Feasibility Study For a Hospital in Saudi Arabia Essay

Feasibility Study For a Hospital in Saudi Arabia - Essay Example 1.3 System Overview Responsible Organization Independent Research Foundation (IRF) is the responsible organization. IRF has conducted most of the surveys on their own as well as taken help from Government and Private Organization in establishing the feasibility. IRF is responsible for handling all the investment and making sure that all goes according to the plan. System Name Tabeeb Healthcare Facility System Code BJH-699-I2011 System Category ---- Major Application: General Health Care. The facility provides services of general nature but a Cancer Research facility will also be established. The hospital will be modeled after the famous Princeton Planes Borough Hospital (US). Diagnostics and Cancer research will be given special attention and investment. ---- General Support System: The Investors for this facility will mostly be from all over the world but the facility will provide services for all the locals. As there isn’t much insurance market strength in Saudi Arabia (comp aratively), there will not be much trouble in treating patients from all walks of life. Economic Analysis and Indicators Three economic indicators were used to analyze the investment for Tabeeb Health Care Facility; the Payback period of 2.5 years, NPV of US $20 million and ROI of 13%. The economic analysis shows that to raise capital for establishing the facility, IRF is in no position to raise the capital themselves. Therefore, the most likely sources of capital to all the above scenarios are grants and / or units owned by third parties, such as energy service companies (ie, through the contract or other similar contracts for energy services). As most of the foreign investment floods into Saudi Arabia in the form of oil sector development, our most likely sponsor will be any reputable oil company, preferably, Shell. Lifecycle costs of different scenarios were performed using the reputable software software (NRC 2005). Economic indicators to assess the economic viability were: a si mple payback period, NPV, and ROI. This type of analysis makes more sense as it will be simpler to present and more likely our sponsors will agree to our plan. Agencies typically grant funds by listing projects based on a simple payback period. For life cycle cost analysis, assumptions are made as follows: Projected Life 65 years Cost Inflation Rate 2.25% Discount Rate 7% Debt Term 15 years Interest Rate 4.7% Contingencies 4% (of capital costs) Cost (Energy) Savings 55%-98% 2.0 Market Analysis Recent Studies have shown an upward trend in the demand for health care facilities among the people of Kingdom. Population is increasing at a rapid pace but the health care facilities aren’t matching the population growth rate. Other than the fact that growth rate of health care facilities is not impressive in Saudi Arabia indicating that there will be an increase in the demand for doctors and nurses, everyone needs to see a doctor. Medical and health care facilities have an inelastic d emand. Investments in pharmaceuticals and medical facilities are often always considered an option that people go for. Tabeeb Health Care Facility will be built in the heart of the capital Riyadh. The patient statistics (as they are discussed below) were relatively easy to collect and we have a very good reason to believe that the data is as