Assignment 2 - Resort Proposal at Pulau Langkawi

SCHOOL OF ARCHITECTURE, BUILDING AND DESIGN
BACHELOR OF QUANTITY SURVEYING (HONOURS)
MGT60704 PROJECT MANAGEMENT
AUGUST 2018 SEMESTER
RESORT PROPOSAL AT PULAU LANGKAWI
GROUP MEMBERS:
NO. NAME STUDENT ID
1. PANG KAI YUN 0319802
2. SAM WEI YIN 0320364
3. TRACE GEW YEE 0320269
4. YEO KAI WEN 0319844
5. CHOW KAH YIEN 0320300
6. AUDREY TING 0320247
LECTURER : MR LEONG BOON TIK
SUBMISSION DATE : 27 NOVEMBER 2018
TABLE OF CONTENTS

1
CONTENT PAGE NUMBER
1.0 Introduction
1.1 Project Background
1.2 SWOT Analysis
4
4
6
2.0 Project Proposed Design
2.1 Proposed Project Description
2.2 Proposed Layout Planning
2.3 Proposed Project Capacity
2.4 Proposed Design Concept
2.5 Proposed Building Design Illustration
7
7
8
10
11
13
3.0 Procurement Management
3.1 Design and Build (D&B) Procurement Method
3.2 Process of Design and Build (D&B) procurement Method
14
14
16
4.0 Time Management
4.1 Work Breakdown Structure (WBS)
4.2 Schedule Control in Pre-Construction Stage to
Completion Stage
17
17
18
5.0 Cost Estimation
5.1 Construction Cost
5.2 Development Cost
5.3 Operating and Maintenance Cost
5.4 Summary
5.5 Gross Development Value (GDV)
5.6 Profit
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22
24
25
28
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28
6.0 Quality Management
6.1 Quality Assessment System in Construction (QLASSIC)
29
29
7.0 Risk Management
7.1 Introduction to Risk Management
7.2 Risk planning
7.3 Risk identification
7.3.1 Cost Risk
7.3.2 Schedules risk
7.3.3 Performance risk
7.3.4 Governance risk
7.3.5 Strategic risk
7.3.6 Market risk
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34
35
35
36
36
36
36
37

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7.3.7 Legal risk
7.3.8 Risk associated with external hazards.
7.4 Risk projection
7.5 Risk Response, monitoring and mitigation
37
37
37
39
8.0 Environment Protection Management
8.1 Government Policy
8.1.1 Pre-construction stage
8.1.1.1 Environmental Quality (Prescribed
Activities) (Environmental Impact
Assessment) Order 1987
8.1.1.2 Town and Country Planning Act 1976
(Act 172)
8.1.2 Construction stage
8.1.2.1 The Environmental Quality Act 1974
8.1.2.2 Environmental Quality (Clean Air)
Regulations 1978
8.1.2.3 Environmental Quality (Control of
Emission from Diesel Engines) Regulation 1996
8.1.2.4 Environmental Quality (Control of
Emission from Petrol Engines) Regulations
1996
8.1.2.5 Environmental Quality (Sewage and
Industrial Effluents) Regulations 1979
8.1.2.6 Pesticides (Highly Toxic Pesticides)
Regulations 1996
8.1.2.7 Earthwork By-law 1996
8.2 UNESCO
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40
40
40
41
41
41
41
42
42
42
43
43
9.0 Summary 44
Reference 45
Appendix 47

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1.0 Introduction
This report aims to provide a reliable record for the client to have an idea of the
overall expenditure of the proposed development. To ease the decision making of the client in
investing the proposed project. Thus, we have carried out a study of the background of the
project, the proposed design of the project, project time management, project cost estimation,
project quality management, project risk management, project procurement management, and
project environment protection management for our client have an easy reference on it.
1.1 Project Background
Figure 1.1: Location plan of proposed project
Our proposed site location will be located in Langkawi, Malaysia. Langkawi is a
jewel and a natural paradise in the whole of South East Asia, which most of the tourist will
come to visit and stay. Langkawi is a popular tourist destination to visit. Driven by a surge in
soaring interest in Malaysia as a tourist destination, for the previous years have been the best
year till date, Langkawi has welcomed 1.3 million tourists in this year 2018 to date.

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Langkawi is surrounded by the emerald blue water and the lovely sunny beaches are dreams
for the beach lovers and those who love water sport activities.
Figure 1.2: Site plan of proposed project
The proposed site is a freehold land measuring 1.958 acres which is situated at Kuah,
Langkawi, Kedah, Malaysia. Kuah, is the capital city of the Langkawi, is located on the main
island, which is where most of the activities take place. The proposed site is a freehold land
measuring 1.958 acres which is approximately 7,924m2. The proposed site is situated at
Kuah, Langkawi, Kedah, Malaysia. Kuah The land was purchased recently at RM
14,080,000.00. The land status is under commercial and hotel. Therefore, the development
plan has been approved by the local authority for building with 4 storeys of resort with indoor
swimming pool. Development order has been granted, construction is ready to process. Soil
investigation has been carried out, the land is suitable for construction. The construction will
take 3 years to complete it.

5
Table 1.1: Summary of proposed project background
Element Description
Land Size 1.958 Acres (7,924 m2)
Location Kelibang, Kuah Town, Langkawi
Type of Land Freehold
Land status Commercial and Hotel
Selling Price RM 14,080,000.00
1.2 SWOT Analysis (SWOT)
To start up a hotel or resort business is one of the most important services which
directly affect the arrival of the tourists to a particular place. The hotel industry plays a
significant role when it comes to a tourism location. Therefore, we had performed a SWOT
analysis on this business which can provide our clients to have an insight about the goal of
the business of the hotel and resort.
Table 1.2: SWOT Analysis
SWOT ANALYSIS
STRENGTH WEAKNESSES
● Strategic location
● Well established brand
● Loyal customer based
● Open sector
● Contributes to Local Economy
● Expensive resort operations
● Dependent upon seasonal workforce
● High dependency on tourists
● Not diversified

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SWOT ANALYSIS
OPPORTUNITIES THREATS
● High potential in emerging markets
● Reduce foreign currency exchange
rate uncertainty through hedging
● Collaboration with local and
international airways
● Digitalization and better use of
technology
● Growing competition from the same
industry in Pulau Langkawi
● The impact of economic downturn
on executive travelling
● Competition on price point
Kuah Hotel Resort Competition
Competitors Below are the 3 main hotels for the
Kual Hotel Resorts competitors:
1. G Langkawi Motel
2. T Hotel Resort
3. Twin Peaks Island Hotel

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2.0 Project Proposed Design
2.1 Proposed Project Description
Table 2.1: Proposed Project Description
Element Description
Project Name Kuah Hotel Resort
No. of Floors 4 storey height of hotel resort consist of:
- Ground Floor (Lobby, Car Parking Lots, Cafe, Restaurant, Wellness
spa center, Hotel and Suite Rooms)
- First Floor to Third Floor (Hotel and Suite Rooms)
The development plan has been approved by the local authority for building with 4
storeys of resort with indoor swimming pool. Therefore, our proposed concept design will be
40% of building, 20% of road work , 20% of car park area and 20% of the landscape. The
zoning will be shown as follows:
Figure 2.1: Concept design of the layout of the building

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2.2 Proposed Layout Planning
The following are the proposed layout required for the hotel resort:
Hotel & Suite Rooms
The hotel will be stylish, comfortable, well furnished and air-conditioned rooms with
contemporary luxury and gracious services. All guest room are attached with a private
balcony to have a overlooking a panoramic view of the mesmerizing or lush green landscape
surrounding the resort.
Restaurant and Bars
The hotel resort will be having 1 nos. of restaurant, a lounge bar, and a cafe. The
restaurant will be offering a choice of continental, provide a variety of food from Malay
cuisine, Chinese cuisine and Indian cuisine to promote our best of Malaysia’s food.
The cafe will be also well stocked with the best of coffee where the guest can spend
their leisure time in the cafe.
The lounge bar will be having a music lounge and weekend live music, which will be
equipped with the sound and light system. A disco night will be arranged on every weekend
for the guest to enjoy.
24 Hour Front Desk
The hotel will also have a 24 Hour front desk which will help the visitors to check in
and check out for the rooms. Besides, it also provides a travel desk which will help the
visitors to gather the information and sketch a tour for visiting the tourist place.

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Limousine Service
The hotel will also provide limousine services for pick up, the company will buy the
vehicles to pick the guest from the airport.
Wellness Spa Center
The resort will be having a oriental spa center which provides reflexology and Thai
massage.
Reflexology is based on “reflex areas” on hands and feet. Through this therapy, it can
help to reduce stress and discomfort, especially when the guest standing and walking whole
day long. Thai massage is more energizing compare to other forms of massage. This massage
can reduce muscle spasticity, back pain, and has been shown useful in treating balance
problems.
Swimming pool, jacuzzi and steam sauna
A swimming pool facility is a must for the hotel resort and it will be instrumental for
the popularity of the hotel resort. There will also provide the juice and snack bars along with
the swimming pool to add to the service provision.

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2.3 Proposed Project Capacity
Table 2.2: Proposed project capacity of the building
Item Spaces No.
1. Types of rooms 108
i. King Suite - 44m2 26
ii. Queen Suite - 35m2 2
iii. Deluxe Room - 29m2 37
iv. Standard Room - 25m2 43
2. Restaurant 1
3. Coffee cafe 1
4. Lounge Bar 1
5. Wellness Spa Center 1
6. Administrative Office 1
7. Kitchen 1
8. Laundry 1
9. Swimming Pool 1

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2.4 Proposed Design Concept
Table 2.3: Proposed design concept of the building (Hotel Room)
Hotel Room
Standard Room Deluxe Room
Queen Suite King Suite

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Table 2.4: Proposed design concept of the building (Facilities)
Facilities
Restaurant Coffee Cafe
Lounge Bar Wellness Spa Center
Swimming Pool Front Desk

13
Hotel Lobby Open Car Park Space Area
2.5 Proposed Building Design Illustration
Figure 2.2: Front view of the illustration building
Figure 2.3: Side view of the illustration building

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3.0 Procurement Management
The building procurement determines the overall framework and structure of
responsibilities as well as the authorities for participants within the building process
(Skitmore & Earl, 1998). It is a key element that contributes to overall client satisfaction and
project success. Therefore, choosing the right method of procurement is extremely important
as it is a major determinant of project success.
3.1 Design and Build (D&B) Procurement Method
Figure 3.1: Design and Build contractual relationship; Sources: Contractual Arrangement
(Trett, 2015)
In order to match Client’s requirements, this proposed project will be using design
and build (D&B) procurement method. A design and build contract is an agreement between
a client and a contractor where the contractor undertake the design and build a project in
accordance to the requirements laid down in the “Employer’s Requirements” section of the
contract documents. This contract documents is a single financial transaction with a single
point of control and responsibility.

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Based on the Figure 7.2 above, it is advisable that the client should bring consultants
into the whole process. The client’s consultant role in the process is to provide an
independent advice on setting up and defining the project as well as inspecting the work of
contractors. Besides that, the client can assign a project manager to represent him/her in order
to take the responsibility for the day to day management of the project.
Apart from that, this approach offers a fast track construction when compared to the
traditional approach as a contractor can start the work on the site before detailed design is
completed. Hence, the overall project delivery time can be reduced from the inception till the
completion of the project. At the same time, greater collaboration from the initial till the end
of the project enable the architect and contractor to create a more efficient and streamlines
project schedules while results in less change orders. Design and build approach also offers a
reasonable certainty over costs provided that client does not order any changes during the
construction work. Then the contractor will complete the project for the contract sum.
As shown above, design and build indeed is a good approach that suitable for client
compared to the traditional approach. Since everything is managed by contractors, elements
like design and construction can be overlap which potentially deliver the project in a shorter
time while save some money along the way. Prior to everything is coordinated by one
contractor, it allows client extra flexibility throughout the project. Besides, this approach is
considered a low risk procurement method for the client, in terms of time and cost. However,
there might be risk in associate with design and quality, if client’s requirement were not
properly collected and when there is insufficient time to examine the contractor’s proposal.

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3.2 Process of Design and Build (D&B) Procurement Method
Figure 3.2: The Process of Design and Build; Sources: Procurement Systems (Kyei, K. A,
2009)
The design and build process begins with the client appoints the design consultants to
prepare and submit the layout design to the appropriate authority. Once the layout design is
approved, tender documents can be prepared based on the Approximate Bills of Quantities.
After that, a short list of D&B contractors are invited to tender in which the tender will be
based on the Approximate Bills of Quantities. Hence, it will be possible to select the lowest
price tender based on price competition.
After the D&B contractor has been appointed, the design consultants can either be
retained for supervisory function to ensure that the D&B contractor complies with the
contract requirement or novated to the D&B contractor to complete the design for the D&B
contractor to carry out the Works.

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4.0 Time Management
4.1 Work Breakdown Structure (WBS)
Figure 4.1: Work breakdown structure

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4.2 Schedule Control in Pre-Construction Stage to Completion Stage
In the early of January of 2019, the consultant team shall outline the requirement of
the client and open tender to the contractor that are listed which suggested by the consultant
firm and architecture firm. Therefore, the selected contractor shall have the conceptual design
to priced the price based on the drawing given by the architecture. Once the contractor had
selected and chosen by the client, the contractor may start to prepare for the detailed design
of the project. Therefore, the construction can start in the mid of the February of 2019. The
construction is estimated to complete by early of May in the year 2021.
Table 4.1: Schedule Control in Pre-Construction Stage to Completion Stage
Activity ID Task Name Duration Start Finish
Resort, Pulau Langkawi 673 days Jan 2 '19 Jul 30 '21
1.0 Pre-Construction Stage 62 days Jan 2 '19 Mar 28 '19
1.1 Appoint design consultant team 14 days Jan 2 '19 Jan 21 '19
1.2 Appoint D&B contractor 7 days Jan 22 '19 Jan 30 '19
1.3 Detailed Design 20 days Jan 31 '19 Feb 27 '19
1.4 Obtain building permits 21 days Feb 28 '19 Mar 28 '19
2.0 Construction Stage 521 days Mar 29 '19 Mar 26 '21
2.1 Site Preparation 26 days Mar 29 '19 May 3 '19
2.1.1 Soil investigation 7 days Mar 29 '19 Apr 8 '19
2.1.2 Site clearing 4 days Apr 9 '19 Apr 12 '19
2.1.3 Install temporary power 3 days Apr 15 '19 Apr 17 '19
2.1.4 Install temporary water service 2 days Apr 18 '19 Apr 19 '19
2.1.5 Set up site office 3 days Apr 22 '19 Apr 24 '19
2.1.6 Temporary Fencing 3 days Apr 25 '19 Apr 29 '19
2.1.7 Mobilize on site 4 days Apr 30 '19 May 3 '19

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2.2 Substructure 104 days May 6 '19 Sep 26 '19
2.2.1 Earthworks 72 days May 6 '19 Aug 13 '19
2.2.1.1 Excavation 72 days May 6 '19 Aug 13 '19
2.2.2 Foundation 32 days Aug 14 '19 Sep 26 '19
2.2.2.1 Piling 32 days Aug 14 '19 Sep 26 '19
2.3 Superstructure 166 days Sep 27 '19 May 15 '20
2.3.1 Frame and Upper Floor 87 days Sep 27 '19 Jan 27 '20
2.3.1.1 Columns 44 days Sep 27 '19 Nov 27 '19
2.3.1.2 Beams 43 days Nov 28 '19 Jan 27 '20
2.3.2 Upper Floor 20 days Jan 28 '20 Feb 24 '20
2.3.2.1 Floor slab 20 days Jan 28 '20 Feb 24 '20
2.3.3 Staircase 10 days Feb 25 '20 Mar 9 '20
2.3.3.1 Staircase structure 10 days Feb 25 '20 Mar 9 '20
2.3.4 Roof 19 days Mar 10 '20 Apr 3 '20
2.3.4.1 Roof structures 14 days Mar 10 '20 Mar 27 '20
2.3.4.2 Roof covering 5 days Mar 30 '20 Apr 3 '20
2.3.5 Doors and Windows 12 days Apr 6 '20 Apr 21 '20
2.3.5.1 Door & window frame 7 days Apr 6 '20 Apr 14 '20

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2.3.5.2 Door & window leaves 5 days Apr 15 '20 Apr 21 '20
2.3.6 External and Internal Wall 18 days Apr 22 '20 May 15 '20
2.3.6.1 Masonry work 9 days Apr 22 '20 May 4 '20
2.3.6.2 Partitions 9 days May 5 '20 May 15 '20
2.3.7 Finishes 52 days May 18 '20 Jul 28 '20
2.3.7.1 Internal wall finishes 6 days May 18 '20 May 25 '20
2.3.7.2 External wall finishes 5 days May 26 '20 Jun 1 '20
2.3.7.3 Floor finishes 16 days Jun 2 '20 Jun 23 '20
2.3.7.4 Ceiling finishes 15 days Jun 24 '20 Jul 14 '20
2.3.7.5 Staircase finishes 10 days Jul 15 '20 Jul 28 '20
2.3.8 Furnishings and Fittings 46 days Jul 29 '20 Sep 30 '20
2.3.8.1 Furniture 16 days Jul 29 '20 Aug 19 '20
2.3.8.2 Equipment 15 days Aug 20 '20 Sep 9 '20
2.3.8.3 Sanitary wares 15 days Sep 10 '20 Sep 30 '20
2.4 Services 61 days Oct 1 '20 Dec 24 '20
2.4.1 Plumbing installation 10 days Oct 1 '20 Oct 14 '20
2.4.2 Electrical installation 6 days Oct 15 '20 Oct 22 '20
2.4.3 Air-conditioning & ventilating
installation
10 days Oct 23 '20 Nov 5 '20
2.4.4 Fire protection installation 20 days Nov 6 '20 Dec 3 '20
2.4.5 Lift installation 15 days Dec 4 '20 Dec 24 '20

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2.5 Infrastructure Works 66 days Dec 25 '20 Mar 26 '21
2.5.1 Sewerage works 5 days Dec 25 '20 Dec 31 '20
2.5.2 Surface water drainage 16 days Jan 1 '21 Jan 22 '21
2.5.3 Road works 20 days Jan 25 '21 Feb 19 '21
2.5.4 Walkway 14 days Feb 22 '21 Mar 11 '21
2.5.5 Fencing 4 days Mar 12 '21 Mar 17 '21
2.5.6 Landscaping 7 days Mar 18 '21 Mar 26 '21
3.0 Completion Stage 26 days Mar 29 '21 May 3 '21
3.1 Complete Final Inspections 7 days Mar 29 '21 Apr 6 '21
3.2 Demobilization 5 days Apr 7 '21 Apr 13 '21
3.3 Cleaning and Clearing 14 days Apr 14 '21 May 3 '21

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5.0 Cost Estimation
The cost that is associated with this project include both the initial capital cost and the
subsequent operation and maintenance costs. As mentioned in the previous section, the cost
of the land is RM 14,080,000.00. The construction cost is estimated using the JUBM
Construction Cost Handbook 2018. The cost data is up to date and can produce accurate
estimation. The development cost which include professional fee, administrative fees, plan
fees, legal fee and contingencies is calculated based on the assumption made. Beside that, the
proposed project is estimated to operate for 20 years. The cost to operate and maintain the
resort include utilities cost, labour cost, repairing cost, advertising cost and
telecommunication cost.
Moreover, Gross Development Value (GDV) is calculated to know the value of this
new development would fetch on the open market if it were to be sold in the current
economic climate. Profit is calculated to know the amount of revenue gained after all costs
and expenses have been deducted from total sales.
5.1 Construction Cost
Building cost
Total CFA of the building = 60% x 7,924m2 x 4 storey
= 19,017.60m2
Cost per m2 = RM 4100/m2
Total building cost = 19,017.60m2 x RM 4100/m2
= RM 77,972,160.00

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Construction Cost
Swimming Pool = RM 1,202,000 + RM 287,500 + RM 345,000
= RM 1,834,500
Carpark = 20% x 7,924m2 x RM 700/m2
= RM 1,109,360
Earth Works = 5% of building costs
= 5% x RM 77,972,160.00
= RM 3,898,608.00
Infrastructure costs = 10% of building costs
= 10% x RM 77,972,160.00
= RM 7,797,216.00
Total Construction Cost = RM 77,972,160.00 + RM 1,834,500 + RM 1,109,360 +
RM 3,898,608.00 + RM 7,797,216.00
= RM 92,611,844.00
≃ RM 93,000,000.00

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5.2 Development Cost
The assumption is made as follow:
i. Professional Fees : 9% of construction costs
Ii. Administrative Fees : 2% of construction costs
iii.Plan Fees : 2% of construction costs
iv. Legal Fees : 1% of construction costs
v. Contingencies : 5% of construction costs
No. Fees % Allocated Construction Cost (RM) Total
1. Professional Fees 9% 93,000,000 RM 8,370,000
2. Administrative Fees 2% 93,000,000 RM 1,860,000
3. Plan Fees 2% 93,000,000 RM 1,860,000
4. Legal Fees 1% 93,000,000 RM 930,000
5. Contingencies 5% 93,000,000 RM 17,670,000
TOTAL RM 17,670,000

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5.3 Operating and Maintenance Cost
Utilities Cost
Include electrical and water
Calculation:
Electrical = 2 kwh per unit x 18 hr x 108 unit x RM 0.40/kwh x 30 days = RM 46,656.00/mth
Allow 40% for lobby, swimming pool, restaurant = RM 18,662.40
Total cost = RM 65,318.40 / mth
Water = 180m3/day x RM 2.28/m3 x 30 day = RM 12,312/mth
Total utilities cost = RM77,630.40 ≃ RM 80,000/mth
Year Cost per month Cost per year Total cost
1 - 5 RM 80,000 RM960,000 RM 4,800,000
5 - 10 RM 85,000 RM 1,020,000 RM 5,100,000
10 - 15 RM 90,000 RM 1,080,000 RM 5,400,000
15 - 20 RM 95,000 RM 1,140,000 RM 5,700,000
TOTAL RM 21,000,000
Labour Cost
Year No. of Worker Salary per Month Salary per year Total
1 - 5 80 RM 4,000 RM 3,840,000 RM 19,200,000
5 - 10 80 RM 4,500 RM 4,320,000 RM 21,600,000
10 - 15 90 RM 5,000 RM 5,400,000 RM 27,000,000
15 - 20 90 RM 5,500 RM 5,940,000 RM 29,700,000
TOTAL RM 97,500,000

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Repairing Cost
Include furniture, air-cond and safety equipment
Year Cost per month Cost per year Total
1 - 5 RM 10,000 RM120,000 RM 600,000
5 - 10 RM 12,000 RM 144,000 RM 720,000
10 - 15 RM 14,000 RM 168,000 RM 840,000
15 - 20 RM 16,000 RM 192,000 RM 960,000
TOTAL RM 3,120,000
Advertising Cost
Include website, brochures, business cards, newspapers advertisement
1 - 5 RM 5,000 RM60,000 RM 300,000
5 - 10 RM 7,000 RM 84,000 RM 420,000
10 - 15 RM 10,000 RM 120,000 RM 600,000
15 - 20 RM 12,000 RM 144,000 RM 720,000
TOTAL RM 2,040,000

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Telecommunication Cost
Include wi-fi
1 - 5 RM 2,000 RM24,000 RM 20,000
5 - 10 RM 3,000 RM 36,000 RM 180,000
10 - 15 RM 4,000 RM 48,000 RM 240,000
15 - 20 RM 5,000 RM 60,000 RM 300,000
TOTAL RM 840,000
Total Operating and Maintenance Cost for 20 years
Element Total Expenses
Utilities Cost RM 21,000,000
Labour Cost RM 97,500,000
Repairing Cost RM 3,120,000
Advertising Cost RM 2,040,000
Telecommunication Cost RM 840,000
TOTAL RM 124,500,000

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5.4 Summary
Element Total Percentage
Construction Cost RM 93,000,000 40%
Development Cost RM 17,670,000 8%
Operating and Maintenance Cost RM 124,500,000 53%
TOTAL RM 235,170,000 100%
5.5 Gross Development Value (GDV)
Assume 30% developer profit
GDV = Land Cost + Construction Cost + Development Cost + 30% Developer Profit
= (RM 14,080,000 + RM 93,000,000.00 + RM 17,670,000) + RM 37,425,000
= RM 162,175,000.00
5.6 Profit
Assume 70% of occupancy rate in 1 year
Total Room Revenue = 108 unit x RM 300/room x 70% occupancy rate x 365 days
= RM 22,680/day
Revenue per year = RM 22,680 x 365 days
= RM 8,278,200/year
Revenue for 20 years = RM 165,564,000
Profit = RM 165,564,000 - RM 124,500,000 = RM 41,064,000.00

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6.0 Quality Management
6.1 Quality Assessment System in Construction (QLASSIC)
Quality Assessment System in Construction (QLASSIC) is developed by
Construction Industry Development Board (CIDB) Malaysia since 2006. This system
measures and evaluates the quality of workmanship and finishes of a building construction
through a scoring system, according to Construction Industry Standard (CIS). This system
enables the comparison of quality between the local construction projects.
QLASSIC assessment will be conducted after completion of a building construction
works, before handing over of the completed projects. QLASSIC evaluates the building by
conducting an inspection and field testing at the construction site. Hence, the score has to be
gained during the first inspection. However, the assessment will not be scored again even
after rectification works has been completed, if there are any issues found upon the first
inspection. This lets the contractor to “do things right the first time and everytime”.
Figure 6.1 QLASSIC Process Flow

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Therefore, for this project, in order to achieve a high quality project, we have
proposed to adopt QLASSIC assessment into this project as the quality management strategy.
QLASSIC is a system that measures and evaluate the quality of workmanship and finishes of
a building construction in accordance with the Construction Industry Standard (CIS), by
using a scoring system. Hence, this system enables the quality to be compared between local
construction projects.
Table 6.1 The Distribution of weightage for the elements of building construction works
based on the Building category
Element
Residential Building Non-Residential Building
Category A
(Landed
Housing)
Category B
(Stratified
Housing)
Category C
(Public/
Commercial/
Industrial
buildings)
Category D
(Public/
Commercial/
Industrial buildings)
Structural
works
15% 20% 20% 20%
Architectural
works
70% 60% 55% 50%
M&E works 5% 10% 15% 20%
External
works
10% 10% 10% 10%
Total score 100% 100% 100% 100%

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The four category of building consist of:
1. Category A (Landed housing)
- Detached, semi-detached, terrace and cluster houses.
2. Category B (Stratified housing)
- Flats, apartments, condominiums, service apartments, small office home office
(SOHO) and townhouses.
3. Category C (Public/commercial/industrial buildings without centralised cooling
system)
- Office buildings, schools, factories, warehouses, workshops, hangers, small
office flexible office (SOFO), small office virtual office (SOVO), religious
buildings, stadiums, community halls, hospitals, airports, universities,
colleges, police stations, etc.
4. Category D (Public/commercial/industrial buildings with centralised cooling system)
- Office buildings, schools, factories, warehouses, workshops, hangers, small
office flexible office (SOFO), small office virtual office (SOVO), religious
buildings, stadiums, community halls, hospitals, airports, universities,
colleges, police stations, etc.
According to this project, it will be categorized under “Category D” as this project
meets the requirement of being a commercial building.
In order to succeed in implementation of QLASSIC, the relevant documents must
specify that we require a minimum of 70% QLASSIC score for the buildings. By submitting
the details of the contractors together with the contract documents and tender documents, it
will lend a hand in ensuring the contractors who is tendering for this project are qualified
enough to meet the quality standard.
The reason in applying QLASSIC into this project, it is to insure that this project will
accomplish a quality with high level for the workmanship, as it will definitely meet the
client’s requirements. Even if the requirements are not stated, it would be rational to point out

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that the quality of the works would require to be even with the industry standards so as for the
development to serve its aim.
Furthermore, by executing this assessment into this project, the contractors will have
to be cautious and be serious about the work quality as there would not be a second
opportunity because of the nature of QLASSIC which does not allow a rescore. Thence, the
probability of defect and rework in the project that can be lessened since contractors must
conduct the work correctly the first time.
Moreover, QLASSIC is an independent technique to measure and analyse the quality
of workmanship. It provides an impartial assessment of a project. In addition, the QLASSIC
assessor is an independent individual that has no personal interest in any aspect of the project,
therefore the assessment will be equitable and the outcomes will be precise.
By conducting QLASSIC assessment, the parties would be able to apply this
assessment technique that was already complete with quality standards which brings
advantages to both the clients and contractors. Contractors should not find it hard to
understand and comply the criteria necessary to evaluate their work in ensuring the quality
requirements of the client are met.

33
7.0 Risk Management
7.1 Introduction to Risk Management
Risk management is a process in a project management. It used to identify and
minimize the negative risk that might affect the project. Project risk is always in the future.
Risk is an uncertain event or condition that, if it occur, has an effect on at least one project
objective. A risk may have one or more cause and, if it occurs, it may have one or more
impacts. Project risk has its origins in the uncertainty present in all projects. Risks that have
been identified and analysed is said as known risk. Known risk is possible to plan since it is
already identified and analysed. Specific unknown risk cannot be managed proactively,
which suggests that the project team should create a contingency plan. A project risk that
occurred can also be considered an issue.
The effect of uncertainty on project and organizational objectives is perceived risk for
an organization. Organization and stakeholders are willing to accept a varying degree of risk.
This action is known as risk tolerance. If the risk is within tolerances and are in balance with
the rewards that may gained by taking the risks may be accepted.
Risk management planning, risk identification, risk analysis, response planning and
monitoring and control on project is the process of project risk management. Plan risk
management is a process of defining the way to conduct risk management activities for a
project. Participant in doing the risk management for a project, including project manager,
project team members, risk management team (if assigned), client, consultant team, subject
matter expert from outside of the project team and risk management experts. Next, the team
needs to identify which risk may affect the project and documenting their characteristic. After
identifying the risk of the project, the team might need to analyse the risk and develop
options and action to enhance opportunities and reduce threats to the project objective.
Lastly, the team need to implement risk response plans, tracking identified risks, monitoring
residual risks, identifying new risks, and evaluating risk process effectiveness throughout the
projects.

34
7.2 Risk planning
Before doing risk identification, project management team needs to categorize the
risk. This is to ensure a comprehensive process of systematically identifying risk to a
consistent level of detail and contributes to the effectiveness and quality of the identify risk
process. A previous prepared categories framework is used to categorize into a Risk
Breakdown structure (RBS). We had breakdown the risk into technical risk, external risk ,
internal risk and project management risk. The figure below show the RBS of our project:
Figure 7.1: Risk Breakdown structure.

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7.3 Risk identification
Risk identification is an iterative process. This is because new risk may evolve or
become known as the project progresses through its life cycle. From the RBS, a
brainstorming session is carried out to identify the potential risk for this project. The potential
risk is stated as below:
1. Cost risk
2. Schedules risk
3. Performance risk
4. Governance risk
5. Strategic risk
6. Operation risk
7. Market risk
8. Legal risk
9. Risk associated with external hazard
7.3.1 Cost Risk
Cost risk typically escalation of project cost due to poor cost estimating accuracy and
scope creep. These risks include base cost uncertainty, the monetary impact of discrete risks
as defined in the risk register plus escalation, as well as the monetary impact of schedule
delays through extended overhead and additional escalation caused by schedule delays. Next,
cost overrun was also categorized in a project. In construction projects, client normally has a
tight budget that must not be exceeded to ensure the project still working and acquiring profit.
Cost overrun might cause the project to sustain and may need to terminate the project in
extreme cases. This problem may arise due to incompetent of consultant team such as
inaccurate cost estimate produced by the consultant quantity surveyor, the BQ produce by the
consultant quantity surveyor is not competent. Lastly, fluctuation of the material price might
also one of the cost risk.

36
7.3.2 Schedules risk
Schedules risk is risk that activities will take longer than expected slippages in
schedules. Normally this kind of risk will occur during the construction stage which we call
construction delay. This might bring a negative effect to the project. Besides, the delay in
delivery the product on time might cause a loss of competitiveness. Moreover, change in
client requirement during the construction stage might become one of the schedules risk. The
client might want to change some aspects of the project such as design of the building and
material used. The changes may be influenced by the market trend. It can also be due to the
client intention and requirements are not clearly conveyed in later stages of the works. These
changes might disrupt the work progress of the construction.
7.3.3 Performance risk
Performance risk can be defined as the risk that the project will fail to produce results
consistent with the project specification. Obsolete design and poor buildability, poor
workmanship and etc. Obsolete design can lead to performance risk due to the design of the
building is not attractive to the public. Next, poor buildability can lead to extra cost and
longer time required for construction.
7.3.4 Governance risk
Governance risk is risk related to the board and management performance with regard
to ethics, community stewardship and company reputation.
7.3.5 Strategic risk
Risk including in strategic risk must from errors in strategy. For example chosen a
technology that can’t be made to work.

37
7.3.6 Market risk
Market risks arise when there is competition, foreign exchange, commodity market
and interest risk as well as liquidity and credit risk.
7.3.7 Legal risk
This kind of risk arises from legal and regulatory obligation, including contract risk
and litigation brought against the organization. For example, the project does not meet
authorities’ requirements or regulation. This project might take this as the priority risk due to
the location of the site.
7.3.8 Risk associated with external hazards.
Type of risk fall under this category might be force major. For instant, flood (due to
its location), tsunami and labour strikes.
7.4 Risk projection
Risk projection is the process came after risk identification. There are two ways to
carry out this process which is qualitative risk analysis and quantitative risk analysis. Risk
projection is performed by analysing each risk and determining the probability of the risk
happening along with its severity if the risk occurs. The risk rating then can derives for each
risk based on these 2 aspects and the most impactful risk can be established by using the risk
matrix. This is to allow prioritization of risk for effective risk management, due to the limited
resource available to address all of the risks. The severity, likelihood and risk rating of the
risk are shown in the following table. The categories which the risk belongs to according to
the risk matrix.

38
Figure 7.2 Risk Matrix
Table 7.3: Risk projection table.

39
From the table above, the project management team could let the client know what
risk they need to monitor and mitigate. The risk that required to mitigate are risk fall under
undesirable and unaccepted, which is cost risk, governance risk, strategy risk, market risk and
legal risk. The risk that need monitoring will be risk associated with external hazard and
performance risk.
7.5 Risk Response, monitoring and mitigation
Risk response is a process of developing option and determining actions to solve the
risk and enhance the opportunities for the project. It can also be said as planning a strategy to
mitigate and monitoring the undesirable and acceptable risk.
Risk monitoring and mitigation is the process of keeping track of the identified risk,
monitoring residual risk and identifying new risks. Besides, this process is also used to ensure
the execution of risk plans, and evaluating their effectiveness.
Table 7.1: Strategy to control and mitigate the undesirable risk.
Potential Risk Strategies to control and mitigate
Cost Risk ● Engage a competitive consultant team during cost
estimating.
● Reliable supply
Governance Risk ● Improve communication pathway
Strategies Risk ● Implement a well known technology instead of a new
one.
Marketing Risk ● Ensure the design and the function the building is
competitive compare to other.
Legal Risk ● Ensure the design and specification of the building
fulfill the authorities’ requirement.
● Ensure the parties enter into contract understand
clearly on their right and obligation to avoid dispute.

40
8.0 Environment Protection Management
Construction activities have the potential to impact their surroundings, including
neighbours as well as the natural and built environment. Good environmental practice enables
these impacts to be managed positively. Impacts can take many forms, for example effects on
the surrounding flora and fauna, watercourses, noise or pollution. Clients, their professional
advisers, contractors and the whole construction supply chain have responsibilities for
appropriate environmental management, ensuring compliance with legal and other
requirements (Audus, Charles, & Evans, 2010).
8.1 Government Policy
8.1.1 Pre-construction stage
8.1.1.1 Environmental Quality (Prescribed Activities) (Environmental Impact
Assessment) Order 1987
Environmental Impact assessment is required for the Resort and Recreational
Development such as construction of coastal resort facilities or hotel with more than 80
rooms, development of tourist or recreational facilities in national parks, development of
tourist or recreational facilities on islands in surrounding waters which are gazetted as
national marine parks.
8.1.1.2 Town and Country Planning Act 1976 (Act 172)
The Tree Preservation Order prohibits the developer from cutting trees unless with
written approval from the relevant authority. They are Prohibited from cutting trees from
specified size, age, type or species which has existed at that location.

41
8.1.2 Construction stage
8.1.2.1 The Environmental Quality Act 1974
The purpose of the Environmental Quality Act is to prevent, eliminate, control
pollution and improve the environment. According to the act, there are some rules to follow
during the construction such as no person shall allow or cause open burning on any premises,
no person shall, unless licensed, emit or cause or permit to be emitted any noise greater in
volume, intensity or quality in contravention of the acceptable conditions specified. Besides,
no person shall, unless licensed, discharge or spill any oil mixture containing oil,
environmentally hazardous substances, pollutants or wastes into Malaysian waters in
contravention of acceptable conditions specified. Moreover, no person shall place, deposit or
dispose of, except at prescribed premises only, any scheduled wastes on land or into
Malaysian waters. Furthermore, no person shall, unless licensed, pollute or cause or permit to
be polluted any soil or surface of any land in contravention of the acceptable conditions
specified.
8.1.2.2 Environmental Quality (Clean Air) Regulations 1978
Under the Clean Air Regulation 1978, it stated that the standard for any trade,
industry or process which emits or discharges dust or any solid particles containing asbestos
or free silicas the concentration of air impurities.
8.1.2.3 Environmental Quality (Control of Emission from Diesel Engines) Regulations
1996
The regulations apply to every motor vehicle irrespective of whether it is in use or
stationary, or in any bus terminus, taxi stand or private premises or on any private road.

42
8.1.2.4 Environmental Quality (Control of Emission from Petrol Engines) Regulations
1996
Every motor vehicle irrespective of whether it is in use or stationary, or in any bus
terminus, taxi stand or private premises or on any private road shall follow the regulations
stated.
8.1.2.5 Environmental Quality (Sewage and Industrial Effluents) Regulations 1979
Under the Sewage and Industrial Effluents Regulations, it stated that no person shall
carry out on any premises that may result in a new source of effluent discharge or cause a
material change in quantity or quality of the discharge from an existing source or construct on
any land any building designed or used for a purpose that may cause the land or building to
result in a new source of effluent. Besides, no person shall discharge or cause or permit the
discharge of any inflammable solvent of into any, any tar or other liquids immiscible with
water and refuse, garbage, sawdust, timber, human or animal waste or solid matters into any
inland water.
8.1.2.6 Pesticides (Highly Toxic Pesticides) Regulations 1996
According to the Highly Toxic Pesticides Regulations, it stated that any person who
uses or causes to be used highly toxic pesticides shall either destroy & dispose of all empty
pesticide containers in a manner as specified on the highly toxic pesticide label or comply
with all instructions on the label on all containers of highly toxic pesticides or ensure that no
highly toxic pesticide to be used in residential or recreational places. Besides, no person who
uses or causes to be used any highly toxic pesticides at any place where there is a likelihood
or risk of contaminating the water supplies.

43
8.1.2.7 Earthwork By-law 1996
The law stated the siltation requirement for silt traps and sediment control facilities at
construction sites.
8.2 UNESCO
In the year 2001, Langkawi proposed to the Kedah government to be a geopark. On
May 2006, Langkawi was renamed Langkawi Geopark by the Kedah government and
declared by the federal government 4 months later. In June 2007, Langkawi Geopark get its
international geopark endorsement from the UNESCO, Global Geopark Network. However,
the UNESCO validation is a renewable contract that gets reassessed every four years. The
inspectors have to ensure that the geoparks follow the UNESCO guidelines. Langkawi
Geopark follows the guidelines and passed its renewal inspection in 2011 and 2015 (Vanessa
Workman, 2018). These guidelines focus on three main aspects which are conservation and
protection; research and education and sustainable development.
Langkawi Geopark was then designed to fulfil the criteria for a global geopark to
conserve natural and cultural heritage, education and sustainable development. The Langkawi
Development Authority (LADA) in collaboration with the Institute of Environment and
Development (LESTARI) of Universiti Kebangsaan Malaysia is in the process of preparing
the Langkawi Geopark Management Plan (LGMP). Recognising that geoparks are about
protection and conservation of land and sustainable development of land and land resources,
the approach taken for Langkawi Geopark is implementation through land use planning under
the Town and Country Planning Act 1976 (Act 172). (Hashim & Aziz, 2011)

44
9.0 Summary
As a summary, the proposed project is an hotel resort which is located in Kuah town,
Langkawi. The proposed constructed project which comprises of 4 storey high of building
with an indoor swimming pool. The suitable procurement method would be Design and Build
procurement method. This is due to D&B procurement method has a shorter construction
period compare to other procurement methods available. Therefore, we, have estimated the
construction time period for the building will be taken up to 3 years.
For the estimation part, it proved extremely profitable to the client as the estimation
above shows that within 20 years of the hotel resort of the building, the client will be able to
make a profit of RM 41,064,000.00. Besides that, this will facilitate the client in term of
finances on funding other projects which can lead him to a higher level of success. The
tourists in Langkawi have a chance to stay in such environment comfortable place to stay and
enjoy the facilities provided from the hotel resort.

45
REFERENCE
Audus, I., Charles, P., & Evans, S. (2010). Environmental good practice on site (third
edition).
CIDB. (2008). Compilation of Environmental Acts, Laws and Regulations Related to
Construction Industry. Engineering Conference (Vol. 2).
Hashim, H. S., & Aziz, R. A. (2011). Conservation with development: Showcasing Langkawi
Geopark-an introduction. Planning Malaysia, 9, vi–x.
Izzah. (n.d.). . Retrieved November 23, 2018, from
http://www.cidb.gov.my/index.php/en/cis-7-2014-sistem-penilaian-kualiti-untuk-kerja-
pembinaan-bangunan
Kyei, K. A. (2009). Procurement Systems and Project Success in Ghanaian construction
industry, Unpublished MSc. Thesis, Department of Building Technology, KNUST-Kumasi.
Lavanya, N. & Malarvizhi, T. (2008). Risk analysis and management: a vital key to effective
project management. Paper presented at PMI® Global Congress 2008—Asia Pacific, Sydney,
New South Wales, Australia. Newtown Square, PA: Project Management Institute.
Neumann, S. (1977). Risk Management: Concepts and Applications.
QLASSIC Assessor Accreditation Scheme (Step 3). (n.d.). Retrieved November 23, 2018,
from https://www.cidbholdings.com.my/wp-
content/uploads/2018/04/QLASSIC_ASSESSOR_ACCREDITATION_SCHEME_STEP3-3-
2.pdf
Rose, K. H. (2013). A Guide to the Project Management Body of Knowledge
(PMBOK® Guide)—Fifth Edition. Project management journal, 44(3), e1-e1.

46
Trett, D. (2015). Contractual arrangement.
https://my.tixuz.com/real-estate/sale/land/langkawi--
kedah/690687?utm_source=homes.mitula.my&utm_medium=referral
Vanessa Workman. (2018). Langkawi Geopark: What To Know Before You Go - The Island
Drum. Retrieved November 25, 2018, from https://www.theislanddrum.com/langkawi-
geopark-what-you-should-know-before-you-go/

47
APPENDIX
A: Building Cost from JUBM COnstruction Cost Handbook 2018

48
B: Electricity Tariff for Commercial by TNB as at 1 Jan 2014
C: Water Tariff for Commercial

Assignment 2 - Resort Proposal at Pulau Langkawi

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