. Tehnicki Vjesnik/Technical Gazette, 21(3).
Waller, H., Emsley, R., Freeman, D., Bebbington, P., Dunn, G., Fowler, D., Hardy, A., Kuipers, E. and Garety, P., 2015. Thinking Well: a randomised controlled feasibility study of a new CBT therapy targeting reasoning biases in people with distressing persecutory delusional beliefs. Journal of behavior therapy and experimental psychiatry, 48, pp.82-89.
yourinvestmentpropertymag.com.au. (2018). Developing A Duplex, Two Houses, Two Rents, Two Sales: Too Good To Be True?. Available from: https://www.yourinvestmentpropertymag.com.au/property-development/developing-a-duplex-two-houses-two-rents-two-sales-too-good-to-be-true-233858.aspx [Accessed 26/07/2018]
