Architectural & Building Economics

Done by: Žaklina Nježić

Neptun ID: JILYWG
Project: Kite and gliders competition center

FEASIBILITY STUDY
Consultant: Dr. Levente Mályusz

Spring 2019
Contents

Executive Summary .............................................................................................................................. 3

PLANS ............................................................................................................................................................ 4
Architectural Program (Functions)............................................................................................................ 6
Competitive Advantages .............................................................................................................................. 7
Project calculations ...................................................................................................................................... 8
Supply and Demand Analysis .................................................................................................................... 8
Financial Analysis ....................................................................................................................................... 12
Economic Analysis ...................................................................................................................................... 12
Cash flow Analysis ...................................................................................................................................... 13
NPV & IRR calculations............................................................................................................................... 14
Risk Analysis ............................................................................................................................................... 15
Conclusion .................................................................................................................................................. 15
Executive Summary

The proposed design offers the new function of the existing hangar at the hills of Hármashatár-
hegyi, and new, additional structure right next to it. Areas are public and semi-public, offering
the content for the locals, as well as attracting tourists.

Project name: Kite and gliders competition center

Sector: Public and Semi-public Sector
Location: Hármashatár-hegyi, Budapest

As mentioned before, old hangar stays in the already existing size, with the reconstruction of the
roof layers. Inside will be placed workshop area for making kites and remote gliders and hall for
the competitions and shows of windless kite performances. Other functions located on the
western side of the building are sanitary and mechanical rooms. Total area of the existing hangar
and new proposals is Area of the first floor: 400m2
Area of the second floor: 100m2

Extensional building is transparent, with curtain walls from all the sides, contrary to the hangar.
It has functions for café and restaurant, places for the MSE club and balcony for remote gliders
competitions. Because of the height, it also serves as a lookout point, attracting new people to
visit and enjoy the view. It has two floors, with smaller part which is connected to the hangar.
Area of the first floor: 176m2
Area of the second floor: 230m2

Construction of the hangar:

Structure is made out of masonry, which is also main load-bearing system. On the northern and
southern side, it has four external pillars in triangular shape, 120x25cm on the whole height. On
the eastern and western side, the columns are smaller – 90x25cm and also following the whole
height. Roof structure is supported by trusses.

Construction of the extension:

Load-bearing system is skeleton, with steel columns and beams in two ways. Elements are I and
C profiles, providing stability. Envelope is curtain wall; roof is made out of steel folded sheet.
Purpose was to create light structure, open to the visitors, offering the feeling of being close to
the nature.
PLANS

Site plan
 First floor plan

Second floor plan

Architectural Program (Functions)

Name of Space No. of No. of Allocated Space in M2 Total M2

Users Units
Workshop space 200m2

Competition hall 200m2

Hall 20 1 166
Jury room 3 1 34

Mechanical room 34 m2

Caffe and restaurant 364 m2

Sitting area 60 2 330
Toilets 8 2 34
MSE club 76 m2
Competitive Advantages

• Proposed design brings modern architecture together with traditional

• Taller than the previous design, will catch an eye
• Not damaging the existing nature, but compromising with it
• High quality material
• Connected to many biking routes
• New lookout point
•Suitable for all generations
•Suitable for different profiles: bikers, paragliders, locals, hikers
•Many functions in one complex of buildings
•Uniting people to spend time together
•Taking advantages of the location – place with beautiful nature within the city
•Usage of new, renewable energy systems
Project calculations

Supply and Demand Analysis

Average prices for similar activities

HALL:
Competitions: 5€/show

WORKSHOP:
Memberships:
Monthly – 50€
3 Months - 135€
6 Months - 260€
1 Year - 500€

CAFÉ AND RESTAURANT:

Restaurant average meal: 15€/meal
Bar average drinking user: 5€/person

GLIDERS CLUB:
Basic course (beginner): 350€
Intensive basic course (beginner): 350€
Advanced course: 200€
Safety training: 200€
Basic Acrobatics: 200€
Open day: 40€

The hill is well known to the locals as getaway place for the weekend or morning walks. Small hill
can be seen from where paragliders are flying or training. In existing complex, currently three
storages for gliders are available – two at the bottom and one at the top.
When the weather is nice, place is crowded with people. One side is used as a walking and gliding
area, another is on the famous Blue Trail route where many bikers and hikers pass by. By this
design, place can be used for short-time purposes (cafe, competitions) or long-time purposes
(gliders club, workshops). At the upper hangar, storage is used by the flying club MSE, and they
are occasionally gathering for flying, barbecuing or meeting. Inside of the new building, they will
have space that unites office purposes and meeting area. Percentage of their incomes will go to
the building. Hármashatár-hegyi site is famous for people’s result in gliding and the previous
generations had workshop where they made gliders from wooden parts. This way, hangar will
keep traditional values, and make profit out of it.
Commercial side is the café, opened every day of the week. In the area there are many
restaurants and coffee shops, but neither is in close relation to the site itself. Many pets have
been noticed walking with their owners, and the café should be made pet friendly, to attract
more customers.
Competitions can be organized once a week in spring and summer seasons, and two times a
month in winter and autumn season. Ticket for workshop can be bought for month, 3 months, 6
months or as an annual ticket.

EXAMPLE:
 World Kite Museum & Hall-Fame

Address: 303 SW Sid Snyder Dr, Long Beach, WA 98631, United States

Working days: Mon, Tue, Fri, Sat, Sun

The museum’s exhibits and educational events introduce the kite as a multicultural art, in
celebrations, modern day design, pulling power and application to energy production.

The museum houses artifacts, archives and displays in a 10,350 sq. ft. two-story facility.

The museum and hall have a great field where the kite competitions and festivals are being held.
Working hours are 11h-17h, and are most visited over the weekend.

ADMISSION TO EXHIBITIONS:

Adults – 5$

Seniors – 4$

Children – 3$
The museum has website and Facebook page for promoting current and upcoming events. On
the website the page about donating can be found, so people can voluntarily give certain amount
of money. Besides open-air kite festivals, it offers indoor kite competitions as well. The max.
number of participants for show is 25, with following fees:

WINDLESS KITE COMPETITION:

Participation – 5$

Watching the competition – FREE

The reason there is no fee is because the event is “sponsored by the City of Long Beach, The
World Kite Museum, and The Kite Shoppe”.

Bigger event than this one is the international summer festival, lasting for one week. Registration
lasts for five months and the festival itself is always held in august. Following fees are:

FESTIVAL:

Full week - $500.00 (first 10 feet) and

Weekend (Friday, Saturday and Sunday) - $450.00 (the first 10 feet)

For each additional 10 feet - $50.00

If approved with a Motor Home - $100.00

For being a member of the world kite museum, the price varies and includes Quarterly
Newsletter, Membership Card, Free Admission to the Museum, Invitation to special events,
Special preview of Inductees to the Hall of Fame.

MEMBERSHIP:

Bronze: $35

Silver: $50

Gold $100

Box Kite $25

Diamond $500

Rokkaku $1000
On the webpage http://kitefestival.com/about/friends-supporters/, supporters and sponsors can
be found. With a big list, museum has more sources than it would with exhibitions and events
only. Similarities between this object are multiple, from architectural and economic point of
views.

 Both objects have places for exhibitions and indoor kite competitions. Prices are similar
and number of visitors in proposed design would be bigger because the working hours
are longer.
 Festival from the example is organized on the beach and field in front of the object. On
Harmashatar-hegyi there are big green areas for making similar events. But, the
circulation of people would have to be observed in order to see if it will wake up the
interest of the locals and tourists.
 Besides kites, design proposes paragliding and gliding competitions organized by club,
which is similar to the membership in World museum of kites.
 Workshops can be found in both parts, in example it is small-sized for tourists, while in
designed building the scale is bigger and models would be taken more seriously, because
of the history the gliding culture has in Hungary and Budapest.

The museum has been opened since 1989. showing the successful 30 years of operating.
Financial Analysis
Income (Positive) Outcome (Negative)
Gliders club Equipment, number of skilled professionals, staff,
administration, marketing

Workshop Equipment, delivery of materials, transportation

of bigger elements

Restaurant Maintenance (cleaning/maintenance, managing

supplies)

Bar Utility and equipment (Upgrade)

Competitions Overcrowding or under crowding, equipment,
winner awards

Marketing
Infrastructure

Economic Analysis
Income (Positive) Outcome (Negative)

Higher value of the neighboring property Noise pollution and crowd

Higher Value of Land Transportation, maintenance of the roads

New income for local government, earning Taxes. Private properties rentals might increase too
much for people to rent

Higher income for local shops

Job Opportunities

Stimulation of local economy and supporting

small businesses
Cash flow Analysis

Investment Cost (Negative)

Land purchasing Average of 35 €/m2 35 * 1000= 35 000 €

Site is 1000m2
Construction Cost -1000 €/m2 1000 * 500=
-Building area: 500 sqm 500 000 €
Site preparation Assume 7% of the 7% *500 000= 35 000
Construction cost €
Operational cost (Negative)
Utility and equipment 3.5 € per square meter per 3.5*500*12=
month * 1 21 000 €
Maintenance effect (cleaning/Gardening ) 12Euro/m2 12x500= 6 000 €
Operation effect (staff) 4 € per square meter per 4*500*12= 24 000 €
month *2
Initial cost + Operational cost = Total cost 621 000 €

Income (positive)

Club 200€ of training / per week 200*52weeks = 10 400 €

Competitions 5 € per person (average 150 5*150*52weeks = 39 000 €

people expected) per week
Restaurant and bar 5€ / person 5*100*345 =172 500 €
(average 100 per day)
Total 221 400€

*1 3.5 € per square meter per month from analysis of different exhibition centers
*2 4 € per square meter per month from the analysis of different exhibition centers
*60% of the total income of the cafeteria, based on a study case (Food and
Beverage Cost Control book).

Initial Cost 570 000 €

(Land, Site preparation, construction cost)

Income (funds) per year 221 400 €

Outcome (operational cost) per year 51 000 €
Interest rate 10%
NPV 1 340 000
IRR 30%
NPV & IRR calculations
221 400 €

51 000 €

570 000 €

I= 10%

Sum Annual Income= Annual Income- Annual Operational Costs

221 400 €- 51 000€ = 170 400 €

NPV = - 570 000 + 221 400/0.1 – 51 000/0.1 = -570 000 + 221 40/IRR – 51 000/IRR = 0 =>

NPV = 1 340 000

IRR = 30%
Risk Analysis

Some of the major risk factors for the design proposal are:

• The project requires modern technologies and expensive materials

• The project location is on the sloped hill, accessing road is not enough
• The usage depends on the interest of people, and from weather conditions, which will
depend differently from year to year

Conclusion

We got a positive NPV value that means we are paying less than what the asset is worth.
When an internal rate of return or IRR is calculated on this set of cash flows, we get 30%. That
means that the percentage rate earned on each euro invested for each period it is invested is
exactly 30%. Therefore, the project is successful.