Monday, November 26, 2007

Its the tower,

Guillermo recently invited me to revisit the plan to have the tower as part of the project. Without it, he pointed out, there was no problem getting under budget. He asked me if I was considering letting that feature go.

It was an easy answer, though perhaps ultimately an unworkable one: Until I know, for certain, that the lowest possible construction costs are still outside my bottom line, the tower must stay. Its the reason for the building project. Until I conceived that I could get the the view, I was content building the place myself with plans I would buy from Home Depot. I have the labor. I have the skills and friends who have done it. I can get a view of Olga's from anywhere on the property. But to see Guillones required a real professional. And once we had the professional, and estimated the budget, it was time to really build a dream, and not an outpost. The budget was derived from predicted future sales price, and the sales price has been estimated with a view. Thats it. The view is King. It drives the project, and the only way to get it, is that tower.

I am crossing everything that will cross that we will make that budget.

I will let you know when I know. Hope with me.

Monday, November 19, 2007

Still, the horse may talk...
Guillermo emailed me to let me know that he entered into discussions with one of the contractors and with structural engineers to get the price per square foot number lower. He claims that they were able to decrease that number significantly. The other moving variable in the equation $/m2 x m2, the m2 part, is also being altered. Guillermo is already preparing a reduced version of the plans, one that decreases the width of the indoor, outdoor gallery/throughway from 5 meters wide, to 3.5, or, for those of you fellow American hopelessly stuck on the standard system, from approximately 16 feet to appx 10 feet. Seems a little odd to decrease that part of the house, since it is nothing more than a wood deck really, but if it significantly reduces the price of building, then its on the table. Further, the paved driveway and the back pork are to be reduced. Alternative materials are being considered, including choosing a polished concrete floor instead of teak. A shame, but a change I am warming to. And I do love polished concrete...I am just concerned that I am the only one in the world who feels that way.

I will let you know what DatumZero is able to do.

and now...a gallery of polished conrete.

Tuesday, November 13, 2007

I have been a bad blogger. I neglected my lovely page here, though, to be fair, there was not much to report. Then there was something to report, but i was mired in temporary shock, then depression, anger, disbelief, acceptance...whatever those seven stages of grieving are supposed to be.

The source of my happy fun mood: The constructions bids came in.

Let me back up.

Way back in 2006, when this project evolved from a dream to a reality, I laid out my total possible budget for building. I reached this amount through researching building prices, researching home sales prices in Nosara, particularly in Section EE, and looking very very hard at my financial situation. I discussed this with my fearless financial advisor [Actually, he has a lot of fear, which is why I work with him. My own fear circuits are largely inactive, except when math is involved. But I digress. In the end, I estimated that I could afford 100k to build, with the understanding that a 5-10% budget variance was possible.

When I contacted architects, and held my interviews, I used the number of 85k for discussions. That was the number under which I held my discussion with DatumZero, and which I have used as my basis for saving for this project for the last many months. In fact, I refinanced my house, a decision based on the deteriorating US housing market and a 5 year ARM more than anything else, but paid to open an equity line. I did this because Guillermo and team had overcome a functional hurdle to the overall disposition of the property which included a radical variation from the original plan. The tower. At this point, I was awaiting bids, and expecting numbers in the 120k range.

Imagine my surprise when all three bids came in at 300k.

No, don't imagine it, see what that looks like:

Guillermo sent me a document with these bids and a lengthy discourse about the ramifications. he led in true Douglas Adams fashion with this message: Do Not Panic. But I panicked.
300k? Are you joking me? That number hardly even reflects the original number. I mean, what am I dealing with...the Bush administration?
A calmer reading of the D0 document showed thoughtful reductions in building to help lower costs. This included not paving the drive, removing the entry work, reducing the depth and the length of the gallery, and terraces. Still, even Guillermo's best back of a napkin alterations could only get us to 217k.
I want to be clear. I dont hold Guillermo or D0 at fault here. The pathetic dollar, the increase in labor costs and a raging commodities market are all at least at play. still, I cannot go forward with these numbers. Guillermo told me that he had a meeting with one of the contractors last week, reviewing options to decrease the cost. I followed up with Ari, to find our walking away point in this project. Its a dream, I dont want it to become a nightmare.
I have done some additional research to discover what value I could create in my home. I estimate that number at 490, based on a similar house in EE for sale. They also have a view of the water, a similar size plot, 3 beds, 2 bath, and an awkward property orientiation that requires elevation for a view. At that amount, minus the likely value of the naked land, building a home for 300k would reduce the value of my property. Even if it comes out even, I dont want to lock up every available piece of capital I have, with no return on it until I can rent it in 9 months or so, in one investement. I cannot do it. Its too much. We need to get to 120 or less to make this work.
Feedback, and condolensces are welcome.
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