LIFE CYCLE COSTING ON ENVIRONMENT-FRIENDLY BUILDINGS

Abstract

In the construction industry, there seem to be a common misperception that environmentfriendly buildings require heavy capital investment with very little regard of the potential benefits that such buildings can bring to the owner and client in the long run. Thus, there is a need for a framework that the developers or contractors can use in the consideration of the total costs involved in constructing environment-friendly buildings against other competing alternatives, and can thus make well-informed decisions based on accurate cost information. The objectives of this study are to identify the factors affecting the client s decision to construct environment-friendly building, investigate the environmental requirements that the client consider and are useful to reduce the environmental impact from a life cycle perspective and lastly to develop a comprehensive LCC model which can be used for evaluating the decision whether or not to undertake the construction of an environmentfriendly building. The study was based on a case study on City Developments Limited (CDL). Through this case study, three key factors were identified that contributed to CDL decision in developing green buildings and they are corporate social responsibility, economic benefits and unique marketing strategy. The environmental requirements that CDL consider were closely linked to BCA Green Mark assessment system. From the case study, it is evident that there is a lack of a costing tool that properly accounts for all the costs associated with a green building. Hence, this study describes the formulation of a proposed life cycle costing model that considers all aspects of a building life cycle. The cost components identified are capital costs, operation costs, maintenance costs, environmental costs, salvage costs and replacement and alteration costs.