Housing Construction Project of Social Interest Quintana Villa Phase and Phase No 2 No 3

7/29/2019 Housing Construction Project of Social Interest Quintana Villa Phase and Phase No 2 No 3

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HOUSING CONSTRUCTION PROJECT OF SOCIAL INTERESTVILLA QUINTANA PHASE 2 AND PHASE No 3

ITAGUI COLOMBIA

1 - EXECUTIVE SUMMARY

In the Department of Antioquia, west-central Colombia is the city of Medellin and theMetropolitan Area consists of eleven municipalities with public administration differentfrom Medellin as the axis of the area. With immense wealth and extensive process ofindustrial development and services of different nature is ITAGUI municipality that ispart of the metropolitan area with a population of approximately 280,000. This town isone of the industry across the country.


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This territory is mostly flat has a gently undulating landform and geology that isconsidered by experts as one of the oldest in the country. With a hydrology consists ofstreams that drain into the Medellin River.

The general population is represented by several communities of Aboriginal ancestral

mixture by mixing with different groups of settlers from the mid-seventeenth centuryslowly settled in the area.

The climate of the area has the kind of transition between tropical savannah, alternatingwith humid with temperatures averaging at 26 degrees Celsius and rain with rainfallreaching 1200 mm per year.

Its economy is based on different sized industrial developments, the provision ofservices and trade in general.

However, it is a city with great problems and challenges as most Latin American cities.One of the major problems to be solved is a large deficit in housing and building of themsuffering inhabitants.

BUSINESS IDEA

Our Housing Association has better future social and active presence in the area. Hehas developed programs and projects of social housing for the different communitiesItag. Currently our ASOCIACIN MEJOR PORVENIR is running (under construction):

1) THE PROPOSED CONSTRUCTION OF HOUSING OF SOCIAL INTERESTQUINTANA VILLA PHASE No. 2, whose object is the construction of 180 (one hundredeighty) housing solutions for the same number of families.

2) In addition we are starting the formalities for the construction of Phase No. 3 with 600housing solutions.

We have all the legal permits and the allocation over the umbrella of the Colombianstate for the NO 2 and similarly do the same for the NO 3.

Our business idea is the rapid construction of the one hundred eighty (180) dwellingunits on the NO 2...And the inherent legally advance the construction of the NO 3, which has as its objectthe construction of 600 housing solutions for the same amount of low-income familiesand homeless. Future beneficiaries resident homeownership and decent housing atprices within the reach of their annual income (U.S. 10,800 household income)

- We will have financial support and sponsorship of the Colombian Government,represented by the Ministry of Environment and Housing (nationally), the Government ofAntioquia (Regional level) and the Municipality of Itagui (territorial level).

- Our associates conducted and savings each month pay period within which to access


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the different projects that our better future ASSOCIATION plans anddevelops,complying with the legal framework required by the laws and authorities.

Marketing is 100% guaranteed and will give priority to members of the Association arecurrently about 500 members and who meet the requirements.

VALUE PROPOSITION

We propose and apt to seek partners or financial investors to support our BETTERFUTURE HOUSING ASSOCIATION FOR THE VILLA PROJECT PHASE QUINTANANo 2 and No 3 to integrate and participate in the development and implementation ofthis ambitious and exceptionally profitable project. In this instance we have secured theauspices called government subsidies and contributions made by partners. We haveexperience in these projects and we have the support of different communities for 5

years, with assistance and social programs that allow us to represent the community inthese projects also result in employment generation and social investment .

Our BETTER FUTURE HOUSING ASSOCIATION offers our potential partners orinvestors this successful project, which responds to the following considerations:

A partnership with strategic partners in place to support us with their contributions(planned savings) in the same building, they benefit from the marketing and support inprotecting the environment

5 years experience in similar processes.

Marketing guaranteed.

Working together with the beneficiary community (partners).

Possibility of new construction projects run by the political will of the present rulersensure we build new housing developments.

We have the permits required by law

The execution was carried out with the community to ensure the safety for our staff

and contractors, helping to stay in the region, sparking new projects.

The beneficiary community (partners) can develop projects economic, social,environmental, and improvement of the new urban centrality.

The return on investment will be safe and fast.

TARGET MARKET

Our estimates of this target market penetration, are fully guaranteed by the nature of our


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association, government support and the wide and growing demand. Not enoughhousing supply in the municipality or the Metropolitan Area.

Our competitors are among the Colombian businessmen who manage in the middle,and often do not meet the requirements of various kinds that are required by existing

regulations. Competition from abroad threatens not recognize our Association, or havereferences to arrival with projects similar to ours.

Estimated revenue for our sales those raised in the financial summary below presents.The next exercise that corresponds to the reality of our Business Plan:

MARKET POTENTIAL

Our customers are the current 500 partners and more than 10,000 families who are

homeless own the characteristics of our project.

COMPETITIVE ADVANTAGE

We believe that the key factors of success of our project is what everything listed above.In addition, studies, georeferencing and characterizations made by the Ministry ofHousing, the Colombian Chamber of Construction - CAMACOL and Fedelonjas (entitythat studies price trends in the sector), we generated huge competitive advantage whenmarketing our project.

We have all our documentation and approvals duly approved and organized, ready toenter the construction phase (see attached photo folders of documents)


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SUMMARY BUSINESS SYSTEM

With our experience and the progress that we currently have deployed advancedbusiness system is based on the construction of social housing, at affordable prices and

government support to ensure economic and social benefits.

We have a work plan for the short, medium and long term, with clear goals andperformance indicators to ensure compliance with these and the economic benefits ofour partners and investors.

2 - GENERAL INTENTION-

SUBJECT'S IDENTIFICATION

THE ASOCIACIN MEJOR PORVENIR is duly incorporated in the Chamber ofCommerce South Aburr have a group of partners from different sectors of productionand economic, that as interdisciplinary team, offer their personal and financial supportunconditionally, with the aim to meet projected goals.

3 PROJECT DESCRIPTION

QUALITATIVE

To promote a better quality of life seven hundred eighty (780) FAMILIES welfare is


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about 1500 people within the family group, who do not own their own homes or worthyfamily whose income per capita is U.S. 10,800. year.

QUANTITATIVE

PHASE TWO: Completion of construction of 180 dwellings, urban works, facades andfinishes. Green areas and 30 parking

PHASE THREE: Diligence legal issues, permits, grants from the Colombian State,design and construction of 600 houses, besides the works of planning and completionof the details of the facades and interior finishes them.

4.- TECHNICAL ANALYSIS

Optimal size.

The size of the project is represented by the capacity (or the one installed by theproject). The optimum size is one that ensures the highest profitability.

- This is the construction of social housing

- Construction of 180 dwellings and 600 dwellings on a lot that we have pre-negotiated,subsidized to a great extent by the state.

Also be taken into account the following factors that are regulated by the state housingprogram of social interest (VIS):

Supplies of goods and materials. The power supplies in quantity and quality of inputsis a key aspect of our project, so we had to check the availability of them in the market,the potential exhaustion of inputs, price changes, etc..

We have a place to store raw materials and to preserve their quality and are readilyavailable.

The technology and equipment. We have considered the size and space requirementsfor equipment to be used in the project, availability of spare parts in case of breakage,among other things that we have analyzed to select the technology for the project.

Financing. is necessary to obtain financing, either through external or own resources.

Organization: We have adequate staff to assist you.

Optimal location.

In determining the sites where the project will have selected the location that will allowus to obtain the maximum profit. The determinants that were assessed are:


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Transportation costs of inputs and outputs

The availability and relative costs of factors and inputs:

Local and regional analysis.

Access to services (electricity, water, gas, Internet, etc.).

The location that had the highest score is where the project was installed in Phase 2and will be installed in Phase 3.

Project engineering.

Technical specifications and production processes are assessed according to the

following items that will be the engineering of the project and included:

Technical evaluation.

Technical information (description and specific features) on products, processes,technology and permits.

Analysis of the design and construction.

Confirmation or technical adjustment of the process.

Preparation of flow diagrams.

Manpower requirements.

Distribution of fronts.

Complementary facilities and electrical installations.

Security systems.

5 - SKILLS AND RESOURCES

PROJECT FEASIBILITY

In the summary of the project in Phase 2 and Phase 3 presented to you the main pointsdiscussed at a general level, corresponding to four basic evaluations to assess thefeasibility and leads us to give approval or approval of the assessments is that the

project is viable. the feasibility analysis studied and are generally summarized here:


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FEASIBILITY OF MARKETING

In our case since social housing built by Housing Association better future, under theauspices of the National Government, State and Municipal, in addition to the regularcontribution of partners, who are now over 500, the marketing is absolutely guaranteed,because the relevant procedures have advanced, we have 100% of buyers ready topurchase their promises to phase two and there is a waiting list for PHASE THREE no,that is there to go find customers for the sale of the properties of the project. As forprices, have government subsidies, are easily accessible to our partners, having toleave out several people under the high demand for housing of this nature and we areconcerned about setting a policy of prices.

TECHNICAL FEASIBILITY

The conventional design is the design work and construction of 561.27 square metershousing both in the phase 3 As in Phase 2 and is based on experience, where he hasgiven excellent results. We have ready the soil survey, topography and designs havebeen few changes in response to the law regulations.

We also have a human resource of great qualities that ensure effectiveness andefficiency of project

Among the technical factors were considered all relevant aspects:

1. The water supply and access to all public services.

2. The designs were developed and structured so that the housing units will have thebasic amenities and decent.


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3. The security of the area

4. Machinery and equipment used

5. Plant operational and administrative staff

6. Easy access to the centers of early childhood education, preschool, primaryelementary, middle, secondary and higher education different both in the municipality ofItagui as in neighboring municipalities, including the municipality of Medellin.

7. Infrastructure

8. Control and storage

9. Maintenance

ECONOMIC AND SOCIAL FINANCIAL FEASIBILITY

The social impact of the project is a priority matter. We seek to meet the human andspiritual needs of the communities especially our partners through social benefits andeconomic costs for them.

Drawing on the analysis in the presentation of the project, we observe that the variablesto consider are:

1. Number of meters to meters built daily, in this variable we consider:

a. The speed of construction

b. The number of hours worked each day

2. Progress in implementing a revised critical path interdisciplinary consistentlyaverages

3. Price of housing units and the Colombian state subsidies

Build cash flow independent of the Phase 2 and Phase 3 under the minimum of eachvariable so that was the best scenario.

Given the above it is concluded that the project is viable and profitable solid.

BACKGROUND OF THE COMPANY

The housing construction project VILLA QUINTANA PHASE 2 AND PHASE 3 will runon our ASOCIACIN MEJOR PORVENIR. Be supported by a group of professionals


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who will cover different aspects such as technical, legal, organizational, economic andfinancial.

Our legal representative Fernando Quintana Valds his life has been integrated into thecommunity, especially the most needy and low income in the municipality of Itagui.

So in 2007, in company with others in the same vocation formed the nonprofit entitythey called ASOCIACIN MEJOR PORVENIR initially helped its partners to improvehousing and subsequently under its management designed and built a housing projectbeneficiaries widely accepted and acclaimed by other partners who were coming to theAssociation for opportunities to access their own homes and have the possibility to paywith their modest economic resources.

Thus today ASOCIACIN MEJOR PORVENIR has been released as developer andbuilder of this ambitious project that will deliver 780 homes housing the same number offamilies.

Its partners are convinced of the form and manner of construction of their homes andparticipate actively in the various assemblies and special meetings as exercise partners.

Some of our partners have resided in the municipality of Itagui life and for some yearswithout prime in these no discrimination.

For 5 years we have been working with people in social support with a series ofprograms and projects with different objects.

DESCRIPTION OF THE OPERATION OF THE COMPANY

Main activity: Development and construction of housing programs of social interest.Secondary activities: Manage natural resources to different public and private entities,like to make available to the community an interdisciplinary group of professionals todevelop these benefits through from the discussion in the main activity.

NATURE OF BUSINESS AND INVESTMENT PROJECT

Vision

Being the first in 2015 in Antioquia Housing Association to change, improve andoptimize the way to build social housing with respect and protection of naturalresources, benefiting the people and communities in their quality of life, socialresponsibility and environmental commitment.


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Mission

Promoting, associate, design and build affordable housing effectively and efficiently,

with high standards of safety and preserving the environment by using resources tooperate profitably, while creating value for partners and investors and developmentopportunities for their workers and society.

OBJECTIVES

1. Consolidate as an organization builder to ensure the welfare housing for thecommunity to ensure social, environmental and economic.

2. Meeting the demand for housing solutions in the community directly or indirectlyrelated to the ASOCIACIN MEJOR PORVENIR direct and coordinate theinvestigations and studies required for the definition of strategies related to the sector,based on the identification, design, formulation and development of mechanisms,programs and tools necessary for the proper execution of the same.

3. Take advantage of the National Government, State and Municipal grants awardedunder the Act

POLICIESPolicy is ASOCIACIN MEJOR PORVENIR, the pursuit of business developmentassociated with the growth and development of their environment. Therefore, it carriesout programs of social development for people and communities, managing andexecuting, for several years, various plans and cross-housing projects and in the field ofhealth, education, training, sanitation, health care promotion and career development,allowing you to collaborate and encourage partners to better quality of life.

PROJECT JUSTIFICATION

Environment variables analyzed:

Political and Legal Variables: Government measures implemented for the developmentof construction industry especially social housing in the country have been developingrapidly. This is because today is fully aware of the potential and the need for our needypopulation with few economic resources.

The regulatory framework comes from our Constitution, the Statute of urban planningMunicipal Land Use Plan Itagui Township, and several environmental and planningrules that govern the matter and detailed in the Annexes to this document.

There is legislation on monopolies that is directly supervised by the Superintendency of


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Industry and Commerce that seeks to provide balance to the domestic and foreignentrepreneurs.

Our environmental protection laws are now very demanding, regulated and governed bythe Ministry of Environment and autonomous corporations and regional support

agencies.

Our country has a fiscal policy that has been developed in recent years and offers agenerous view to the development of domestic and foreign investment. In our project forsocial housing in the 2 phases are tax benefits for having the participation of the stateand because its construction is who runs an association

The labor law requires respect for workers and the fulfillment of obligations.The stability of the government throughout our history is a pledge of ensuring overallstability sponsoring a flattering future effective protection policies, tax policy, exportpromotion, promotion laws manpower training, technological research, between other

possibilities.

Our project is located in the domestic market (marketing), where our major clients areassociated with them needs to have an economical solution for housing where there arepreferential provisions for foreign funders (rebates, credit facilities and tax privileges,etc.).

MARKET ANALYSIS

Recipients and needs to satisfy:

End users are partners ASOCIACIN MEJOR PORVENIR, which have modest periodicpayments and debt capacity.

Penetration: Penetration Our estimates are guaranteed under the elements and detailsdescribed above, this target market, are fully ensured by the large and growing demand.Not enough local supply of housing units of this type.

The bargaining power of buyers.

Our potential customers (partners) are not competitive threats to our project becausethey do not have the power to force us to reduce prices, demand higher quality andbetter service.

Potential buyers (partners) can not change your provider, ie it is not easy to select oneof our competitors and allow our project due to insufficient supply of housing and limitedsuch projects


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The bargaining power of suppliers.

Our potential suppliers can not be regarded as a threat because they are not able to

impose the price we pay for inputs and machinery due to the large number ofalternatives to supply goods.

There is no threat because even though most providers are labor organizations, manydifferent sizes and tend not to integrate forward (ie, follow a step in the chain).

MARKETING MANAGEMENT (Marketing Plan)

Who are the buyers? The 180 families already selected (list of recipients who havealready given to you) and another 600 to be selected according to the criteria required

by law

How will you promote? No need to promote the relief because of the subsidies grantedby the State.

How are sales going to do? With the payment beneficiaries organized and subsidiesby the Government

7 - FUNDING OF INVESTMENTS MADE IN THE PERIOD OF INSTALLATION

PHASE 2 PREINVESTMENT

ASOCIACIN MEJOR PORVENIR, has made significant progress and in terms of theinvestment made which are summarized below:

Capital Expenditures and general construction costs

Land: We have a lot of land with an area of 56532.57 square feet, which has a marketvalue of U.S. 466,554.

The lot has been adequate to removal of land and currently has an excellent physicalcondition to begin preliminary construction work. Your situation or legal regime ofoccupation and ownership is duly legalized by public deed.

Credit should be a third part of U.S. 252,951. The value includes improvements made.Its location is in the race 55 No 69-98 Itagui - Antioquia - Colombia.

There have been matching jobs worth U.S. 120,000


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Building and Construction:

House was built office and warehouse to store materials for U.S. 70,000

Works for the safety of land U.S. 6.000

Administration: U.S. 32,000

Legal Documents: Valued at U.S. 70,000

Contingencies: Valued at U.S. 14,000

PREINVESTMENT TOTAL: U.S. 778,554

PHASE 3 PREINVESTMENT

Promise to Purchase Price: U.S. 960,000

8 - ECONOMIC ANALYSIS - FINANCIAL - Cash Flow

The purpose of this section is to provide basic information necessary to demonstratethat the proposed project is profitable for the Association and if external funding isrequired to demonstrate that you have the ability to successfully meet financial

commitments arising from the implementation and operation of the project.

CONSTRUCTION OF PHASE TWO (running)

FINANCIAL ANALYSIS

General evaluationPRODUCTION AND SALES YEAR ONE YEARYEAR LEVEL OF SALES USD $6.070821

SALES GROWTH 0%AVERAGE INFLATION 4%

FIXED INVESTMENT USD $3.541.315AMORTIZATION EXPENSES INCLUDED IN FIXED INV

WORKING CAPITAL REQUIRED USD $3.541.315PRODUCTION COSTS INCLUDED IN FIXED INVVARIABLE COSTS INCLUDED IN FIXED INV

FIXED COSTS INCLUDED IN FIXED INV

PROFITS TAXES

NOT APPLICABLE (NON

PROFIT)


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Cash flow

FLUJO DE CAJA AO 1 AO 2 AO 3 AO 4 AO 5

CAPACITY SALES 100,00% 100,00% 100%

SALES BUDGET

SALES US 1.742.551 US 1.967.396 US 786.958 US 786.958 US 786.958

PRODUCTION COSTS US 3.541.315 0 0

VARIABLE COSTS 0 0

_____________ _____________ ______________ ______________ _______________

CONTRIBUTION MARGIN US -1.798.764 US 1.967.396 US 786.958 US 786.958 US 786.958

FIXED COSTS 0 0 0

DEPRECIATION 0 0 0

AMORTIZATION DIFER C.T. 0 0 0

_____________ _____________ ______________ ______________ _______________

Operating Income US 1.798.764 US 1.967.396 US 786.958 US 786.958 US 786.958

LOAN INTEREST 0 0 0 0 0

_____________ _____________ ______________ ______________ _______________INCOME BEFORE US 1.798.764 US 1.967.396 US 786.958 US 786.958 US 786.958

TAX 0 0 0

_____________ _____________ ______________ ______________ _______________

NET INCOME US 1.798.764 US 1.967.396 US 786.958 US 786.958 US 786.958

DEPRECIATION 0 0 0

+ AMORTIZATION

LOAN AMORTIZATION

_____________ _____________ ______________ ____786.958___ US 786.958

OPERATIVE FLOW US 1.798.764 US 1.967.396 US 786.958

- INV ADICIONAL C.T. 0

_____________ _____________ ______________ ______________ _______________

OPERATIVE CASH FLOW US 1.798.764 US 1.967.396 US 786.958 US 786.958 US 786.958

======================= ============ ============ ============

SUMMARY OF REVENUE BY SOURCE SALES DETAIL MEANINGCONTRIBUTIONS OF GOVERNMENT INSTITUTIONS

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

TOWNSHIP USD 550.871GOVERNORATE USD 404.722

USD1.180.438

NATIONPARTNERSPAYMENTS USD 786.958 USD 786.958

USD786.958

USD786.958

USD786.958

YEAR INCOMEUSD

1.742.551USD

1.967.396USD

786.958USD

786.958USD

786.958

TOTAL

USD

6.070.821


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AMORTIZATION OF THECREDIT

CREDIT 4.000.000

DTF (INFLATION) 0,00%ADITIONAL ITEMS 4,04%TOTAL ANUAL RATE 4,04%TERM 5

PERIODS CAP INC CAPITAL INTEREST BALANCE1 USD 4000000,0 USD 800000,0 USD 161600,0 USD 3200000,02 USD 3200000,0 USD 800000,0 USD 129280,0 USD 2400000,03 USD 2400000,0 USD 800000,0 USD 96960,0 USD 1600000,04 USD 1600000,0 USD 800000,0 USD 64640,0 USD 800000,05 USD 800000,0 USD 800000,0 USD 32320,0 USD ,0

Financial indicators

PERIODCASHFLOW IRR 63%

0 4000000 NPV$

6.104.690,911 -17987642 1967396

3 7869584 7869585 786958

CONSTRUCTION OF THREE PHASE

FINANCIAL ANALYSIS

Investments to be made

- INVESTMENT FIXED - WORKING CAPITAL (EQUIPMENT, LABOR, SUPPLIESAND AMORTIZATION OF EDUCATION, INFRASTRUCTURE CONSTRUCTION:

U.S. 11,600,000

--OTHER OPERATING EXPENSES: U.S. 400,000

TOTAL: U.S. 12,000,000


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TYPE OF FUNDING

FINANCIAL RESOURCES (CREDIT) FOR FINANCING U.S. 12,000,000 of thecomplete work.

BASIC CASH FLOW EXPECTED TO FIVE YEARS

FLOW OF INCOME

HOLA DAVID, ACA PEGAS POR FAVOR LOS CUADROS EN EXCELL QUEADJUNTO EN EL OTRO CORREO. OJALA LES COLOQUES TITULOS COMO LOHICIMOS AYER, BUENO, MIL Y MIL GRACIAS

9 - CLOSING COMMENTS

This blueprint is for a vocation of social and community service permanent member ofour Housing Association better future.

Within our programs and projects constantly seek the elements of planning andplanning to implement this important project that aims to provide better quality of life in

1500 people with the support of the Colombian State.

We have the support necessary and sufficient to achieve our goals.Detailed information is subject to expansion and we are required to develop this projectin stages as necessary.

Sincerely,

Fernando QuintanaLegal representativeASOCIACIN MEJOR PORVENIR

Housing Construction Project of Social Interest Quintana Villa Phase and Phase No 2 No 3

Documents

Transcript of Housing Construction Project of Social Interest Quintana Villa Phase and Phase No 2 No 3