This handbook covers know-how of building measurement, development cost and profitability for various asset classes – residential (apartments, villas & row-houses, plotted development), office & warehousing developments in Bengaluru.

In the real estate industry in India, varied definition for area is used for the purpose of planning, statutory approvals, execution of the project, and sales. It is important to understand what each of the area means, their applications and how they are inter linked.

This handbook explains definition, inter-relation, methodology to measure and statutory documents that verify FAR area, saleable area, built-up area, carpet area and unit built-up area, within Bengaluru Metropolitan Region (BMR). The data has been referenced using the applicable IS Codes, prevailing byelaws, and market practice.

Cost of a project can be categorized in to two major heads – land cost and development cost. Land cost is dependent on the prevailing market value and is proportionate to the development potential of the land. Development cost includes construction cost and other costs namely – cost towards development approvals, sales and marketing, administrative expenses, consultant fees, finance cost, overheads. The handbook provides detailed break-up of development cost and the cashflow workings for three different asset classes – residential, commercial, and warehousing. The development cost has been further compiled based on the development size, building height and project specifications. The report also captures variation in cost on account of technology used in the construction and procurement model engaged for the construction.

Various parameters applicable to arrive at the project profitability have been benchmarked for an apartment, villa, or a row-house, plotted development, office space and a warehouse. Project profitability has been computed based on the estimated equity infusion, gross margin, and Return on Equity (ROE) for two scenarios – self-development or Joint Development Agreement (JDA).

This handbook covers the following:

• Definition of FAR area, saleable area, built-up area, carpet area, and RERA carpet area
• Inter-relation between FAR area, saleable area, and built-up area for residential and a commercial development and method to measure these
• Development cost for an apartment basis project specifications - premium, luxury, mid-segment, and budget segment. Further, the cost has been computed for apartment up to 15 M height, 15 – M height and above M height.
• Development cost and Fit-out cost for Grade A and B warm shell and bare shell office space
• Development cost for a Grade A warehouse
• Initial equity, project profitability and Return on Equity (RoE) for an apartment, villa, office and a warehouse project

This handbook is prepared for benchmarking purpose and the information provided has been referenced using IS Codes (wherever applicable), prevalent market practice and our interactions with various stakeholders – developers, architects, property owners, investors, liaison personnel and construction or project managers, along with our own proprietary research.