"A Common Vocabulary for Asset Investment Strategy"
Author: Christensen, Douglas K., Rodney Rose, and Terry W. Ruprecht
Published In: Facilities Manager
Date: March/April 2007
Understanding the meaning of common terms and translating these terms into factors that apply to facilities investment decisions is fundamental to any asset investment strategy. Emphasizes the need to look at cost estimates for building projects in at least 3 ways: hard construction costs, soft costs estimated by the architect, and the owner's own costs. Describes the cost categories of birth and burial (one-time costs associated with the funding, planning, design and construction of a fixed asset as well as the removal of the asset from the organization's capital inventory); maintenance and operation; and recapitalization. Includes Life-Cycle Cost Category Comparison table.
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