6. Evidenced capital cost estimates
6. Evidenced capital cost estimates
You need to research and present how much your project will cost. These figures will change as your project develops, but it is important to show that your early stage estimated costs are realistic as your funding applications will be based on them. Use a spreadsheet to show each cost, with a short explanation of how you arrived at each figure. Gather as much detail as you can for each cost line, using quotes and internet research. All this information may not need to be included in the application, but it will be invaluable if the funder comes back with questions, or later for claiming your grant.
You will also be expected to show a potential funding package at an early stage of the project. This needs to be based on your funding strategy and give a likely scenario for where the funding for the project will come from. It should be as realistic as possible and include local fundraising or borrowing if appropriate
Example cost table
Depending upon the project and funders, you are likely to be required to provide three quotes for capital items and works. For a small project, this could be done by researching the cost of play equipment online and by asking three local tradesmen for a price to fit the equipment for example.
Small Projects
A simple costs table may look something like this:
| Capital cost estimates (all costs inc VAT) | Capital inc VAT | Source |
|---|---|---|
| Groundworks (foundations and landscaping) | £20,000 | three quotes from local trades |
| Play equipment purchase | £15,000 | website links |
| Play equipment delivery | £1,000 | website link |
| Planning fee | £500 | Council link |
| Fitting play equipment | £2,500 | three quotes from local trades |
| Subtotal | £39,000 | |
| Contingency (usually 10-15%) | £3,900 | |
| Total capital costs | £42,900 |
Larger Capital Projects
larger project will require a clear specification for construction and a full tender process. The first step would be to tender for an architect, so your project would need to be phased to fundraise for and appoint the architect in the first instance. Once appointed, the architect would then develop the clear tender brief and Quantity Surveyor (QS) estimates for the construction work, which would in turn be tendered to secure three quotes from construction companies. This process is laid out in the project plan in section 4 above.
You need to be clear whether costs include VAT or not, and the VAT status of your organisation must be stated. For capital projects, independent VAT advice will be needed to establish what VAT can potentially be reclaimed. You will also need to allow for professional fees and contingency once you have an initial capital cost for the work from a construction company.
An early-stage capital costs table for a larger capital project may look something like this:
| Capital cost (provided by Architect and QS) | Cost | VAT | Source |
|---|---|---|---|
| Capital works - prelims | £50,000 | £10,000 | QS |
| Capital works - groundworks | £200,000 | £40,000 | QS |
| Capital works - construction | £750,000 | £150,000 | QS |
| Services | £30,000 | £6,000 | QS |
| Planning | £2,000 | £400 | Council |
| Building Warrant | £1,500 | £300 | Council |
| Professional fees (architect and QS RIBA 3 onwards) | £80,000 | £16,000 | Architect |
| Subtotal | £1,113,500 | £222,700 | |
| Contingency-10% | £111,350 | £22,270 | |
| Total | £1,224,850 | £244,970 |
For funders, the more detail and evidence you can provide around costs the more credible your project will be. QS estimates are appropriate for initial capital funding applications. All capital costs would then be updated once three construction tenders were received against the full specification for the build.
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