The creation of the plant wooden housing construction technology CMA + RNU

Project description

The aim of the Project is to create a new production of sets of wooden houses made in the factory using the technology of the CMA + RNE. The plant is of wooden construction with the capacity of 300 homes a year it is planned to create in the town of Dobryanka in Perm region (60 km from Perm).

Implementation of the Project and its operator

For the Project opened a new legal entity in the legal form "limited liability company "Forest Alliance" with 100% share of the Project Proponent. OOO "FOREST ALLIANCE" was registered in April 2017. The investor of the Project can act as a borrower or maybe a co-founder of the company, a combination of these options.

The relevance of the Project and market analysis

According to the targets of the national Priority program (pup) "Affordable and comfortable housing..." the volume of housing construction in Russia is expected to double every 10 years, starting in 2000. To achieve these targets the Government is taking a number of measures of the state support of wooden construction. Wooden houses, in addition to environmental features lightness, bystrovozvodimogo, seismic resistance, good thermal conductivity, strength and, importantly, profitability. The last property is very important, because the resettlement of emergency and dilapidated housing at the expense of budgetary funds. Despite the economic crisis, high rates of growth of wooden housing construction continue, and the share of wooden construction in total housing construction over the past 5 years has increased by 1, 6 times.

The limiting factor in further expansion of wooden housing construction is the lack of building capacity, ensuring the construction of a comfortable and relatively expensive wooden housing. Thus, the creation of factory of wooden housing construction in the Perm region is very important and necessary.

The Initiator Of The Project

LLC "Dobriansky timber-processing plant"

● LLC "Dobriansky timber-processing plant" was established in 2004. Currently it is one of the founder – the physical person;

● the company has a long-term rent (for 49 years) forest Fund area of 32 thousand Hectares with a total annual permitted felling volume is about 70 thousand cubic meters worth 730 million rubles in 2008 prices according to the independent appraiser. This asset may be used as collateral;

● Annual turnover of LLC "Dobriansky LPK" made in 2015 – 170, 1 million RUB (2, 5 million euros), 2016 – 180 million rubles (2, 6 million euros).

● over the years, the company has developed business plans for several projects in the Perm region, connected with the woodworking was also developed project documentation for a Complex Project "Establishment of Dobrianka forestry zone" in the town Dobryanka (60 km from Perm) Perm region and the establishment of several different woodworking industries. This documentation is passed, public hearings and received a positive conclusion of state ecological expertise and permission for construction;

● The project "Creation of Dobrianka timber zone" enjoys the support of the government of Perm Krai. It is included in the Federal state Program "Strategy of development of the forest complex of the Russian Federation for the period till 2020", approved by order of the government of the Russian Federation of 30 October 2008 №248/482.

Brief description of the Project:

The project "Creation of factory of wooden housing construction technology CMA + RNU" for a capacity of 300 prefabricated houses to the year's most sell quickly because in the city of Dobryanka we have a complete production site with a production building area of 2, 4 thousand m2 with the entire infrastructure and, in addition, it is the most guaranteed terms of sale of finished products because of the preliminary contract of supply to the whole volume of production. Within 6 months the plant can be built and can start to generate profits.

The plant will produce wooden houses with a high degree of prefabrication technology with the CMA + RNE.

Assembling such a home on the building site are done within 2-3 days of panels manufactured in the factory. The house is environmentally friendly because of the bar slipping entirely of wood without the use of adhesives and any insulation. The main niche for this product – social housing, because houses with a total area of 100 m2 and the cost per square meter to 250 euros (average cost of square meters in the Perm Region – € 800).

Available today and in the future there will be a significant shortage of such products throughout the country and especially in the Urals and Western Siberia. Such houses may be in demand for luxury housing, because they have all the advantages of houses made of massive wood. The company regards this area as a strategic perspective for diversification of market risk. The project is ready for implementation, the distinguishing feature is that the maximum independence from suppliers because there is a private timber base. The estimated net profit of the company will be 2, 3 million euros in year 0, € 6 million in the year — accrual for depreciation, these funds and scheduled repayment of borrowed funds.

For more information: https://www.hundegger.de/ru/mashinostroenie/izdelija/proizvodstvennaja-linija-mhm.html?mobile=%271%27A%253D0

Investment in the Project

The total investment directly in the factory of wooden housing construction is 300 million rubles (5 million euros.)

The structure of investuoti:

— acquisition of the plant equipment (Hundegger) – 4, 2 million euros. (83%)

and repair work on site – 0, € 6 million (13%)

— working capital – 0, € 2 million (4%)

The Effectiveness Of The Project:

The total project cost of 5 million euros. The payback period is 2, 1 year, discounted payback period – 2, 6 years. The project is characterized by high efficiency and high reliability:

— net present value Project (NPV) – 7, 2 million Euro (discount rate – 0, 1)

— internal rate of return (IRR) – 83, 4%

— capitalization for 5 years (EVA) – 10, 3 million euros

These calculations are performed for the borrowed capital at the rate of Bank interest – 14% in ruble terms.

As collateral the borrowed funds in this Project can be considered:

A) the right to lease forest resources at $ 10, 5 million euros;

B) plant equipment for the sum of 4, 2 million euros;

C) purchased a building with the land plot in the amount of 0 3 million euros.

The project is ready for implementation, the business plan of the Project and the financial model are available. A distinctive feature of this Project is the ability to create a closed production process from logging to the final product, maximally independent from the actions of suppliers.

The evaluation of the Project carried out on the basis of the software use ALT-invest™ Sums 6.04and financial models PDDS.

Risk analysis.

The business plan of the Project, its financial model exists, the Project is ready for implementation, is not required nor any additional design documentation, you do not need expertise and any coordination with the authorities and authorized bodies.

The initiator of the Project evaluates all significant risks of the Project (investment, marketing, management, and the risk of false information) in this case either as missing, or the probability of their occurrence during the Project implementation is assessed as negligible.

Sincerely, V. I. Rogalenkov