LCC in Norway Experience and State of Art

Transkript

1 MULTICONSULT Multidiciplinary Consultants competent - creative - complete LCC in Norway Experience and State of Art Anne Kathrine Larssen M.Sc., Multiconsult AS office: , mob: akl@multiconsult.no Dato: Side: 1

2 Outline Experience in Norway Nordic LCC-Project LCC and SLA International approach Dato: Side: 2

3 Background M.Sc. Anne Kathrine Larssen 6 years in Multiconsult and several years with large public real estate owner and developer. Mainly working with: strategic analysis (asset-, property-, FM) Lifecycle cost/profit analysis (LCC/LCP), technical values, rent - principles and calculations KPI s and benchmarking functionality/usability and adaptability of buildings. Dato: Side: 3

4 The First Maintenance Law King Magnus the Lawmaker - In 1278: All farmers must tar their church every third winter The law defines: Who is responsible What to do How often Dato: Side: 4 Precautions to maximise life time: Material with high quality Detailed design for durability Skilled workmanship Knowledge of environmental impact Preventive maintenance

5 Historic milestones: 1988: Norwegian Standard NS 3454 Annual Costs for Buildings. Revised and extended in : Directorate of Public Construction and Property (DPCP): Calculation of MOM-cost in design phase 2001: New 6 in Legislation on Public Procurement LCC and environmental aspects shall be taken into consideration when planning a new construction 2004: Common Nordic LCC Classification System Dato: Side: 5

6 Our Life Cycle definitions Gap of expectation Building failure / - damage Quality / Function New demands -authorities -market -core business Sustainable construction Development upgrading CD 0 Replacement Possibility of influence Preventive Maintenance CD 1 Repair CD 2 Accumulated need for maintenance CD 3 Dato: Side: 6 Consept development Idé, Program Finish CD = Condition Degree (NS 3424) Ref.: S. Bjørberg Multiconsult AS

7 What is LCC? All the costs throughout a constructions life cycle Investment costs (capital) Management costs Operation costs Maintenance costs Development and upgrading costs Demolishment costs Additional costs Service and support Operations, energy & cleaning Management Maintenance & replacement Investment (capital cost) Development/ upgrading Dato: Side: 7

8 Some definitions Annual expence What you have to pay every year. Will differ from year to year Life Cycle Cost (LCC) Investment+annual expence+residual costs (demolition Lifetime Costs Net present value of LCC Annual Costs Annuity of lifetime costs Dato: Side: 8

9 NS 3454 The Model: Discount to net present value Investment (capital) cost Annual MOM costs Replacement and periodic maintenance costs Life Time Cost Annuity Cost Functional Lifetime Considder: Cost of action Intervals of action Real rate of return Lifetime of building Dato: Side: 9

10 Important to remember The lowest possible LCC is not an aim in itself, but the calculations should demonstrate the consequences of the choices made It should be a duty of the design / construction teams to set up LCC of the choices made, but it is the privilege of the owner to choose alternative. Dato: Side: 10

11 LCC or Annual Costs analysis is used: to prepare budgets for investment and MOM-costs (Management, Operating, Maintenance) throughout the planning and construction process to evaluate alternatives to estimate consequence cost of rebuilding, improvements or changing in operation or in other words to choose among alternatives, provide arguments, check profitability, provide budgets etc Dato: Side: 11

12 NS 3454, representing all the lifecycle costs 1 Capital cost 11 Project cost NS3453 -Mutual costs.1 -Building.2 -HVAC and plumbing.3 -Electricity.4 -Telephone, automation.5 -Other installations.6 -Outdoor.7 -General costs.8 -Sepecial costs.9 12 Residual cost (- or +) Dato: Side: 12 2 Management cost 21 Taxes 22 Insurance 23 Administration 3 Operation cost 31 Operation and minor maintenance 32 Cleaning services 33 Energy 34 Water and sewage 35 Refuse collection 36 Security 4 Maintenance cost 41 Regular maintenance 42 Replacements 5 Development cost 51 Current refurbishment 52 New demands 53 Upgrading 7 Service and support costs for the core activities 71 Administrative office management 72 Swichboard and receptionist services 73 Canteen and/or catering services 74 Furniture fixtures and fixings 75 Moving workplaces and/or job rotation 76 Telecommunications and IT-services 77 Postage and messenger services 78 Supplies and copying services 8 Potential of the property 81 Rebuilding 82 Additions/extentions # Suggestion of additional account: Interruption of operation Interruption of the core activities in the building caused by technical failure.

13 LCC in different phases Consept program Preliminary project Detailed project Constructi on Commiss ion Use Estimates of investments and MOMD Lifetime category Demands for adaptblility Environmental accounts MOMD on level 2 3 Environmental accounts (factor 4 og 10) Alternatives Visualise demands on adaptability Environmental demands (reuse etc.) Requirements for MOMD/FM in all contracts. Control of documentati on Alternatives demonstrate dby LCC calculations Service agreements and contracts Up to date documentat ion MOMD budgets Key indicators for deviations Key indicators Benchmarking Active adaptability Condition based operation and maintenanceh SLA KTI Early Phase planning Production to build Production of building Core business production Dato: Side: 13

14 Early stage key indicator / project calculation Cost Key indicator skr/m2 Projectcalculation kr/m2 Explanation of deviation 1 Mutual costs 2 Building 3 HVAC -inst Special geotechnical conditions. Adapt. Cost in structural sustem 4 El-inst. 5 Tele and automation 6 Other inst 7 Outdoor Dato: Side: 14 8 General 9 costs Special costs

15 Early stage key indicators MOMD(S) Cost Key indicator Ref. kr/m2 MOMD Calculation kr/m2 Explanation of deviation 1 Capital 2 Management 3 Operation 350,- 300,- Cleaning more exp. due to intensive use 4 Maintenance 100,- 120,- Solid materials, good design and craftmansship. High accessibility 5 Development 20,- 60,- High grade of adaptability 6 open 7 Service / support 8 Open Dato: Side: 15 9 Open

16 Early stage other factors Area Classification of functions demands for adaptability Norms per function Gross / net Liquidity Costs per function Income per production unit Rent Risk Define spread Identify major risks and how to minimize it. Dato: Side: 16

17 Production (design and construction) Lifetime and adaptablility Spesific demands that can be tested/measured afterwards. Availability for maintenace etc, 0-friction Alternative choises Documentation by LCC calculations The owner choose MOMD-budget Building structures/-parts is given an amount, unit price, lifetime/slp, frequences for maintenance/cleaning etc. Summated on 2-figure level according to NS 3454 Dato: Side: 17

18 Production closure Costs Projectcalculation kr/m2 Projectaccounts kr/m2 Explanation of deviation 1 Mutual costs 2 Building Special geotechnical conditions 3 HVAC -inst. 4 El-inst. 5 Tele and automation 6 Other inst 7 Outdoor 8 General costs 9 Special costs Dato: Side: 18

19 Occupation MOMD-budgets important for Planning of maintenance, cleaning and replacement etc. Key indicators and benchmarking Deviations Documentation is important for What is planned regarding adaptability Effective OM Planning of actions Dato: Side: 19

20 Example: New Rikshospital Estimate Estimate Detailed analysis of Calculation June Level 1 Level 2 RH s accounts jul.90 Project documen Statsbygg corrected jan.90 jun.90 MC HD Level 3 estimate calculation 2 Management Taxes etc Insurance 23 Administration 9 3 Operation Drift og ettersyn Cleaning Energy Maintenance Running Periodic Replacements Sum MOM Dato: Side: 20

21 Example Rikshospitalet interstitial floor IF Main IF Main Installation of technical systems goes parallell with the works in main floors without any conflicts Investments costs MOMD-costs Mutural ~ Management ~ Building + Operation HVAC - Daily operatation - Electricity + Energy + Telephone, autom ~ Cleaning ~ Other installations ~ Maintenance - Developement -- Totalt Dato: Side: 21 + Totalt -

22 The different economic systems Development MOM Capital 10 % 10 % 10 % rent 100 % 10 % 1 % 0,5 % 0,05 % Concept Total Constr. LCC Core design design costs business Dato: Side: 22

23 Dato: Side: 23 Total LCC (C+MOMD) (Example: school) Period 30 years Interest 5 % Alternative 1 Alternative 2 Alternative 3 Area Existing capital costs Capital costs of new investment Total capital costs Management Operation Maintenance Development Total MOMD costs Total LCC (annuity) Total LCC (net present value)

24 Funksjonalitet Functionality Functionality LCC in combination with evaluated functionality and adaptability Bygget er levedyktig, men må Bygget er levedyktig. Kort levetid. Ikke egnet for Bygget er ikke levedyktig. Ikke tilpasses Tilpasninger til kjernevirksomheten. Dyrt å egnet for kjernevirksomheten. 3 kjernevirksomheten.tilpasning er kan enkelt foretaes. Dyrt å drifte. kjernevirksomheten er nødvendig, og kan forsvares økonomisk. Dyrt å drifte. drifte. Mindre tilpasninger kan forsvares økonomisk. Dyrt å drifte. Bør avhendes på kort sikt. Dårlig egnet for Dårlig egnet for Dårlig egnet for Bygget er ikke levedyktig. kjernevirksomheten. kjernevirksomheten. kjernevirksomheten. Dårlig egnet for 2 Forholdsvis dyrt å drifte. Tilpasninger kan enkelt foretaes. Forholdsvis dyrt å drifte. Tilpasninger kan forsvares økonomisk. Forholdsvis dyrt å drifte. Mindre tilpasninger kan forsvares økonomisk. kjernevirksomheten. Forholdsvis dyrt å drifte. Bør avhendes - lengre sikt. Bygget egner seg for kjernevirksomheten. Normale Bygget egner seg for kjernevirksomheten. Normale Alternative 1 LCC (AC): Bygget egner seg for 1640 NOK/m2 kjernevirksomheten. Normale Bygget egner seg for kjernevirksomheten. Normale 1 driftskostnader. Bygget er meget levedyktig. Egner seg meget godt for driftskostnader. Tilpasninger kan forsvares økonomisk. Alternative 2 LCC (AC): 1860 NOK/m2 Bygget egner seg meget godt for kjernevirksomheten. driftskostnader. Mindre tilpasninger kan forsvares økonomisk. Kort levetid. Bygget egner seg meget godt for kjernevirksomheten. Mindre driftskostnader. Kostbart å tilpasse til ny bruk. Kort levetid. Bygget egner seg meget godt for kjernevirksomheten. Lave 0 kjernevirksomheten og kan lett tilpasses Alternative nye funksjoner 3 og virksomheter. LCC (AC): God inntjening nå og i fremtiden NOK/m2 Fremtidige tilpasninger kan forsvares økonomisk. tilpasninger kan forsvares økonomisk. driftskostnader. Kostbart å tilpasse til ny bruk. Kort levetid Adaptability Dato: Side: 24 Multiconsult

25 Differ from alt 1 in LCC Differ from alt 1 when estimated value of adaptability Higher cost in percent of alt 1 What will it demand for improved core business (assumed core business costs is 10 times space cost) 30% 13% ~7% ~10% = 0,7% = 1,0% Dato: Side: 25 Alt 1 Alt 2 Alt 3

26 Example of alternative calculation Wood window Invest: NOK Service life: 30 years Maintenance: 500 NOK/10y Aluminium window Invest: NOK Service life: > 60 Y Maintenance: 500 NOK/30Y Net present value: NOK ( 60 years, interest: 5 %) Net present value NOK Dato: Side: 26

27 Example Alt. 1 Timber frame wall with wooden cladding Alt. 2 Timber frame wall with facing of brick Alt. 3 Painted elements Project cost 1050 kr/m kr/m kr/m2 Lifetime 60 years 60 years 60 years Assumptions Planned maintenance Cleaning and painting Cleaning and minor repairs Cleaning and painting Maintenance cost 310 kr/m2 (scaffold, cleaning, painting) 60 kr/m2 (lift, cleaning) 260 kr/m2 (scaffold, cleaning, painting) Interval of maintenance every 6 year every 10 years every 20 years Service life period (interval between replacement of cladding) Residual value after 60 years 70% (replaced cladding after 50 years) 40% 40% Real rate of interest 5% 5% 5% Life time cost / share maintenance 1903 / 892 kr/m / 87 kr/m / 135 kr/m2 Annuity costs / share maintenance 101 / 47 kr/m2 per year 85 / 5 kr/m2 per year 98 / 7 kr/m2 per year Illustration kr Livssykluskostnader kr Livssykluskostnader kr Livssykluskostnader Calculation Investering kr Investering Årskostnader 60 Restverdi år Investering kr Årskostnader 60 Restverdi år Investering kr Årskostnader 60 Restverdi år Levetidskostnad Årskostnad Levetidskostnad Levetidskostnad Åårskostnad Årskostnad Dato: Side: 27

28 Two Nordic Projects on LCC Preliminary Project ( ) State of art in Nordic Countries and basis for further common main project Appr million m2 floor area in the Nordic Countries Appr. 27 million m2 additional floor area each year Main Project ( ) Nordic network Common Nordic classification system on LCC Establish active network within each country Input to international standardisation works Dato: Side: 28

29 Nordic Classification System Basis for the proposal Classification system shall be built on NS 3454 (from Norway), Danish FM, systematic in Sweden and Finland, and also NEN 2748 (from Netherlands). Each one of the main items has to be well defined at each cost level so that it is viewable and clear when discussed in order to determine what should be done. Each user (country) can then subdivide the different costs on a two number level. The difference between maintenance and operations has to be well defined. Dato: Side: 29

30 Nordic Classification System Definition of Main Items 1. Capital all investments incl demolishing 2. Administration incl consultancy, insurance etc 3. Operation daily, weekly and monthly within yearly period 4. Maintenance activities in period of more than a year (planned, replacement) 5. Developing demands from core activities, authorities etc 6. Consumption energy, water, waste handling 7. Cleaning inside and outside 8. Service All non-building related activities for support core business Classification of cost Main items are subdivided Dato: Side: 30

31 Nordic Classification System Main principle for dividing into subcategories: One-figure level states a main item, ex: 6. CONSUMTION Two-figure level states a service, ex: 63. Waste handling Three-figure level states an activity, ex: 63.1 Internal transport Four-level figures states a resource, ex: Equipment Salary Dato: Side: 31

32 Nordic Classification System sub 1 Capital Costs Sum of project- and remaining costs 11 Project Costs Includes all investments up to the finished construction. It can be subdivided contractors costs (similar to enterprise costs), employee costs (fees, etc) and special costs (taxes, etc). It will be outlined that the contractor's costs can be divided into groups with the same rate of depreciation (see attachments). Land cost shall be included. If this is a yearly fixed fee then it should be calculated to net present value. 19 Remaining Costs Costs for elimination of construction at the end of its useful lifetime. This can also be the period of use. In some circumstances the remaining costs can be income. For example, the sale of the used construction materials for new projects or the whole building for new use. Dato: Side: 32

33 Nordic Classification System sub 2 Administration Costs 21 Taxes and Fees Property tax and other required official fees (and independent expenditures) even if the structure is not in use. 22 External Fees Includes external assistance fees to the management, f.ex. condition survey, legal assistance etc. 23 Administration and Management Salary to administrative employees. Also includes rent of space for the use of management department, documentation of the construction inclusive the management of data-based system for MOMD, the service desk, marketing, internal control, etc. 24 Insurance Includes fire and burglary. Also insurance for necessary building equipment to the management department. Casualty insurance and personal property of user is not included under this insurance. 29 Various Example equipment for operation department Dato: Side: 33

34 Value of the Nordic LCC Project increased knowledge and competence on LCC as a consequence of increasing demand on service life planning Implementation of a common Nordic model and classification system within LCC ISO Service Life Planning Part 5 Life Cycle Costs CEN TC 348 Facility Mannagement establishing national network with response to arrange workshops for increasing competence in the industry Have direct contact to universities and research institutes Dato: Side: 34

35 Activities in national network after main project Responsibility given to an organization Consulting architects organization? ( Norway: RIF) Facility Management organization? (Norway: NBEF) Main activities Implementation, documentation, seminars etc Further development in connection with ISO / CEN Active in further Nordic project linked to LCC Building failures Service life discussions Dato: Side: 35

36 LCC and SLA 6. CONSUMTION 63. Waste handling 63.1 Internal transport Equipment Salary Level SLA unit Description of content activities to fulfill SLA resources needed for acticities Dato: Side: 36

37 Systematize classification Hovedpost Tjeneste Aktivitet Beskrivelse 1 Kapital 11 Prosjektkostnad Restkostnad 2 Forvaltning 21 Skatter og avgifter 22 Honorar til eksterne 23 Adm. og ledelse 23.1 Strategisk arbeid på porteføljenivå Prosesser med mål og strategier Arbeid med finansiering av virksomheten 23.2 Strategisk arbeid på eiendom/byggnivå Eie/leie vurderinger 23.3 Taktisk arbeid på pørteføljenivå Oppdatering av eiendomsregister, FDV-system og digitale tegninger Holde kontroll med gjeldende lover og regler Arbeid med forretningsplaner inkl. miljøpolicy Arbeid med budsjetter Overvåke eiendomsmarkedet Utarbeide styringsdokumenter Identifisering av prosjekter 23.4 Taktisk arbeid på eiendom/byggnivå Holde kontroll med gjeldende servitutter, heftelser, klausuler, reguleringsbestemmelser, utbyggingsavtaler, mv. Verdivurderinger basert på tilstandsvurderinger 23.5 Utleie All kontakt med leietakere inkl. markedsføring 23.6 Innleie All kontakt med utleiere 23.7 Regnskap For hele eiendomsvirksomheten Øvrige kontorfunksjoner 24 Forsikringer 29 Diverse 3 Drift 31 Drift og ettersyn utført av eksterne 32 Drift og ettersyn utført av egne ansatte 32.1 Planlegging Tilstandsvurderinger Drift -og vedlikeholdsplanlegging Budsjettering Dato: Side: Utendørs egne ansatte 38 Drifts-/tilsynsavtaler for utendørstjenester 39 Diverse 4 Vedlikehold 41 Periodisk utvendig vedlikehold 42 Periodisk innvendig vedlikehold 43 Utskiftning utvendig 44 Utskiftning innvendig 45 Aktuelle reparasjoner utvendig 46 Aktuelle reparasjoner innvendig 49 Utendørs 32.2 Administrasjon Innkjøp av eksterne tjenester Rapportering til myndigheter inkl. brann og internkontroll Oppfølging av miljøpolicy Ajourhold av dokumentasjon inkl. strukturering Regnskap Rapportering til ledelsen Avregning felleskostnader 32.3 Drift av bygg Inkl. intern avfallshåndtering 32.4 Drift av VVS-anlegg 32.5 Drift av elektro-anlegg 32.6

38 Activities Systemaize classification 3 Drift 31 Drift og ettersyn utført av eksterne 32 Drift og ettersyn utført av egne ansatte 32.1 Planlegging Tilstandsvurderinger Drift -og vedlikeholdsplanlegging Budsjettering Main cost item Operation Operation done by external Operarion done by own staff 32.2 Administrasjon Innkjøp av eksterne tjenester Rapportering til myndigheter inkl. brann og internkontroll Oppfølging av miljøpolicy Ajourhold av dokumentasjon inkl. strukturering Regnskap Rapportering til ledelsen Avregning felleskostnader 32.3 Drift av bygg Inkl. intern avfallshåndtering 32.4 Drift av VVS-anlegg 32.5 Drift av elektro-anlegg Descriptions Dato: Side: 38

39 International approach ISO Service Life Planning No classification Input given from LCC-Nordic Special input from Finland, supported from the other countries CEN 348 Draft pren Terms and definitions Draft pren Guidance on how to prepare FM agreements Dato: Side: 39

40 International approach European Commission 2003: Task Group 4: Life Cycle Costs in Construction 2005: LCC is a valuable contribution in Sustainable Construction 2005: Tender invitation for report on What kind of models are in use in the european contries? Suggestion on a common model for EU Guideline on how to use LCC in the value-chain The EU-model will be used as input to both ISO and CEN ongoing standardization work Dato: Side: 40

41 Computer aided tools A lot of self-made tools based on excel Alternative wall solutions and materials Free for use: LCProfit developed by DPCP Free for use, just download: 11 excel sheets for all the calculations and extraction of main key figures KPI Benchmarking Network (nfb) Members put their figures into the database Member data (organisation, sector, adress, contact etc Object data (building type, location, area, year of constr. Etc Consumption data (MOM-costs on sub-level, consumption etc Norwegian Facility Management (NfN) Activities simular to nfb, but Limited to members Dato: Side: 41

42 References Bjørberg, S. (2005). Life cycle costs in Norway Experience and State of Art. Oslo: Multiconsult. Bjørberg, S., Larsen, A. & Øiseth, H. (2003). Livscykluskostnader for bygninger. Oslo: RIF & Norges Bygg- og Eiendomsforening. Bjørberg, S., Kristiansen, B.F. & Larsen, A. (2005). Avskrivning av bygninger - Prinsipper og konsekvenser. Oslo: RIF & Norges Bygg- og Eiendomsforening. DFM. Public website, Erhvervs- og Boligstyrelsen (2003). Nøgletal for støttet boligbyggeri. København. Haugbølle, K. (2003). Life cycle economics: State-of-the-art in the Nordic countries. In: ILCDES 2003: Integrated Lifetime Engineering of Buildings and Civil Infrastructures. Proceedings of the 2 nd International Symposium, Kuopio, Finland, December 1-3, 2003 (pp ). Helsinki: ILCDES 2003 Secretariat. Bjørberg, S. & Haugbølle, K. (eds.) (2005). LCC for byggverk. Nordisk hovedprojekt slutrapport (SBi 2005:01). Hørsholm: Statens Byggeforskningsinstitut. Dato: Side: 42

43 References Haugbølle, K. & Hansen, E. J. de Place (2005). Advancing life cycle economics in the Nordic countries. I: Kähkonen, K. & Porkka, J. (ed.). Global Perspectives on Management and Economics in the AEC Sector. Helsinki: VTT & RIL, pp ISO (2002). ISO/DIS Buildings and constructed assets - Service life planning - Part 5: Whole life costing. Genève: International Organization for Standardisation. NEN 2748 (2001). Terms of facilities Classification and definition. Dutch Standard. Delft: Nederlands Normalisatie-instituut. NFB. Nettverket Nøkkeltall for benchmarking. Norges Bygg og Eiendomsforening (NBEF). NS 3454 (2000). Livscykluskostnader for byggverk Prinsipper og struktur, Norsk Standard, Oslo, 2nd Edition March TG4 (Oct. 2003). LCC in Construction. Final report. Bruxelles. Thorsnes T., Gundersen N. A., & Haugbølle Hansen K. (2001). LCC for byggverk. Rapport fra kartleggningsprosjektet i de fem nordiske land. Oslo: Nordisk Industrifond. Dato: Side: 43

44 Dato: Side: 44 Thank you for your attention