Flexible Space System Cost Savings – AET Flexible Space

Flexible Space System Cost Savings

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Cost savings will be achieved over the whole life of the Building, not on just the initial construction

FSS offers cost savings in nine areas which may be applicable to your project

1.   Reduced height of construction
2.   Reduced interior finishing costs
3.   Reduced programme time on site
4.   Reduced financing costs
5.   Reduced cost of re-configuration
6.   Tax advantages
7.   Reduced operational costs
8.   User comfort
9.   Design flexibility

Lifetime Costs

in the late 1990’s, AT&T published the figures that show the proportion of costs for a typical building over a forty year life span to be in the order of:

11% Initial Construction Cost
14% Financing Costs
25% Reconfiguration Costs
50% Operational Costs

Whilst much effort is going into studies to reduce the initial construction cost; even if they enable savings for 5% of that element it still only accounts for 0.5% of the total cost. The design, operational and financial savings are probably more significant.

1. Reduced Height of Construction

There is no need for a false ceiling. Although the depth of the floor void must be increased by 100-150 mm to accommodate Flexible Space, this offers a net saving in the order of 300-400 mm in floor to ceiling height.

This means that the construction height in many cases can be reduced by 10-15% with major savings in construction materials, curtain walling, structural frame, lift shafts, service risers and stairwells. One pension fund has quoted around 5% – 7% reduction in the total project cost.

To emphasise this saving in another way; you may be able to have eleven floors in your building for the same total height as only ten in a traditional style building.

2. Reduced Interior Finishing Costs

There is no requirement for levelling screed on floors; the pedestals of the raised access floor can be used to take up the undulations of the structural slab, offering perhaps 50mm additional height. There can be substantial savings in time and cost in avoiding the need for screeding the floor.

There will be reduced cost in not having a false ceiling, using plaster on the underside of the ceiling slab, or use of a reduced specification for other ceiling finishes. There will be reduced risk of damage during installation and commissioning of ceiling services, saving wasted material and time to repair.

The removal of the need for a false ceiling makes FSS the ideal solution for refurbishment projects in older buildings with attractive ceilings, or where the building does not have the required floor to ceiling height to facilitate ceiling ductwork. Original floor covering materials can also be re-used on access floor panels to preserve traditional features, including ceramic, terracotta, granite, marble and parquet.

3. Reduced Programme Time

Installation of FSS is considerably faster than conventional ceiling systems, substantially reducing time on site.

Multi-trade activity in an area is reduced, again minimising damage and repair work.

4. Reduced Financing Costs

Reduction in building programme time offers huge savings in the total interest charge on the development. A 20 week reduction in programme could offer perhaps $US 5 million saving in interest charges on a 100,000 sq m development.

The nature of a floor based system permits delivery of key mechanical and electrical elements far later in the programme, and in some cases, permits the equipment to be supplied at the time of the tenant fit-out. Thus cash flow and cash demand can be improved, offering savings in interest charges on the development.

Taking 20% of the contract to be mechanical and electrical services, and if 50% of that element can be purchased 3 months later in the program, this could offer a further 2.5 million dollars saving.

Earlier release of the building permits letting to take place earlier. In Hong Kong rental is approximately $30/sq ft per year. Taking 50% of the space to be released early the increased rental revenue for 20 weeks equates to nearly 6 million dollars.

5. Reduced Cost of Re-configuration

On completion of construction, and prior to occupancy, re-adjustments of the air conditioning layout to suit tenant requirements can be achieved in around 1 week, compared to 12 weeks of a traditional fit-out.

Today’s offices continually change to suit requirements and expansion, with churn rates of 30% or more. FSS requires the minimum amount of time and money to adjust to these changes. Previous case studies include Panasonic, who estimated a saving of £150/sq m/yr, and Digital who calculated a saving of 30% in facilities related operating costs.

Traditionally any reconfiguration has meant the trashing of substantial quantities of partitioning and floor components. FSS is designed to be de-mountable and re-used.

6. Tax Advantages

Tax savings can be considered as an element which will help to reduce initial costs for the building owner as well as running costs for the incoming occupier. In using the access floor as a plenum for the air-conditioning, its status in the eyes of the revenue changes from ‘Fixture’ to ‘Plant and Equipment’ and in so doing attracts capital allowances.

Further, any materials placed on that floor are also deemed to be equipment and thus the CAM units, Fan Terminals, Grilles, Uplighters, Demountable Partitions, Carpets etc can be considered in the same way, (subject to acceptance in each case).

In one 12,000 sq m scheme the development consultant claimed to have increased his capital allowances by £8 million through the utilisation of the system.

7. Reduced Operational Costs

It has been shown by computer modelling that the system can save energy compared with both VAV and Fan coil systems. By using the access floor as the distribution route it is possible to utilise the thermal mass of the slab. Off peak tariffs can further reduce energy and CO2 emission.

One end user suggests a saving of 30% in facilities related operating cost is possible using such a system linked to a Building Management system. Another has quoted a saving in the order of £140 per sq m per annum. This equates to the rental bill in many cases.

8. User Comfort

User comfort is difficult to measure in financial terms, but experience shows that happy and contented staff work more productively and will reduce the impact of sick-leave and staff-turnover. Personalisation of the office layout and personal control of the local room temperature and air movement are key factors.

If people or equipment have to be moved, then FSS is easy to reconfigure to match the changed needs, and will continue to provide a modern and healthy work environment.

For comfort it is important to avoid draughts. Increased cooling demands from IT and communications equipment are now bypassing the ability of traditional ceiling and floor displacement systems to provide staff with a comfortable working environment. FSS has been designed to accommodate 200W/sq m cooling load without noticeable draught.

Rover Car Company reported findings of over 90% satisfaction compared with only 60-70% in other buildings.

9. Design Flexibility

Difficult to quantify in money terms, but FSS should provide the designer with:

  • Greater freedom of expression in design
  • Freedom for change and revision of the design in progress
  • Simplification of services design and installation
  • Reduced testing and commissioning

Summary

The tangible savings mentioned above equate to the following:

Construction costs savings $ 65 /m2
Financing costs saving $ 75 /m2
Earlier rental revenue $ 5 /m2
Demonstrating a total saving of perhaps 10% on the project.

The savings for the occupier could be:

Reconfiguration savings $200 /m2/year

Energy Saving $180 /m2/year

– plus significant intangible benefits

No developer can afford to ignore at least the investigation of such advantages on every project.  It is the responsibility of cost consultants to fine tune and verify the actual costs on each occasion.