A Presentation www.epahome.com

Feasibility of Ultra Low Cost Housing in Private Sector

About the Promoter Mr. Paramjit Singh Sahai

Mr. Paramjit Sahai has a humble origin. Coming from a middle class army family background, he has travelled across the length and breadth of the country

during his school time. He studied 11 classes in 9 schools countrywide. It was during his journeys from one place to another that he started feeling that

connect with the lower middle class. As he sometimes excitingly recalls the way he used to wave hands at the poor farmers when he used to travel by train is a testimony to this trait of his. The sharp mind and strong analytical skills which he possesses is attributed to his stay at the leading engineering institute of the country, IIT DELHI. He has this uncanny ability to adjust in all kind of environments.

The concept of low cost housing first struck him in the year 1987 while he was visiting the library of NBO. In a country where millions of consumers earn between Rs100 to Rs 300 a day, this group forms a huge untapped market. It is his conviction that providing affordable low cost houses to these people in a clean, hygienic locality would help fulfill dreams of these Low Income families of owning a house. He also considers it to be a part of his corporate social responsibility of bringing smile on the face of people with whom he has always and continues to feel an emotional connect.

In a family where everyone had been in service for ages, Mr. Sahai broke the convention by opening his own firm EPA INFRASTRUCTURE in 2003 which performs various specialist construction services. Now with low cost housing he wants to add another angle to his entrepreneur abilities and organization building capabilities thereby fulfilling a social cause and help millions realize their dream of owning a home.

He wishes to build this LCH Business on a pan India basis and expand it worldwide.

Opportunities in India

As per a report by Ministry of Housing and Poverty Alleviation, there is a shortage of approx. 25 million units in the country. 98% of this shortage belongs to the ultra low income segment.

Our present Target is to address the segment of population which earns 1.2 lakhs/annum to 2.4 lakhs/ annum.

Affordable Housing Housing is considered

affordable if a household pays no more than 30% of its gross income for all housing-related costs.

Our target income segment is 1.2-2.4 Lakhs.

The affordable unit cost for this segment is therefore 3.5 lakhs to 7.5 lakhs

Land feasibility

Land Cost should not be more than 50 lakhs/acre

Land should be in Government approved residential zone

Road/rail/metro connectivity to work places should be excellent

Complete Habitation Concept

Actual Users will come & stay Not for Investment Purpose Basic Amenities like English

Medium School, Health care facility, Mobile Market, Play

grounds Proximity to work Place (Not more

than 90 min travel time to work place) Cost effective technologies

Cost Effective Housing Methodology Aims to reduce the cost of construction and at the same time not

sacrifice any element of safety or serviceability of the house over the life cycle.

Cost reduction by- Optimization of land use Functional design of buildings Rationalization of specifications Optimum use of building materials Innovative construction materials and techniques

Innovative Construction Materials and Techniques

BUILDING MATERIALS Calcium Silicate Bricks Fly ash–Lime Bricks Clay–Fly ash Bricks Clay Flooring Tiles MCR Roofing Tiles Burnt Clay Flat Terracing

Tiles Fibrous Gypsum Plaster

Boards

BUILDING TECHNOLOGIES• Precast Channel Unit for Flooring/Roofing• Precast Reinforced Concrete Joist & Plank system for Flooring/Roofing• Thin R.C. Ribbed Slab for Floors and Roofs• Precast Concrete Waffle Units for Floors and Roofs• Prefabricated Reinforced Concrete Plans for Roofs• Precast Doubly–Curved Shell Units for Floors and Roofs• Precast Reinforced/Pre-stressed Concrete Ribbed or Cored Slab Units for Floors & Roofs• Reinforced Brick and Reinforced Brick Concrete Slabs for Floors and Roofs• Prefabricated Brick Panel for Floors/Roofs

Concept of Green Housing

Green House

A Green House is an outcome of a design which focuses on increasing the efficiency of resources — energy, water, and materials through better design, construction, operation, maintenance, and removal.

Water Conservation Low Environmental Impact Economic performance Low Cost Sanitation

Green House – Water Conservation

•  Collect rainwater for external use i.e. garden/washing car.

• Use water conserving appliances including toilets, shower, taps, washing machine and dish washer  e.g. Low flow faucets, water saving dual flush tanks .

• Reduce irrigation and surface water run-off

Green House – Low Environmental Impact Include water permeable landscape features. Enhance native bush and create edible gardens. Establish home recycling bins and garden composting.

Green House – Economic Performance Use local resources, skills, labor, crafts and art.

Strive for a balance between ecological integrity and economic viability. Consider local facilities and utilities.

Consider maintenance of the space plus initial 'running costs' pay-back period .

CASE STUDY SULABH INTERNATIONAL

LOW COST SANITATION

Sulabh International An Indian based social service organization founded by Dr.

Bindeshwar Pathak in 1970 It works to promote human rights, environmental sanitation, non-

conventional sources of energy, waste management and social reforms through education.

World Largest Sulabh Complex

Sulabh Technologies & Benefits Eco-friendly Twin-pit Compost Pour Flush Toilet Technology

(Sulabh Shauchalaya ): Simple, inexpensive in construction and operation. Flushing requires 1.5 – 2.00 litres of water as compared with 10 to 15 litres

required in conventional toilets. Moreover, the system is never out of commission because there are two pits

- one is used at a time and other kept as a standby.

Bio-Gas Plant in Public Toilets, Housing Colonies and High-Rise Buildings. Simple technology, No chemical is required and no energy is put into use for

its functioning. Bio-degradation of human excreta, produces biogas to be used in burning

lamps, warming bodies, cooking and for being converted into energy to be used for lighting street lights and such other uses.

The sludge at the bottom of the digester can be used as fertilizer which minimizes the use of chemical fertilizers.

Low Cost HousingAcross the Globe

LCH in Brazil

Betum, Brazil Project run by the  ICLEI and supported by local and central

government including Brazil’s Ministry of the Environment, as well as the British Foreign and Commonwealth Office (FCO).

Energy consumption – reduced by 40% due to solar panels being installed on nearly 1,500 new low cost houses in the city, a project supported by the FCO.

Use of solar energy greatly saves electricity.

Success has so encouraged the town council that they have done a deal with a major transport company to run all public buses on a percentage of biodiesel.

This, says ICLEI, has inspired other Brazilian cities such as Sao

Paulo, Porto Alegre, Belo Horizonte and others to improve their approach to energy.

Matheran Realty coming up with low-cost housing project near Mumbai

15,000 flats-300 to 500 sq. ft. at 3-5 lacs at

Karjat, near Mumbai. Received over 40,000 calls for booking. Tied up with Sterling Construction systems for

cost-effective building system that does away

with brick and plaster Use of prefabricated fiber boards. These boards ensure a plaster-free finish Also provision for inbuilt ducts for power and water supply, saving

considerable time and manpower cost. Cost savings Upto 30% and 3000 sq. ft. could be erected in only 7 weeks

Low cost housing at Newtown Kolkata

20,000 apartments on 150 acres

by 2010. Estimated cost-1200 cr. With 12000 1bhk and rest 2bhk. Apartment size – 400 to 600 sq. ft. Most of the flats will have balconies

overlooking open green spaces. Establishment of support infrastructure such as two primary

schools, a mini-hospital, and a shopping Market.

CASE STUDY

Details of Units PlannedTotal Plot Area considered=20 acresTotal No. of Units Planned=1242

TYPE A - 1 Small Room Kitchen Super Area= 283 Sq. Ft. No. of Units=108

TYPE B - 1 Large Room Kitchen Super Area= 360 Sq. Ft. No. of Units=474

TYPE C – 1 Bedroom, Hall, Kitchen Super Area= 465 Sq. Ft. No. of Units=660

Revenue GenerationTYPE A – 108 Units of 1 Small Room Kitchen - 283 Sq. Ft. @ 3.9

lakhs

Duration (months) Amount(Rs.)

Cumulative Amount(Rs.)

TOTAL FOR 108 UNITS

On application 0 10,000.00 10,000.00 10,80,000.00

Allotment letter (within 15 days) 1.5 29,054.00 39,054.00 42,17,832.00

Instalment I 4 47,412.00 86,466.00 93,38,328.00

Instalment II 7 47,412.00 1,33,878.00 1,44,58,824.00

Instalment III 10 47,412.00 1,81,290.00 1,95,79,320.00

Instalment IV 13 47,412.00 2,28,702.00 2,46,99,816.00

Instalment V 16 47,412.00 2,76,114.00 2,98,20,312.00

Instalment VI 19 47,412.00 3,23,526.00 3,49,40,808.00

Installment VII 22 47,490.00 3,71,016.00 4,00,69,728.00On Possession 24 19,527.00 3,90,543.00 4,21,78,644.00

Revenue Generation

Duration (months) Amount(Rs.)

Cumulative Amount(Rs.)

TOTAL FOR 474 UNITS

On application 0 10,000.00 10,000.00 47,40,000.00Allotment letter (within 15 days) 1.5 40,400.00 50,400.00 2,38,89,600.00

Instalment I 4 61,186.00 1,11,586.00 5,28,91,764.00

Instalment II 7 61,186.00 1,72,772.00 8,18,93,928.00

Instalment III 10 61,186.00 2,33,958.00 11,08,96,092.00

Instalment IV 13 61,186.00 2,95,144.00 13,98,98,256.00

Instalment V 16 61,186.00 3,56,330.00 16,89,00,420.00

Instalment VI 19 61,186.00 4,17,516.00 19,79,02,584.00

Installment VII 22 61,286.00 4,78,802.00 22,69,52,148.00

On Possession 24 25,200.00 5,04,002.00 23,88,96,948.00

TYPE B – 474 Units of 1 Large Room Kitchen - 360 Sq. Ft. @ 5.0 lakhs

Revenue Generation

Duration (months) Amount(Rs.)

Cumulative Amount(Rs.)

TOTAL FOR 660 UNITS

On application 0 10,000.00 10,000.00 66,00,000.00

Allotment letter (within 15 days) 1.5 57,425.00 67,425.00 4,45,00,500.00

Instalment I 4 81,854.00 1,49,279.00 9,85,24,140.00

Instalment II 7 81,854.00 2,31,133.00 15,25,47,780.00

Instalment III 10 81,854.00 3,12,987.00 20,65,71,420.00

Instalment IV 13 81,854.00 3,94,841.00 26,05,95,060.00

Instalment V 16 81,854.00 4,76,695.00 31,46,18,700.00

Instalment VI 19 81,854.00 5,58,549.00 36,86,42,340.00

Installment VII 22 81,989.00 6,40,538.00 42,27,55,080.00

On Possession 24 33,713.00 6,74,251.00 44,50,05,660.00

TYPE C – 660 Units of 1 Bedroom, Hall, Kitchen - 465 Sq. Ft.@6.74 lakhs

Revenue Generation - Summary

TYPESales Revenue/Unit

(Rs) UNITSSales Revenue

(Rs)

A 3,90,543.00 108 4,21,78,644.00

B 5,04,002.00 474 23,88,96,948.00

C 6,74,251.00 660 44,50,05,660.00

TOTAL SALES REVENUE 72,60,81,252.00

Total Sales Revenue= 72.6 Crore approx.

Estimated Cost of Construction Construction cost considered is Rs. 690* per Sq.ft.

Estimated Development Cost = 10 lakhs/acre Total development cost for 20 acres = 2.00 crores Total Cost (Construction + Development) = 37.1 croresNotes -

* Construction cost includes architect and consultant fees

TYPESUPER

AREA(sq. ft.) COST/UNIT (in Rs) UNITSCONSTRUCTION COST (in Rs.)

A 283 195270 108 2,10,89,160.00

B 360 248400 474 11,77,41,600.00

C 465 320850 660 21,17,61,000.00TOTAL CONSTRUCTION COST 35,05,91,760.00

Outright Land Purchase.

EPA brings in Investors and develops Township.

BUSINESS MODEL 1

Procedure

EPA Home will arrange purchase of the land Outright from the land owner and develop it with it’s funding partners.

EPA will provide the entire services for project development and sale with it’s associates/ partners.

The funding partners will reap benefits from the developments as shown in the next slide.

Benefits• Project Revenue = Rs. 72.6 cr

• Construction Cost + Dev. Cost = Rs. 37.1 cr

• Land Value @ Rs. 50 L/Acre = Rs.10.0 cr

• EDC and IDC = Rs. 1.0 cr

• Net Profit generated = Rs. 24.5 cr

• The profit would be shared among the funding partners. EPA would charge professional fee for it’s effort.

Landowner as Partner to Development, by giving land as equity. Development funded by funding agency.

BUSINESS MODEL 2

Procedure Landlord’s Equity is equivalent to the his/her present land value

We will bring in funding agencies for development of land

EPA will provide it’s expertise to develop the land and marketing efforts for sale of the houses

The profit would be shared among funding partners & Landowner in the ratio of their Equity/Efforts. EPA would be paid for it’s effort.

Benefits

Total Sales Revenue = Rs. 72.60 crore

Total Construction & Development Cost = Rs. 37.1 crore

EDC + IDC = Rs. 1.0 cr

Land Cost = Rs. 10.0 cr

Project Surplus = Rs. 24.50 crore

Profit Sharing ratio would be decided mutually.

Township Development for Landowner by EPA on Consultancy Model.

BUSINESS MODEL 3

Procedure The Land Title remains with landlord.

Landlord has NO out of pocket expenses except for ON-SITE ASSESSMENTS and Initial Fee.

EPA Home will need land as collateral. Landlord will retain full ownership of land.

The project would be carried involving top architects and consultants with green technologies.

This joint venture would results in the land owner receiving revenues many times the market land value along with other benefits.

Benefits

• Project Surplus = Rs 34.5 cr

• Fee to EPA Home (5% of Sale) = Rs 3.6 cr

• Net Profit generate = Rs 30.9 cr

Whereas plot cost was 10 cr. Land Owner earns 20.9 cr more by entrusting development to EPA Home. (These are illustrative values. Actual Values will be assessed after on-site assessment)

Potential Cities

India’s ten fastest growing Cities

SL No. City Growth Rate(%)

1 SURAT 11.5

2 BANGALORE 10.3

3 AHMEDABAD 10.1

4 MUMBAI 8.5

5 NEW DELHI 8.46 HYDERABAD 7.8

7 PUNE 7.4

8 BARDHAMAN 6.6

9 KOLKATA 6.3

10 CHENNAI 6.2

Other Potential cities are:

Thank YouEPA Home

A-2/7, Pink Apartments Sector 13, Rohini, New Delhi, India – 110085 +91-11-47068181 (4 Lines) +91-11- 27550895 Cell: +91-9811309097 Email : lch@epahome.com