Evaluating ancillary business scale for PPP-BOT projects: A social housing BOT case in Taiwan

Chih Yao Huang*, Ren-Jye Dzeng

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Due to budgetary constraints, the government releases the right to ancillary business development for private investors to increase profits in PPP projects. However, the ancillary business scale is not specified in the regulations, and there is little relevant research on modeling the scale. Thus, our research aims to create a model with mathematical analysis to evaluate the ancillary business scale. The model is constructed based on the discounted cash flow model to calculate the ancillary business scale attracting private investors with a case study of a social housing project. For this case, the calculated ancillary business minimum scale (ratio of ancillary business to project in total floor area) based on the 7-year (2009-2016) and 17-year (2000-2016) data are 30.81% and 52.79%, respectively; neither is able to meet the scale listed in the tender condition regulated by the government, i.e., 25%. Moreover, this study performs a sensitivity analysis on the expected rate of return and rent discount of the case. The government needs to raise the proportion of ancillary businesses or to increase the rent of social housing to successfully attract private investors.

Original languageAmerican English
Article number1415
JournalSustainability (Switzerland)
Issue number5
StatePublished - 1 Mar 2019


  • Ancillary business
  • BOT
  • PPP
  • Social housing
  • Taiwan


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