”BREEZY HOMES” RESIDENTIAL BLOCKS OF 200 APARTMENTS
TUV PROVINCE, ZUUNMOD CITY
| “Breezy Homes” residential blocks of 200 apartments are planned to be built on four pieces of private land located in Zuunmod with a total size of 5000 м2, which were bought by Mr. Bat-Erdene for this construction project. |
| The planning of these residential blocks is consistent with the local authorities’ plan for housing development in the area. The partial and general planning of these blocks have been approved by the department for building and urban planning. |
| The design and construction drawings have been done by “Tsenkher Tukhum” LLC, approved by the general architect of the province, and passed the state expertise. One of the 10 blocks has been built and sold. |
| The building infrastructures including heating, electricity, water and sewers have been built for the apartments. |
| There are a warehouse, an office, a well and a 380V electricity outlet at the construction site. |
| The 10 blocks for 200 apartments are 5-storey buildings with steel-reinforced concrete carcass. They have a total floor area of 11,700 м2. |
| One and two-bedroom apartments of 38.22 м2, 41.07 м2 and 57.87 м2 have been planned and there are parking lots in the basement. |
BUSINESS PLAN
Executive Summary
Short-term goals of the project for which we are seeking funding are to build the remaining 180 apartments in Zuunmod, Mongolia and to rent them for the next 2 to 3 years.
In the long term, after the period of time mentioned above has elapsed, the apartments will be sold. The project will be expanded by either immediately buying surrounding lands with infrastructures already in place or waiting for the state to build infrastructures in the aerocity nearby, and then building more apartment blocks and houses for sale.
Description of Business
The construction of the apartments will take up to 24 months regardless of building one block or all 9 of them. We will hire a construction company/s for quick and ease of execution. The other, less expensive option is, also good for the long term growth, to build them with our construction company, Grand Structure LLC that has built the first block.
Market Analysis
Currently, the demand in Zuunmod for rental apartments is high and it is hard to find an apartment to rent. The demand will rise until the infrastructures for the aerocity and then, residential apartments are built there. The high demand is fuelled by the government activities of:
- building a bigger international airport named “Chinggis Khaan International Airport” near Zuunmod (within 10 kilometres), which was opened in 2021
- building an international logistics centre with a new railway line called “Bogdkhan Railway” so that no freight trains pass through the capital city, Ulaanbaatar, which is 45 kilometres away from Zuunmod – This project has started.
- building an aerocity next to the airport to accommodate the airport staff and people who will work in this area once the planned logistics centre, free economic zone, science park and industrial park have been built – The construction of infrastructures has started, but will take a couple of years.
- moving some government departments to the aerocity in an effort to decentralise the capital city – This is planned and waiting for the aerocity infrastructures to be built.
- encouraging people to move to the aerocity as well as to “Maidar City” (an eco city planned to be located next to Zuunmod) away from the pollution and congestion of the capital – The government has offered free land in the country, a higher salary and a lower mortgage rate to people who move out.
- moving the government building to Nomtyn Am (part of the Bogd Khan Mountain), which is just next to our building site – It is a recent development.
- building a mountain tunnel through the Bogd Khan Mountain to the government building next to our building site – It is also a recent development.
An average upper-middle class family has a flat in the capital and it is a trend now that they also want a house just outside the capital meaning that we should build houses next to the apartments, the location of which is ideal for both developments.
Competitive Analysis
At the moment, one or two companies are building apartment blocks of 10 to 20 apartments in Zuunmod. Expansion of their activities are very limited by the availability of land with infrastructures and will not happen until infrastructures are put in place by the state as part of the aerocity development. The state has secured all the lands surrounding the airport and the availability of land for construction will be a problem to them.
We bought 4 pieces of private land (53,820 square feet) in 2010 in anticipation of new airport and new city development. The land is located in the north of the town, a few streets away from the Bogd Khan Mountain. We have built the infrastructures for 10 blocks of 200 apartments called “Breezy Homes” and got all the permissions from the authorities. Since 2010, roads and more building infrastructures have been built around the land by the local government.
Organizational Management
If we go with hiring a construction company, we will have minimal staff: a construction engineer to oversee and an on-site security person.
Products or Services
Zuunmod is a provincial centre nearest to the capital. In fact, the capital city and Zuunmod are on different sides of the same mountain, The Bogd Khan Mountain – a state-protected mountain. Land and properties nearer to this mountain are more expensive and always in demand. The version at the north or capital side of the mountain is called “Zaisan” where wealthy people live. We would like the south side to be the same, but without pollution and congestion of the capital city if a few streets of traditional dwellings are bought and replaced by modern apartments and houses, which is consistent with the plan of the provincial government and they have already built the infrastructures.
If we could buy the lands just next to our apartments, there would be nothing, but just the Bogd Khan Mountain left next to our development site making it the most expensive and unique place in the area to reside. Other houses around the capital are too far away from everything, partially polluted and hard to reach because of poor road conditions, and steep and slippery at winter terrains whereas “Breezy Homes” is not a mile away from everything and a motorway as well as an A-road leads to it from the capital.
Marketing Plan
The target market, to a certain extent, includes people in Zuunmod who look for apartments to rent because an apartment is always a much better and always-sought-after choice than living in a ger, the traditional nomadic dwelling. The target market mostly comprises of an influx of people moving to and arriving to work in the area. In the long term, better and healthier-than-in-the-capital life seekers, and high-income earners will add to it.
Sales Plan
As soon as after constructing the apartments, we would like to rent them all. After a while, prices of real estate properties will go up and that is when we should start selling them if we want to.
Funding Details
The funding required for each of the blocks is approximately 500,000 US dollars and there are 9 blocks.
Financial Projections
The investor will get 50% of the profit and rent. We are open to any other proposals of cooperation. We will expand the project by investing in the surrounding lands by paying for them with apartments that have already been built – an apartment for the land of a block at half the cost of an apartment.
