Aether Living — Financial Plan — Assumptions & Methodology
The financial-modelling methodology and the key assumptions — sales pricing and absorption, build costs, escalation, capital structure, tax and the macroeconomic inputs.
Section 14 · Business Plan
Financial Plan — Assumptions & Methodology
The financial-modelling methodology and the key assumptions — sales pricing and absorption, build costs, escalation, capital structure, tax and the macroeconomic inputs.
14.1 Modelling Methodology
The financial plan presented in Sections 15 through 19 is built on a
fully integrated three-statement financial model (profit and loss,
balance sheet, cash flow) calibrated against South African market
benchmarks, comparable peer disclosures, IFC EDGE-Advanced cost
estimates from the Green Building Council of South Africa, and bottom-up
cost modelling validated by independent quantity surveyors. The model
spans a ten-year forecast horizon (Year 1 through Year 10) with all
figures stated in nominal ZAR billion unless otherwise indicated.
14.2 Key Macroeconomic Assumptions
| Assumption | Year 1 | Year 5 | Year 10 |
|---|---|---|---|
| South African CPI Inflation | 4.5% | 4.5% | 4.0% |
| Construction Cost Inflation | 6.0% | 5.5% | 5.0% |
| Rental Escalation (CPI-linked) | 4.5% | 4.5% | 4.0% |
| Property Sales Price Growth | 5.0% | 5.0% | 4.0% |
| Prime Lending Rate | 10.0% | 9.5% | 9.0% |
| IFC Blended Debt Cost (all-in) | 8.4% | 8.4% | 8.4% |
| Commercial Bank Cost (all-in) | 11.2% | 10.7% | 10.2% |
| Effective Corporate Tax Rate | 27% | 27% | 27% |
| ZAR/USD Exchange Rate | R18.50 | R20.00 | R21.50 |
14.3 Operational Assumptions — Sales
| Sales Assumption | Value |
|---|---|
| Average Selling Price per Unit | R 1.65 million (blended) |
| Pre-sale Requirement before Construction | 35–40% per phase |
| Average Sales Velocity (units / month / precinct) | 85–120 units |
| Sales Commission (broker + internal) | 3.2% of selling price |
| Marketing as % of Revenue | 2.2% |
| Bond Approval Rate Assumption | 62% |
| Cancellation Rate Assumption | 8% |
14.4 Operational Assumptions — Rental & Infrastructure
| Operational Assumption | Value |
|---|---|
| Average Rental Yield (Gross) | 8.5% |
| Stabilised Occupancy Rate | 94% |
| Rental Vacancy at Lease-up | 18 months → 6 months stabilised |
| Energy Tariff (vs Eskom) | 12% discount |
| Energy Business EBITDA Margin | 42% |
| Water Tariff (vs Municipal) | Parity |
| Water Business EBITDA Margin | 28% |
| Connectivity ARPU per Resident | R 650 / month |
| Connectivity Attach Rate (steady state) | 74% |
| Estate Levy per Unit per Month | R 1,400 (escalating) |
| Retail Cap Rate | 8.5% |
14.5 Capital Cost Assumptions
| Capital Cost Item | Value |
|---|---|
| Construction Cost — Standard Unit | R 9,800 / m² (Year 1) |
| Construction Cost — Premium Unit | R 14,500 / m² (Year 1) |
| Solar PV Installation Cost | R 11.8 million / MW |
| Battery Storage Cost | R 6.2 million / MWh |
| Water Infrastructure (per ML/day) | R 78 million |
| Land Cost — Brownfield Metro | R 1,800–4,200 / m² |
| Professional Fees (% of construction) | 9.5% |
| Contingency Reserve | 8% |
Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of Aether Living Developments (Pty) Ltd.