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Financial Aspects of Building Development Revenue and Sales Forecast

A brief summary On a land area of 20,000 square metres, the development is comprised of two buildings that each have eight stories. It is anticipated that the Nett Lettable Area (NLA) would be 160,000 square metres, and the footprint of each individual structure will be about 5,000 square metres. Bars will be built on the rooftops of the building, while cafes and retail spaces will be housed on the ground level. It is anticipated that the inclusion of a social space inside the development would enhance its attractiveness, which may lead to increasing levels of pedestrian activity and an increase in the demand from renters.

Revenue Projections

Retail Spaces and Cafes (Ground Floor)

Total Area: 10,000 sqm (5,000 sqm per building)

Average Rent: $50 per sqm per month

Annual Revenue: 10,000 sqm * $50/sqm/month * 12 months = $6,000,000

Office Spaces (1st to 7th Floors)

Total Area: 140,000 sqm (70,000 sqm per building)

Average Rent: $40 per sqm per month

Annual Revenue: 140,000 sqm * $40/sqm/month * 12 months = $67,200,000

Rooftop Bars

Total Area: 2,000 sqm (1,000 sqm per building)

Average Rent: $60 per sqm per month

Annual Revenue: 2,000 sqm * $60/sqm/month * 12 months = $1,440,000

Total Annual Revenue: $74,640,000

Expense Projections

Construction Costs

Land Acquisition: $20,000,000

Construction (Per Sqm): $2,000

Total Construction Cost: 160,000 sqm * $2,000/sqm = $320,000,000

Operational Expenses (Annual)

Maintenance: $10 per sqm

Total Maintenance Cost: 160,000 sqm * $10/sqm = $1,600,000

Utilities and Services: $5 per sqm

Total Utilities and Services: 160,000 sqm * $5/sqm = $800,000

Staffing and Management: $2,000,000

Total Annual Operational Expenses: $4,400,000

Projected Profit and Loss Statement

Year	Revenue	Expenses	Profit/Loss
Year 1	$74,640,000	$4,400,000	$70,240,000
Year 2	$74,640,000	$4,400,000	$70,240,000
Year 3	$74,640,000	$4,400,000	$70,240,000
Year 4	$74,640,000	$4,400,000	$70,240,000
Year 5	$74,640,000	$4,400,000	$70,240,000

Projected Cash Flow Statement

Year	Cash Inflows	Cash Outflows	Net Cash Flow
Year 1	$74,640,000	$324,400,000	$(249,760,000)
Year 2	$74,640,000	$4,400,000	$70,240,000
Year 3	$74,640,000	$4,400,000	$70,240,000
Year 4	$74,640,000	$4,400,000	$70,240,000
Year 5	$74,640,000	$4,400,000	$70,240,000

Projected Balance Sheet

Assets	Year 1	Year 2	Year 3	Year 4	Year 5
Current Assets	$74,640,000	$144,880,000	$215,120,000	$285,360,000	$355,600,000
Fixed Assets	$320,000,000	$320,000,000	$320,000,000	$320,000,000	$320,000,000
Total Assets	$394,640,000	$464,880,000	$535,120,000	$605,360,000	$675,600,000
Liabilities	Year 1	Year 2	Year 3	Year 4	Year 5
Current Liabilities	$4,400,000	$4,400,000	$4,400,000	$4,400,000	$4,400,000
Long-term Debt	$320,000,000	$320,000,000	$320,000,000	$320,000,000	$320,000,000
Total Liabilities	$324,400,000	$324,400,000	$324,400,000	$324,400,000	$324,400,000

Equity	Year 1	Year 2	Year 3	Year 4	Year 5
Retained Earnings	$70,240,000	$140,480,000	$210,720,000	$280,960,000	$351,200,000
Total Equity	$70,240,000	$140,480,000	$210,720,000	$280,960,000	$351,200,000

With considerable revenue generating from retail, office spaces, and rooftop bars, as well as predictable operational expenses, the financial projections shown above illustrate that the development project in question is robust and profitable.