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CHIEF MICHAEL ADEKUNLE AJASIN AMUSEMENT PARK
FEASIBILITY/VIABILITY RESEARCH REPORT
INTRODUCTION
This feasibility and viability report of the propose chief Michael Adekunle Ajasin
Amusement park was researched and reported by the entire Estate management class 2011/2012
graduating set. The market survey was carried out in December 2012, with the aim of evaluating
the existing market for recreational facilities in the surrounding states. The state in focus is Ondo
state where the proposed amusement park will be sited but based on professional judgment of the
research groups, it was decided that the market demand will not only be expected from ondo
state and thus 3 other states were randomly selected based on their proximity to Ondo state and
these states are Oyo, Osun and Ekiti state.
AIM OF THE PROJECT
The aim of the Project is the preparation of feasibility research concerning the siting of a
memorial amusement park named after Chief Michael Adekunle Ajasin in Ondo state. The
feasibility report or study should evaluate the forecast of cost and revenue. The cashflow analysis
should give an estimate of how long it will take for the project to pay-back the cost incurred in
its installment.
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SCOPE OF THE ASSIGNMENT
International cultural exchange Limited (INTERCEL) provides herein a report for the
Ondo state government of an estimate the potential market feasibility of the development of
Chief Michael Adekunle Ajasin Amusement Park, a proposed development which is not only to
serve as a center for recreation but as a memorial to retain the heritage of the Late sage. We
made a number of independent investigations and analyses in performing this study. We made
judgemental estimates concerning the subject site and its relationship to potential users as well as
its attributes relative to the amusement park and other recreational facility comparables. We
administered market survey questionnaires in 4 major states which are Ekiti, Oyo, Osun and
Ondo and the samples were taken randomly. We examined reports of various amusement park
developments including the major ones existing in these states which we could lay our hands
upon.
We researched information concerning the performance of each of the major components
of the project from the respondents perceptions. We interviewed representatives of area
attractions to determine usage and new supply additions. In conducting our investigation and
analysis, we relied on data retained in our office, which is updated regularly for use in all
assignments. Various agencies and databases, including the internet (Wikipedia.com) database,
were contacted for demographic data, land use policies and trends, growth estimates, and
employment data. Neighborhood data was supplemented by a physical inspection of the subject
property and the area. Cost estimates were based on professional quantity surveyors opinion of
cost as at 1996 and these values were appropriately adjusted considering the price change over
time. In addition to the subject's specific information, we have considered relevant market data in
determining the projections used in our cash flow analysis. The financial analysis was based
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primarily upon the probable operating experience of the property relative to gross operating
revenues, typical expense levels, and resultant net cash flow. Estimates of operating revenues
were based upon market data relative to industry standards and comparable properties in the
subject area. Expense levels were estimated based upon industry standards and operating
histories of similar properties.
Demographic factors
The survey was completed by 666 people. The study population was assumed to exclude minors
hence the figures from the market survey are targeted to include only age and income qualified
population which is assumed to start from age 18 and above. As seen in the table below, the
highest percentage of respondents was between 24-30 years (36.2% of the market survey). The
highest percentage of the respondents was single 52% in all and 24.8% of the respondents had
family sizes of 4 and 5 each.
Table 1: Age
Frequency Percent
18-23 162 24.324-30 241 36.2
31-40 144 21.6
41 above 117 17.6
Total 664 99.7
Table 2: Marital status
Frequency Percent
single 346 52.0
married 296 44.4widow 11 1.7
divorced 2 0.3
others 1 0.2
Total 658 98.80
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Figure 1: Market Capture description
Main Market areas
Competing Markets
The delineation of market zones above has not been done to any scale, its only descriptive
estimate to show the proximity of the other states understudied to ondo state. The Markets
understudied are the Recreation market In Ondo state, Ekiti state, Osun state and Oyo state. The
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main market is the proposed Chief Michael Adekunle Ajasin Amusement park which will be
located in ondo state as seen above.
Market Population Analysis
Consultants have adopted a three stage methodology for market demand assessment for the
proposed recreational facility at Ondo state. Demand for any activity is a resultant of several
factors, which are sources of generation of demand. Understanding of those factors is critical for
estimation of actual demand or demand generators. Firstly the indicators and factors are
described and illustrated. In the study, the catchment area for the proposed recreational facility is
delineated. The report presents a detailed analysis of the indicators and factors affecting the
demand for the proposed recreational hub with respect to the catchment area, with an objective
of estimation of the demand generating potential of these factors.
The Population:
First and most importantly is the population resident in an area, this is a major indicator of
market demand. The greater the population of an area, the greater the likelihood that demand will
be generated in the area. This however, is still subject to varying constraints which the analysis
of the market survey has been able to put into consideration in determining total expected market
demand.
2006, Nigeria Census figures show:
Ekiti = 2,398,357 people
Ondo = 3,346,087 people
Osun = 3,416,959 people
Oyo = 5,580,894 people
Others = an Estimate of 4,000,000 average
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The process for population analysis is in three steps which are described as follows:
1. Cross-tabulations, describing, the various percentages of each state or group of regions
who expressed willingness to visit the park were applied to the population from each
state. Assumption being that the market survey is evidence enough to serve as a basis of
generalization.
2. Weighted average of frequency of visits in a year: The total percentage of the respondents
who said they would visit always, sometimes, occasionally and never were weighted by a
probability of 0.4, 0.3, 0.2 and 0.1 respectively.
3. Market pull: In this step, the respondents where divided into 5 market areas, Ondo, Ekiti,
Osun, Oyo and Others. The percentage of the population who were attracted to the
competing recreational facilities were evaluated
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Table1: Population willing to visit the park
TotalTotal
yes&no Percentages
yes no12 2
1 0
1 0
1 028 4
4 0
1 00 1
1 0 7 12.28 no
Others 1 0 50 57 87.72 yes
65 923 1 10 9.71 no
Ondo 5 0 93 103 90.29 yes
1 01 3
1 0
1 0
1 01 1
91 2
9 0 6 5.31 no
Ekiti 1 0 107 113 94.69 yes2 0
4 01 0
1 0
65 9
8 27 0
1 0 11 10.89 no
Osun 1 0 90 101 89.11 yes1 0
1 01 0
28 3
1 0
1 089 4 7 5.30 no
Oyo 3 0 125 132 94.70 yes
466 41 522
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replies unaccounted
506 15
Table 2: Evaluation of respondents frequency of visits
Frequency of visits
TotalAlways% Sometimes% Occasionally% Never%
0 2 14 7
0gun 0 0 1 0
abuja 0 0 1 0
Anambra 0 0 0 1
benin 0 0 0 1
enugu 0 0 1 0
Kaduna 0 0 1 0
lagos 1 3 24 12Lagos 0 1 4 5
Lagos st 0 0 1 0
Minna 0 0 1 0
Niger 0 0 0 1
ogun 0 0 0 1
Ogun 0 0 0 1
Others Totals 1 6 48 29 84
Percentage 1.190 7.143 57.143 34.524
ado 0 3 1 0
ado ekit 0 0 1 0
Ado Ekit 0 0 1 0Ado-Ekit 0 2 0 0
Ikere 0 0 1 0
ekiti 4 30 55 20
Ekiti 0 1 7 2
Ekiti st 0 1 1 2
Oworo ek 0 0 1 0
Ekiti Total 4 37 68 24 133
Percentage 3.008 27.820 51.128 18.045
iabdan 0 0 1 0
ibadan 1 9 19 9
iibadan 0 0 0 1ikire 0 1 5 1
0y0 0 0 1 0
1badan 0 0 1 0
kwara 0 0 0 1
Kwara 0 0 0 1
owo 0 1 0 0
oyo 3 29 52 17
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Oyo 1 0 3 1
Oyo Total
Percentage
5
3.165
40
25.316
82
51.899
31
19.620
158
ife 0 0 2 0
Ejigbo 1 0 0 00sun 0 0 1 0ilesa 0 0 0 1
Iresi 0 0 0 1osun 7 14 50 22
Osun 0 3 7 0
osogbo 0 0 4 1Osun Total
Percentage
8
7.018
17
14.912
64
56.140
25
21.930
114
akure 0 2 5 1
ondo 3 16 48 44
Ondo 0 5 16 7Ondo Total 3 23 69 52 147
2.04021
15.646123
46.939331
35.374161 638
Source: Market Survey, 2013.
Competing
Facilities
Market population
attracted Percent of market pulled(%)Akure 12 1.802
Abuja 9
Delta 4
Lagos 64
North 1418
Others 109 16.366
Ibadan 108 16.216
Ekiti 36 5.405
None 391 58.709
Osun 10 1.502
Captured market(%) Uncaptured Market(%)
41.291 58.709
*Formula: Market Assessed e.g. (Oyo + Uncaptured Market ) (Other markets)
Ekiti:
Total population = 2,398,357
Step 1: 94.69% of 2,398,357
= 2,271,004
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Step 2: (3.008% * 0.4) + (27.82%*0.3) + (51.128*0.2) + (18.045*0.1)
= 1.203+8.35+10.23+1.805
= 21.59% of 2,271,004
= 490,310
Step 3: 28.228% of 490,310
= 138,405 visits from Ekiti
Ondo:
Total population = 3,346,087
Step 1: 90.291% of 3,346,087
= 3,124,835
Step 2: (2.04% * 0.4) + (15.646%*0.3) + (46.939*0.2) + (35.374*0.1)
= 0.816+4.694+9.388+3.537
= 18.435% of 3,124,835
= 576,063
Step 3: 21.022% of 576,063
= 121,100 visits from Ondo
Osun:
Total population = 3,416,959
Step 1: 89.109% of 3,416,959
= 3,044,818
Step 2: (7.018% * 0.4) + (14.912%*0.3) + (56.140*0.2) + (21.930*0.1)
= 2.807+4.474+11.230+2.193
= 20.704% of 3,044,818
= 630,399
Step 3: 20.422% of 630,399
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Table 3: Cost estimate table
Cost Items
1996 QS
Estimate(#)
11.9% inflation Adjusted
values (#)
Monument, Fountain and otherFacilities 39,000,000.00 43,641,000.00
Art Gallery 90,000,000.00 100,710,000.00
Museum 100,500,000.00 112,459,500.00
V.I.P Lodge 87,000,000.00 97,353,000.00
Accomodation Suite 183,300,000.00 205,112,700.00
Administrative Block (A storey
Building) 130,200,000.00 145,693,800.00Shopping Complex (A Storey
Building) 276,000,000.00 308,844,000.00
Multipurpose/conference Hall 83,100,000.00 92,988,900.00
Park's Clinic 42,000,000.00 46,998,000.00
Hotel 72,000,000.00 80,568,000.00
Restaurant 30,000,000.00 33,570,000.00
Sport's Block 107,700,000.00 120,516,300.00
Mechanical workshop 35,100,000.00 39,276,900.00
Fence 219,000,000.00 245,061,000.00
Sports Arena 990,000,000.00 1,107,810,000.00
Animal Garden 1,680,000,000.00 1,879,920,000.00
Saro Wiwa Parking lots 75,000,000.00 83,925,000.00
Sculptural Garden 721,200,000.00 807,022,800.00
Children Amusement Park 924,000,000.00 1,033,956,000.00
Adults Amusement Park 702,000,000.00 785,538,000.00
Swimming Pools 72,000,000.00 80,568,000.00
Artificial Lake 1,050,000.00 1,174,950.00
All Roads with Drainage 6,000,000.00 6,714,000.00
Power house 15,000,000.00 16,785,000.00Electricity/ Generator/
Beautification Lights 1,200,000.00 1,342,800.00
Water Supply/ Boreholes/ Pipesetc 9,000,000,000.00 10,071,000,000.00
Landscaping 210,000,000.00 234,990,000.00
Others 240,000,000.00 268,560,000.00
Total 16,132,350,000.00 18,052,099,650.00
Land Cost Per plot 400,000.00
100 Acres (6 plots per acre) 600.00
Land Cost 240,000,000.00
Agency& Legal @ 10% 24,000,000.00
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Stamp duty @ 2% 4,800,000.00
Total Land Cost 268,800,000.00
Construction&Land Cost 18,320,899,650.00
Average Feeper visit(#)
Total Returns (1,254,784visits)
Percentage
Visit per
specific Facility Real Return(#)(%)
Gate Fee 100 125,478,400.00 100 125,478,400.00
Monument, Fountain and
other Facilities 100.00 125,478,400.00 67.9 85,199,833.60
Art Square 250.00 313,696,000.00 64.3 201,706,528.00
Museum 200.00 250,956,800.00 79.3 199,008,742.40V.I.P Lodge 10,000.00 12,547,840,000.00 5.1 639,939,840.00
Accomodation Suite 500.00 627,392,000.00 8.2 51,446,144.00
Multipurpose/conference Hall 500,000.00 627,392,000,000.00 3.4 21,331,328,000.00
Hotel 2,000.00 2,509,568,000.00 5.1 127,987,968.00
Sport's Block 200.00 250,956,800.00 64.3 161,365,222.40
Animal Garden 200.00 250,956,800.00 72.8 182,696,550.40
Saro Wiwa Parking lots 50.00 62,739,200.00 100 62,739,200.00
Sculptural Garden 150.00 188,217,600.00 100 188,217,600.00
Children Amusement Park 100.00 125,478,400.00 67.3 84,446,963.20
Adults Amusement Park 200.00 250,956,800.00 100 250,956,800.00
Swimming Pools 250.00 313,696,000.00 64.3 201,706,528.00
Artificial Lake 200.00 250,956,800.00 65.9 165,380,531.20
Games 150.00 188,217,600.00 72.1 135,704,889.60
fountain 100.00 125,478,400.00 67.1 84,196,006.40
645,774,585,600.00 24,279,505,747.20
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Gross Return = # 24,279,505,747.20
Less: Running Cost @ say 40%
Tax @ 30%
Allowance for
Depreciation @ 5%
Annual Maintenance 5%
Total 80% #19,423,604,590.00
Net Return #4,855,901,150
Approx. #4,900,000,000.
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Repayments
Year Capital Borrowed
Income (3%
growth in 2years) Capital Interest(21%) Total Interest (21
0
-
18,700,000,000.00 - - 3,927,000,000.00 3,927,000,000.00 3,927,000,00
1 -22,627,000,000.00 4,900,000,000.00 148,330,000.00 4,751,670,000.00 4,900,000,000.00 4,751,670,00
2
-
22,478,670,000.00 4,900,000,000.00 179,479,300.00 4,720,520,700.00 4,900,000,000.00 4,720,520,70
3
-
22,299,190,700.00 5,047,000,000.00 364,169,953.00 4,682,830,047.00 5,047,000,000.00 4,682,830,04
4
-
21,935,020,747.00 5,047,000,000.00 440,645,643.00 4,606,354,357.00 5,047,000,000.00 4,606,354,35
5
-
21,494,375,104.00 5,198,410,000.00 684,591,228.00 4,513,818,772.00 5,198,410,000.00 4,513,818,77
6
-
20,809,783,876.00 5,198,410,000.00 828,355,386.00 4,370,054,614.00 5,198,410,000.00 4,370,054,61
7
-
19,981,428,489.00 5,354,362,300.00 1,158,262,317.00 4,196,099,983.00 5,354,362,300.00 4,196,099,98
8
-
18,823,166,172.00 5,354,362,300.00 1,401,497,404.00 3,952,864,896.00 5,354,362,300.00 3,952,864,89
9
-
17,421,668,768.00 5,514,993,169.00 1,856,442,728.00 3,658,550,441.00 5,514,993,169.00 3,658,550,44
10
-
15,565,226,040.00 5,514,993,169.00 2,246,295,701.00 3,268,697,468.00 5,514,993,169.00 3,268,697,46
11
-
13,318,930,339.00 5,680,442,964.00 2,883,467,593.00 2,796,975,371.00 5,680,442,964.00 2,796,975,37
12
-
10,435,462,746.00 5,680,442,964.00 3,488,995,787.00 2,191,447,177.00 5,680,442,964.00 2,191,447,17
13 -6,946,466,959.00 5,850,856,253.00 4,392,098,192.00 1,458,758,061.00 5,850,856,253.00 1,458,758,06
14 -2,554,368,767.00 5,850,856,253.00 5,314,438,812.00 536,417,441.00 5,850,856,253.00 536,417,44
15 2,760,070,045.00 - - - - -
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Conclusion
From the market survey report and analysis, It has been derived that subject to the assumptions
made in this report, the project should reasonably payback within the first 15years of its life. The
project derived an estimated 1,254,784 visits per year from the markets identified, and the cost of
establishing the project was estimated at #18,320,899,650.00. The Net annual return was
approximately summed up to #4,900,000,000 and based on this estimate of cost and revenue, the
pay-back period was derived to be 15 years.