This section is from the book "Building For Profit", by Reginald Pelham Bolton. Also available from Amazon: Building for Profit.
Of the total cost, the fixed equipment was 60% and the motive apparatus was 40% of the cost of the whole equipment.
The combined equipment has a relative life compared with that of its most durable part, which has been assumed to be such material as elevator guides and fixed ironwork, of 40%.
The fixed equipment has an average of..... | 52.0% |
But the motive apparatus is only....... | 21.8% |
The effect of the motive apparatus is, therefore, the greatest in reducing the total life of the building. The cost of the entire equipment in this case approximated 20% of the total cost, and if the building, upon dissection of its elements, should show, without equipment, a mean relative life of 77%, then the introduction of the equipment reduces the combination to 70%, or, in other words, the building alone would have a mean life of 57 3/4 years; but this would be reduced by the effect of the equipment to 52 1/2 years, involving on each one million dollars of total invested value an annual addition to the necessary sinking-fund for depreciation of about $7500 a year.
Fig. 13
In an office building where no power plant is installed, but elevators and heating-boilers are included, we find that the relative life of this equipment is......... 45.7% | |
The building without the equipment is...... | 77.0% |
and the effect of the equipment is to reduce this to . . | 74.7% |
In a dry-goods building the investment in the equipment and in a power plant was:
For the fixed equipment, elevators, sprinklers, and boilers for heating .... 20% of the cost of the building For the motive apparatus, or generating plant...... 6% of the cost of the building
The relative life of building alone being . . . . | 77.00% |
The relative life of fixed equipment is..... | 52.00% |
Thus the building and fixed equipment average . . | 73.00% |
The relative life of the motive plant is, however, only | 18.00% |
Reducing the average relative life of all to . . . | 70.25% |
and reducing the mean life of the whole by about . | 9.00% |
and increasing the proportionate sinking-fund by about .............. | 20.00% |
The introduction of delicate and short-lived machinery into buildings, therefore, affects not only the proportion of funds for its own replacement, but that covering the duration of life of the entire structure.
 
Continue to: