American Journal of Economic and Management
Business
p-ISSN: XXXX-XXXX
�e-ISSN: 2835-5199
Vol.
3 No. 12 December 2024
Investment
Feasibility Study with the Capital Budgeting Method for the Construction
Project of Facilities for Overnight Parking Services at APT Pranoto Airport in
Samarinda City, East Kalimantan�
M. Thesar Hari Nugraha1*, Mentiana Sibarani2
1,2Sekolah Tinggi Ilmu Ekonomi Harapan Bangsa,
Indonesia
Emails: [email protected],
[email protected]
Abstract
The rapid
development of transportation infrastructure has significantly increased the
demand for vehicle parking facilities, particularly at strategic locations such
as APT Pranoto Airport in Samarinda, East Kalimantan. This study evaluates the
investment feasibility of constructing an overnight parking facility at the
airport. Using a qualitative descriptive approach, financial analysis
methods�including Net Present Value (NPV), Internal Rate of Return (IRR),
Payback Period (PP), and Profitability Index (PI)�were applied. Primary data
were collected through interviews with project managers and airport officials. The
findings indicate that the current parking facilities are insufficient to meet
demand, especially during peak seasons. Financial feasibility tests confirmed
the project�s viability, with positive NPV values, an IRR surpassing the
required rate of return, a PI exceeding 1, and a short payback period. These
results demonstrate the project�s potential profitability and its ability to
enhance service quality. Consequently, this investment is recommended as a
sustainable initiative to support the airport�s increasing transportation needs
and promote operational efficiency.
Keywords: APT Pranoto Airport, capital
budgeting, financial analysis, �investment feasibility, overnight parking.
INTRODUCTION
In the context
of globalization and rapid economic development, the availability of adequate
supporting infrastructure, such as parking facilities, is critical,
particularly in strategic transportation hubs like airports
The airport
has witnessed substantial passenger growth in recent years, driven by the
economic and tourism development in the province of East Kalimantan
In line with
the increasing number of passengers, APT Pranoto Airport has allocated a
sizable parking area of 30,000 m�. As part of its 2024 development plan, the
airport is set to introduce a new service: overnight parking for visitors,
spanning an area of 2,046 m�. This service aims to cater to the needs of
four-wheeled vehicle users seeking extended parking options, enhancing
convenience for long-term users
Currently,
Samarinda A.P.T Pranoto Airport faces significant limitations in providing
adequate in-parking services, as the existing parking area is exposed to heat
and rain, potentially leading to vehicle damage. This situation not only
inconveniences passengers but also risks harming the airport's reputation.
Recognizing this challenge, PT Kaltim Melati Bhakti Satya (Perseroda), a
Regional-Owned Enterprise (BUMD) of East Kalimantan Province, plans to
undertake strategic business development to enhance its portfolio by managing
parking lot services at A.P.T Pranoto Samarinda Airport. This initiative aims
to provide safer and more comfortable parking facilities, thereby improving
customer satisfaction, boosting the airport's reputation, and creating new
revenue streams. Additionally, the development is expected to contribute to the
regional economy by setting a benchmark for modernized parking services and
fostering opportunities for local businesses
Based on the
description of the background above, the problems of this research can be
formulated are: "How is the investment feasibility analysis of the
construction of facilities for the parking lot service business at the apt
proto airport." The objectives of this study are 1) To determine the
feasibility of investing in the construction of facilities for the overnight
parking service business at apt proto airport.
RESEARCH METHODS
The research employed a
descriptive qualitative approach, with the discussion presented in the form of
descriptive data. The study utilized methods such as net present value,
internal rate of return, payback period, and profitability index to analyze the
data. To ensure the reliability and validity of the results, the researchers
collected both primary and secondary data. Primary data were gathered through
interviews with relevant project managers and officials at the Apt Pranoto
Airport public service agency. These interviews were conducted to ensure the
adequacy of data required for analyzing the feasibility of the Supporting
Facilities development project at Apt Pranoto Airport, Samarinda City, managed
by PT Kaltim Melati Bhakti Satya. A deeper consideration of potential biases,
challenges, and limitations encountered during the research process would
further strengthen the methodology section
RESULT AND DISCUSSION
Passenger and Air Traffic
Data
Based on the data obtained
from the APT Pranoto Class I Airport Operator Unit Public Service Airport, the
monthly number of recorded aircraft passengers during the research period is
summarized and analyzed in the following section, accompanied by detailed
visual representations such as graphs or tables to enhance accessibility and
comprehension.
Table 1.
Number of Passengers
|
|
Historical |
|||
|
Keterangan |
2020 |
2021 |
2022 |
2023 |
|
Passanger/Year |
572.918 |
490.737 |
728.501 |
752.913 |
|
Growth
(CAGR) Passanger |
|
-14,3% |
48,5% |
3,4% |
|
Visitor/year |
20.682 |
17.216 |
26.299 |
27.180 |
|
Visitor/Months |
1.724 |
1.476 |
2.192 |
2.265 |
|
Visitor/days |
57 |
49 |
73 |
76 |
|
Growth (CAGR) Visitor |
|
-14,3% |
48,5% |
3,4% |
This data
is important for assessing parking capacity needs and for planning more
efficient parking space management in the future, as there has been a surge in
the number of passengers flying using the facilities at APT Pranoto
Figure 1. Field observation graph
Table 2
above is a field observation and interview with the main parking lot manager
conducted during April 2024; it was found that an average of 2,131 airplane
passengers would generate about 62-81 units of vehicles per day that require
parking spaces taken in the past month.
Table 2. Projected
number of users of parking facilities at APT Pranoto Airport
|
Information |
Projection |
||||
|
2024 |
2025 |
2026 |
2027 |
2028 |
|
|
Passanger/Year |
778.143 |
804.219 |
831,168 |
859.020 |
887.806 |
|
Growth
(CAGR) Passanger |
3,4% |
3,4% |
3,4% |
3,4% |
3,4% |
|
Visitor/year |
28.091 |
29.032 |
30.005 |
32,011 |
32,050 |
|
Visitor/Months |
2.341 |
2.419 |
2.500 |
2.584 |
2,671 |
|
Visitor/days |
78,03 |
81 |
83 |
86% |
89 |
|
Growth (CAGR) Visitor |
3,4% |
3,4% |
3,4% |
3,4% |
3,4% |
Table 2 above shows the projected number
of users of parking facilities at APT Pranoto Airport. It can be seen that the
number of long-term parking users is expected to increase each year, with an
average growth of around 3.4% per year. This can be attributed to the
increasing number of flights operating, which is likely to lead to an increase
in the number of passengers and vehicles using the parking facilities over the
next five years
Analysis of Parking Capacity Limitations and Impacts
In April-June or
December (during Lebaran and Nataru), when the volume of vehicles increases
sharply, there is congestion in the parking area, causing passengers to have
difficulty finding available parking spaces. This has the potential to cause
delays in the check-in process and flights, as well as create inconvenience for
passengers
Based on existing
data, the parking capacity at APT Airport can only accommodate around 500
vehicles at its maximum capacity. Therefore, to cope with the surge of
vehicles, additional parking areas or the development of more efficient parking
systems, such as automated parking or more intensive use of public
transportation during peak periods, are required.
Aircraft Parking Lot Construction Cost Requirement
Analysis Based on Air Traffic
Based on the air
traffic data presented in Chapter 4.1, the number of passengers and aircraft
movements at APT Pranoto Airport continues to increase. In 2023, APT Airport
recorded 752,913 passengers per year. Projections show that the number of
aircraft movements will increase to 887,806 per year by 2028, in line with the
increasing need for air transportation.
Construction Cost of Inpatient Parking Lot
This parking lot
construction cost calculation provides a clear picture of the budget
requirements in the construction project. With a cost of approximately IDR
2,000,000,000 (two billion rupiah) for the airport's in-parking lot, this is an
important component in the overall project budget plan.
Table 4. Calculation of
Inpatient Parking Fee
|
No |
Type
of work |
Sum |
|
|
Making an
INAP parking roof |
|
|
A |
Preparatory work |
|
|
I. |
Preliminary work |
86,014,563,50 |
|
II. |
Occupational health safety
management system |
13,505,000,00 |
|
B |
Making a parking roof |
|
|
I. |
Concrete work |
14,949,419,32 |
|
II. |
Ironwork |
847,382,835,50 |
|
III. |
Roofing work |
335,313,775,12 |
|
IV. |
Electrical installation work |
44,505,000,00 |
|
C |
Construction of the Posjaga |
|
|
I. |
Preparatory work, market and land |
1,125,378,40 |
|
II. |
Reinforced concrete cast work |
4,754,733,77 |
|
III. |
Wall and plaster pairs |
6,943,980.03 |
|
IV. |
Work on window frames and doors |
8,287,281,34 |
|
V. |
Floor and wall covering work |
4,743,553,12 |
|
VI. |
Easel and roof work |
5,464,202,00 |
|
VII. |
Frame work & ceiling cover |
3,237,701,39 |
|
VIII |
Pekerjaan
Cat-Catan |
218,186,873 |
|
IX |
Electrical Installation Work |
3,675,000,00 |
|
X |
Other jobs |
12,020,000,00 |
|
D |
General Tolilet Development |
|
|
I. |
Sand and soil preparation work |
812,689,20 |
|
II. |
Foundation Work |
4,132,357,14 |
|
III. |
Reinforced concrete cast work |
3.499.010.07 |
|
IV. |
Pairing dinging and plastering |
6,163,589,66 |
|
V. |
Work on window frames and doors |
3,057,217,50 |
|
VI. |
Floor and wall covering work |
4,446,112,98 |
|
VII. |
�Horse and roof workman |
3,047,693,41 |
|
VIII |
Frame workers and ceiling covers |
1,556,988,84 |
|
IX |
Paint work |
1,764,933,20 |
|
X |
Electrical installation workers |
800,000,000 |
|
XI |
Sanitation workers |
12,275,000,00 |
|
E |
Drainage Creation |
|
|
I |
Preparatory work |
37,595,742,04 |
|
II |
Spouse work |
245,420,034,64 |
|
F |
Pedestrian work |
19,332,866,53 |
The table above presents the estimated
cost of building parking facilities at the airport, which is compiled based on
the results of a study from an independent consultant. The preparation of this
table aims to provide a detailed description of the allocated costs, including materials,
labor, and other operational needs. (details can be seen in the attachment). The
cost estimation table prepared by the consultant shows that the calculation has
considered various crucial factors so that it can be a valid basis in the
decision-making process of this project
Analysis of the Relationship between Air Traffic and
the Cost Requirement for the Construction of a Parking Lot
In operational cost analysis, there are
two main categories that need to be considered, namely fixed costs and variable
costs. These two types of costs play a very important role in determining the
operational efficiency and sustainability of infrastructure development in the
aviation sector
Fixed
Cost
Fixed costs are costs that do not change
with changes in air traffic volume or other operational activities. In the
context of an airport or air facility, these fixed costs include various
expenses that must be incurred each period, regardless of how many aircraft
operate or how many passengers are served
Variable
Cost
While fixed costs are constant, variable
costs are those that change according to the volume of operations and facility
requirements
The Effect of Cost on Infrastructure Development
The distinction between fixed and variable
costs provides important insights into financial management for infrastructure
development. Large fixed costs, such as land rent and employee salaries, need
to be carefully considered in long-term plans. Variable costs, while more
flexible and adaptable to operational volumes, should be closely monitored to
ensure that increased activity does not lead to uncontrolled cost overruns
Estimated Operating Costs and Revenue Generated
Table 5. Estimated Operating
Costs and Revenue Generated
|
No |
Cost Structure |
Moon |
Year |
Total |
|
||
|
1. |
Fix Cost |
Land lease 2049 M2 |
Rp 30.690.000 |
Land for rent
2049 m2 |
Rp. 368.280.000 |
Rp. 536.280.000 |
|
|
Employee salary (4 Orang) |
Rp. 14.000.000 |
Employee salary |
Rp. 168.000.000 |
||||
|
2. |
Variable Cost |
Internet |
Rp. 1.500.000 |
Internet |
Rp. 18.000.000 |
|
|
|
Therapy |
Rp. 1.500.000 |
Therapy |
Rp. 18.000.000 |
|
|||
|
Electricity
& Water |
Rp. 2.000.000 |
Electricity & Water |
Rp. 24.000.000 |
|
|||
|
Liability
insurance costs |
Rp. 2.000.000 |
Liability insurance costs |
Rp. 24.000.000 |
|
|||
|
Depreciation
Expense |
Rp. 17.815.204 |
Depreciation Expense |
Rp. 231.782.448 |
|
|||
|
BLU
Profit Share 15% |
Rp. 35.113.705 |
BLU Profit Share 15% |
Rp. 421.364.460 |
|
|||
|
CP
Profit Share 25% |
Rp. 52.679.557 |
CP Profit Share 25% |
Rp. 632.154.684 |
|
|||
|
Sub Total |
Operating Exp/Month |
Rp. 157.289.466 |
Operating Exp/Year |
Rp. 1.887.473.597 |
|
||
|
|
|||||||
|
|
Sewa + bagi hasil BLU |
Rp. 65.803.705 |
Rent + BLU Profit Share |
Rp. 789.644.458 |
|
||
|
CP Profit Sharing |
Rp. 157.289.466 |
CP Profit
Sharing |
Rp. 632.046.687 |
|
|||
The table
presented above details the estimated operating costs involved in the
construction and management of an on-airport parking facility. These estimates
are divided into several interrelated categories. Each of these cost categories
has been carefully calculated to provide a comprehensive overview of the budget
required for this project.
Payback Period (PP) Test Results
Table 6. Payback results
|
Year |
Cash
flow |
Cumulative
Cash Flow |
|
0 |
(1.929.189.460) |
(1.929.189.460) |
|
1 |
426.930.701 |
(1.502.258.759) |
|
2 |
511.650.001 |
(903.050.521) |
|
3 |
599.208.237 |
(213.349.8980) |
|
4 |
(689.700.542) |
476.350.562 |
|
5 |
783.225.235 |
1.259.575.796 |
However, keep in
mind that this payback period method has limitations; this method does not take
into account the time value of money and only focuses on the return on the initial
investment without considering the cash flow that occurs after the payback
period. Therefore, it is recommended that further analysis be conducted using
other methods such as net present value (NPV), internal rate of return (IRR),
and profitability index (PI) to get a more comprehensive picture of the
business feasibility of this project.
Net Present Value (NPV) Test Results
The NPV
calculation is carried out using a discount rate that reflects the rate of
return expected by investors, which is 10%. In addition to the basic NPV
calculation, a sensitivity test to changes in the discount rate was also
conducted to find out how much influence these changes have on the NPV results.
In this sensitivity test, the discount rate was tested at 10%, 12%, 15% and
20%. The results can be seen in the table below:
Table 7. Sensitivity Test Results
|
Cost Of Capital (r) / MARR |
10% |
NPV |
Rp. 289.370.612 |
|
12% |
NPV |
Rp. 169.127.697 |
|
|
15% |
NPV |
Rp. 6.664.567 |
|
|
20% |
NPV |
Rp. (223.966.478) |
A negative NPV
result at a 20% discount rate indicates that the project is less financially
viable, assuming such a high rate of return. This indicates that the project
may face greater risks or the expected revenue projections are not sufficient
to cover investment and operating costs at the requested rate of return.
Internal Rate of Return (IRR) Test Results
The IRR is the discount rate at which the
NPV equals zero, meaning that the present value of the cash flows generated by
the project is comparable to the initial investment cost. In practical terms,
IRR can be used to determine whether a project can provide a return large
enough to cover the investment costs and provide a profit for investors.
The
IRR formula =
The results of the calculation of the
internal rate of return (IRR) can be seen in the figure below:
Figure 2. Calculation Results of Internal
Rate Return (IRR)
This IRR value indicates that the project
can provide a rate of return of 15.13% per year on the investment made. By
comparing this IRR value with the discount rate used in the NPV calculation
(i.e. 10%), it can be said that this project has a higher rate of return than
expected by investors, which usually ranges from 10% to 15% for similar
investment projects. This indicates that this vehicle parking lot development
project has good profit potential and is feasible from a financial return
perspective
Profitability Index Test Results
The Profitability Index is one of the
important indicators in assessing the feasibility of an investment, which is
calculated by comparing the present value of expected cash flows with the
initial project investment.
The
formula for calculating the Profitability Index is as follows:
CONCLUSION
Based on the calculations conducted in the previous chapter, it can be
concluded that the investment in the construction of a vehicle parking facility
at APT Pranoto Airport Samarinda, managed by PT KMBS, is financially feasible
and highly promising. The evaluation of investment feasibility�using NPV, PI,
IRR, and Payback Period�indicates that the project has the potential to deliver
substantial long-term benefits for investors. With a relatively fast payback
period, a positive NPV, a high IRR, and a PI greater than 1, this project not
only ensures the recovery of the initial investment but also provides significant
added value for stakeholders.
To enhance its impact, the study highlights the potential of the project to
contribute to operational efficiency and facility improvements at APT Pranoto
Airport, thus supporting the airport's overall growth and service quality.
Future research could explore the broader economic and social implications of
this project, such as its role in supporting regional development or addressing
parking congestion challenges. Policymakers and stakeholders are encouraged to
consider these findings to maximize the project's contributions to the
community and the transportation sector.
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Copyright holders:
M. Thesar
Hari Nugraha, Mentiana Sibarani (2024)
First publication
right:
AJEMB - American
Journal of Economic and Management Business