What is the right decision? 1 or 2 coats, every 5..7..or 10 years…. Taken from a long-term planning perspective..What is the best approach to take with repainting a property. With a simple illustration will we show how informed decision-making & planning saves you money ( or conversely inflate you actual cost by up to 75%).

Illustration:

  • The ave cost the repaint R65/sqm
  • The cost ratios : Restoration/priming 50%, 1st coat 25%, 2nd coat 25%
  • Paint Life expectancy 1 coat 3 – 5 years / 2 coats 7 – 10 years
  • Wall size 1000sqm

Alternatives (best case scenario)

  1. 1 coat every 5 years cost  R48750 (65 x 1000sqm * 0.75)
    • Cost over 20 years R195000 (eac R9750)
  2. 2 coats every 7 years  cost 65000 (65 x 1000sqm )
    • Cost over 20 years 195000 (eac R9287)
  3. 2 coats every 10 years, with midterm spot renewal
    • Midterm Cost  R16250  (65*1000 * 25%)
    • Cost every 10 years R65000  (65*1000) (eac 8125)
    • Cost over 20 years R195000 ( (65000 *2) + (16250 * 4) )

WHAAAT  ..  the cost is the same  

EAC

EAC is the equivalent annual cost or Annual contribution (Cost/Expected Life) . That is the annual money that you have to accumulate in the reserve to fund the renewal.

With the illustration above was inflation not considered. To compare the alternatives i.t.o EAC will require that the 7 and 10 year option be adjusted for inflation and at an inflation rate of 6% will the EAC’s be more or less equal

Altering variables  renders the insight 

  • If the degradation levels is less than 25% over 5 years . The spot renewal reduce and the values favor a longer 10 cycle approach
  • If the degradation is more than 25% over 5 years then the costs leans to a shorter  7 year cycle approach
  • 2 coats every 5 years. A 1 coat approach is not recommended and many reasons can be tabled why not to do 1 coat…but in reality people are doing it. thus we include the consideration from a purely cost perspective.  Doing 2 coats inflate the cost by a whopping 75% to R260000 over 20 years

 

Conclusion

In the context of the need to manage properties via a LTMP, wherein accurate forecast must be made in advance, is it important to get it right. Getting it wrong not only implies higher costs, it degrades the planning and provision objectives which in itself is a major cost driver. Making the right informed decision is thus critical.

As far as the decision on paint works renewal, is the approach structure specific, meaning that for every structure it will be unique and primarily based on the degradation factor for the spesific property.

  • at normalized degradation is the 10 year cycle the most economical approach
  • At abnormal degradation levels are the shorter cycle the more appropriate approach.

 

Several other factors can and should be included to drive informed decision-making. for the purposes of this publication were only core cost  drivers used .

For more insight email us on plan@propertymd.co.za

 

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