Budget assumptions

The Budget tab in Edit Assumptions sets every cost input behind the Development Budget. Change a field, then press Enter or click outside it, and Parafin refreshes the outputs. Each section below is one accordion in the tab.

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Land Acquisition

Enter the land cost per square foot or per acre. The model converts to a total using the site area.

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Hard Costs

Enter hard costs per gross square foot or per key. A Cost index toggle applies your location’s index to this figure. See Cost index.

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Soft Costs

Enter soft costs per gross square foot or as a percentage of Hard Costs. A Cost index toggle applies your location’s index to this figure. See Cost index.

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Cost index

Hard Costs and Soft Costs each carry a Cost index toggle: 1.00, or your project location’s index. At 1.00 the model uses the figure you entered. At the location index it multiplies that figure by the index. 1.16 adds 16 percent, 0.86 takes 14 percent off. The index compares construction cost in that market against the national average. It comes from RSMeans location cost data, loaded per city. The toggles are independent. On Soft Costs the index applies only to figures entered per gross square foot.

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Custom Budgets

Add a custom line, name it, and enter its amount. Custom lines flow into the Total Budget and can be included in the Developer Overhead & Fee and Contingency Allowance calculations.

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Developer Overhead & Fee

The percentage applies to the items you select: Land, Hard Costs, Soft Costs, Guestroom FF&E, and any custom lines.

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Contingency Allowance

Choose which cost lines the contingency applies to.

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Guestroom FF&E

Set a per-key FF&E budget for each room type in the mix.

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Construction Loan

For the outputs these inputs feed, see Reading your result tables.