Economic Feasibility

The feasibility study is used to assess whether a proposed project should be undertaken. It assesses the feasibility in four areas:

1. Economic Feasibility

2. Technical Feasibility

3. Operational/Organizational Feasibility

4. Environmental Feasibility

Feasibility is the evaluation or analysis of the practicality of a business plan. It is critical when an entrepreneur launches a business plan to the investors. As they say, “If you fail to plan, you plan to fail.”

The feasibility study always comes first. It answers questions like “whether a proposed model is practical or profitable?” The feasibility report eases the investor in making decisions that can cost a fortune.

Feasibility studies are essential for any business development. It can permit a business to address where and how it will work. It distinguishes potential obstructions that may block its tasks and perceive the financing it should get to put the business in action 0. Feasibility studies can prompt showcasing methodologies that could help persuade investors or banks that are putting resources into a task or business in an accurate way.

A project is considered to satisfy market needs or needs in an opportune design. Different potential outcomes might be considered in the theoretical arranging stage, and the innovative and financial possibility of every elective will be surveyed and contrasted with select the most ideal project. The financing plans for the proposed choices should likewise be inspected, and the venture will be customized concerning the circumstance for its finish and accessible money streams. After the extent of the venture is characterized, the itemized designing plan will provide the diagram for development, and the complete quote will fill in as the gauge for cost control.

The foremost step in business planning is to choose the right project. This decision is very critical and will single-handedly affect the future outcome of the investment. A few critical factors must be considered before the project selection, which include the approach of the task, the types of assistance offered, target user, funding, job opportunity, accessibility of data and the prospects offered.

The following are the research sectors that are covered in the project:

· Education Sector.

· Entertainment Sector.

· Transportation Sector.

· Industrial Sector.

· Energy Sector.

· Healthcare Sector.

· Environmental Sector.

The following steps are considered in the project selection process:

1. Brain Storming.

2. Selection Criteria.

3. Weighted Evaluation.

Brainstorming is the best way to come up with a solution. A group of diverse people, i.e. the team members, note down the ideas, which leads to more ideas or solutions. This section does not reject ideas. All the collective ideas are filtered after a comprehensive brainstorming and are forwarded to the next stage. The following are the final ideas presented and their expected funding source(s) with their selection criteria:

1. Children Cancer Hospital.

2. Silicon Plant Production.

3. Housing Project using Green Building Technologies.

4. Battery Recycling.

5. Asphalt Recycling.

6. Recreation Center at the Eastern Province.

Children Cancer Hospital:

Basically, the idea is to build a new hospital for Children`s Cancer. It is a charity project which will be funded by public donation.

Silicon Plant production:

The idea focuses on industry project for the purpose of utilization of the sand and other natural resources in Abo-Hadryaha area to convert those resources into Silicon through long process. Silicon is a chemical material that is contributed to various aspects of manufacturing extensively semiconductor material, microelectronic industries, and energy sources technology.

Housing Project Using Green Building Technologies

The idea of the project is to design and construct a housing project utilizing some of the latest green building technologies. This will not only aid in achieving one of vision 2030 objectives, which is to increase the percentage of home ownership among Saudi citizens; however, it will also help in reducing the percentage of consumed primary energy and produced carbon dioxide by the building sector.

Battery Recycling:

Establishing small plant for recycling of Batteries in using carbon dioxide, Lithium, and other materials to remanufacture for Batteries and other source of energy technology.

Asphalt Recycling:

Establishing an asphalt plan to recycle the milled asphalt from streets, parking, and driveway. This asphalt will be repaved after some recycling work at the plant. As per many studies, the lifespan of the recycled asphalt is longer than the brand-new paved asphalt.

Recreation Center at the Eastern Province:

Recreation center is a place of entertainment which includes parks, sports, art, etc. A place for enjoyment and aspire in new professional way.

This is the section where the standards for the final selection are set. These standards are applied on the list of the projects which are filtered out in the previous section. The standards are shown below:

1. Access to the available data: It deals with the amount of data available, data quality, data provider, and the “ease of accessibility” to the information in the data.

2. Supply and Demand: Demand is significant for every market. Thus, the demand for the project under consideration is assessed in this part. It also evaluates whether there is sufficient supply for the demand.

3. Compliance with Government policies: The proposed project is checked whether it complies with governmental policies and plans or not.

4. Profitability: The profit that will be earned from the proposed plan is calculated.

5. Completion time: Everything needs time to complete. The amount of time required for the project completion and the timeline layout is decided here.

6. Funding Strategy: The proposed ideas require an exceptionally good source of funding for the highest chance of implementation.

7. Target User: Ideas target a certain group of people which in fact will make additional credit in the evaluation.

8. Environmental Impact: Environment plays a major role for the successfully of any business. So, it is an Important factor to consider when making the assessment such as water, atmosphere, and human-being.

9. Constructability: The ease of construction for the proposed project is evaluated.

The purpose of this process is to select a project from the previously identified list of projects. This can be attained by applying the following weighted evaluation techniques:

· Criteria scoring matrix: an evaluation between the selection criteria (Table 1).

· Analysis matrix: an evaluation between each project and selection criteria (Table 2).

Table 1: Criteria Scoring Matrix.

Table 2: Analysis Matrix.

The selected project is ‘’Housing Project using Green Building Technologies’’ based on the weighted evaluation results.

Chapter 2: Need Analysis (Supply and Demand)

In Saudi Arabia, the real estate sector has softened for the last five years. The government has increased its effort in ensuring that there is affordable housing, in addition to wider diversification plans focused on tourism and industrial output. With our aim of constructing a survey project to build 100 Villa-Green buildings in Saudi Arabia, we decided to construct a market survey just to ensure we came up with different pieces of information. This is to ensure we make the necessary conclusion on whether to commence on the project or not and if yes, how exactly are we going to approach the entire scenario.

These estimated growths are hopes for the 250 green villas that we are building because by the time we are done with them, the demand will be ready for them.

SAUDI ARABIA POPULATION GROWTH

 Since 2015 Saudi Arabia's population has been growing exponentially. This is from 31.56 million to 35.01 million in the year 2021. The population is projected to increase to 45.06 million by the year 2050.

It should be known that population is one of the demographic structures that affect housing. The increase in population in Saudi Arabia will definitely alter housing consumption. It should be known that the general population does change into effective housing demand. An increase in population stimulates the general housing consumption. This shows that 100 villa green will eventually find willing buyers and the project is going to be successful.

SAUDI ARABIA HOUSEHOLD PERCENTAGE SUPPLY &DEMAND

With the promising population of the housing sector, the government has plans to spend over $100 bn in housing when it comes to the year 2023 as it seeks to build 1m homes and increase the homeownership ratio. From 47% to 70% as a part of its vision 2030 strategy.

When it comes to Riyadh the residential market remains unchanged from the year 217 to 2018. It has been with 1.26million units in the market. However, demand for residential property is expected to be underpinned by a growing population. There are factors that are expected to inevitably fuel the demand for residential units in Riyadh. When it comes to the supply of Riyadh it has been rapid growth in the urban limits over the past five decades with the majority of development currently taking place beyond king Salman Road as the city is expected to expand.

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Similarly, Jeddah’s residential supply is also largely unchanged at 813,000 units, Dammam at 347,000, and Makkah with 384,000. Residential sales prices and rentals softened in 2017 and 2018, decreasing by 3% and 4%, respectively. However, in these three cities, the demand for housing will continue to be supported by a dynamic factor that is relating to population growth (Alharbi, 2020).

The average population growth was initial to grow by 2.5% which will mean that the demand for housing will increase by a significant margin. The supplies available and is being geared towards the middle-income economy. North Jeddah is seeing more development activities and further lifestyle will prompt. Across Jeddah, the general sale price of apartments has been supported by the shift from villas to the apartment which is not quite a good thing in relation to our project.

Table 1.1

This shows a population of around 9 million people is expected to rise. This is an indication on the how the company is going to solve various things as the population rises the 100 villas are expected to get clients.

EXPECTATION OF SUPPLY & DEMAND IN 2021

The Saudi government is expected to increase the target of the Sakani program. Which increases the percentage of the housing programs (Alharbi, 2020). The targets of the Sakai program in 2021 is to serve more than 220,000 Saudi Families and increase the percentage of housing ownership.

Sakani is a real estate initiative to support and enable Saudi citizens to own their first home. It very important for it is very important for beneficiaries to apply online. They could get instant approval.

 In a nutshell, demand and supply of ownership housing increased significantly with shown percentage and 100 villas will be built as green building design in eastern province. Eventually, real estate will pick up in general from current economic reforms under the national transformation plan.  Furthermore, Furthermore, it is expected that the planned wave of privatization will boost investment and foster growth in the business environment creating favorable conditions for villas.

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