1.01, 1.02 introduction to real estate project management 1
TRANSCRIPT
Trainings by Vidya Bhagwat
Chetan Thakre
PMP, BE, MBA, PGDPC
Real Estate Project Management
Facilities Management Construction Management
Residential Commercial Retail Hospitality Industrial
Effective Project Management
Indian Real Estate Success Stories
OBEROI REALTY
Target : The firm has carved a niche for itself in the Mumbai market with upper end of the market segment.
Strategy : The company extensively out-sources work to leading international and domestic consultants in the areas of architecture, design, engineering and construction to achieve international quality and styling
Indian Real Estate Success Stories
SOBHA DEVELOPERS
Target : residential projects for families and contractual projects for corporate, especially in the south market.
Strategy : This means that the company has in-house possession of most of the competencies and resources required to deliver a project from conceptualisation to completion. Backward integration includes an interiors division with one of the country’s largest wood working factory, a metal works and glazing factory, and a concrete products factory. These help it to lock in higher margins end-to-end by achieving cost efficiencies.
ASHIANA HOUSING
Target : The company mainly focuses on group housing for the middle-income group and retirement communities for senior citizens in Tier-2 and Tier-3 cities such as Jamshedpur, Jaipur, Bhiwadi and Ghaziabad.
Strategy : Ashiana Housing is near debt-free firm in the real estate sector that records high return ratios. The company’s business model is based on five strategies — low capital employed, land is raw material, in-house construction capabilities, direct sales team and facilities management.
Indian Real Estate Success Stories
Key Drivers For Professional Approach For Real Estate Project Management
Growing customer expectations
Industry competition and external pressure
Shift from unorganized to organized industry
Entry of foreign players
Inner Drive To Grow
COMMON THREAD Market focus
Successful execution of projects consistently in line with corporate strategy.
Strong brand association and trust that they share with their target customers
Indian Real Estate Success Stories
Consistent Project Execution In Line With Corporate Strategy Is Key For Successful Real Estate Company
Why You Must Take This Course
Concepts: Project management is the backbone of any real estateindustry. Hence you are directly or indirectly responsible for projectsuccess in your organization.
Uniqueness: Project management processes are different fromconstruction management (technical processes). As a good realestate professional, you must have knowledge both areas.
Interdependence: Project is series of several inter-dependent tasks.You might be responsible for certain task(s) but your actions havewider implications on the project. You must clearly understand thismany to many relationship.
Best Practices: This course material is based on PMI’s ® (ProjectManagement International) best practice framework. This globallyrenowned and widely successful project management methodology.It will give you clear understanding all dimensions of real estateproject management.
How This Study Material Is Going To Help You
This program trains you for leadership in managing real estate and construction projects. You will have far superior project management knowledge than those who have not completed this course. Some of the key benefits :
Effective project phasing to have better management control
Developing work plan and managing resources (time, budget,
information and project staff)
Controlling quality
Effective risk management
Effective allocation of responsibilities and monitoring work
Effective site organization and administration
Effective people management and managing team dynamics
Program Content
Module 1 Fundamentals Of Real Estate Project Management
Chapters
01 Real Estate Project Management Scenario In India
02 Introduction To Real Estate Project Management
03 Project Management Process Groups & Knowledge Areas
Program Content
Module 2 Essential Knowledge Areas For Real Estate Project Management
Chapters
04 Integration Management : One View For Project Success
05 Scope Management : Delivering Promise
06 Time Management : Managing Delays
07 Cost Management : Managing Money
08 Quality Management : Gateway For Customer Satisfaction
09 HR Management : Managing People On Project
10 Communication Management : Right Information At Right Time
11 Risk Management : Proactive Issue Management
12 Procurement Management : Effective Supplier Management
13 Stakeholder Management : Managing People Influencing Project
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Chapter 1 Real Estate Project Management Scenario In India
Current status of real estate & construction industry in India
The second largest economic activity after agriculture and provides employment to about 33 million people
India's Construction industry has grown at a Compounded Annual Growth Rate (CAGR) of about 11.1% over the last eight years
Massive infrastructure investment and rapid rise in housing demand are prime movers
Source: Economic Survey 2008-09 and IMaCS analysis
Profile of people employed in the Building, Construction and Real Estate Sector
Forecasted Demand Of Project Management Professionals In Indian Construction Sector
Project management practices in Indian Real Estate and Infrastructure sector are not well developed . Hence the project delivery performance is also low.
Project Success Rate Of Various Key Industry Sectors In India Against Scope, Schedule & Budget
Key Reasons For Failure / Delays In Various Industry Sectors In India
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Chapter 2
Introduction To Real Estate Project Management
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What Is Project ?
Project is a temporary endeavour undertaken to create a uniqueproduct or service.
• Example : construction of building, construction of fencing ,
installation of facilities management .
• But maintenance work for the building or facilities
management is not project but called operations
management
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The temporary nature indicate that a project has
definite beginning and end. Hence meeting dead
lines is extremely important for project success
Temporary dose not necessarily mean that the
project is short. Duration of project depends on
scope and complexity
Temporary dose not refer to product , service or
result created by project.
You can apply learning of this program to any project
management task you are doing in professional or
personal life
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Project
Projects
To attain its objectives and
terminate
Start and end date
Operations
To sustain the business
Ongoing
Example
Construction of new
building
Example
Selling apartments in the
building
Strategic Management
Project Management Operational Management
Acquire tools for creation & augmentation of organization value. Bestow tools to worthy
persons to generate profit
Create Desired Value For The Organization Use created value to generate profit & revenue
Three Main Functions In An Organization
Real Estate Project Management is the application of knowledge,
skills, tools and techniques to execute projects effectively.
Project management processes: These processes ensure the effective flow of the project throughout its life cycle.
Ex : Building design & planning must be done before construction
Product oriented processes : These processes specify and create the project’s product. These processes vary by application areas as well as the phase of product life cycle.
Ex. All structural and engineering aspects must be taken into account while designing a building
What Is Real Estate Project Management
Key Project Management Skills
Knowledge : refers to what project manager knows about project management and real estate product management
Performance : refers to what project manager is able to do or accomplish while applying project management knowledge
Personal : refers to project manager’s behaviour when performing the project related activities includes attitudes, personality etc
Interpersonal skills : refers to project manager’s ability to communicate and manage other stake holders
How To Manage Projects Of Different
Complexities
Project Management Small companies managing one or few independent projects at a time.Example – Construction of single building
Program Management
Example - Multiple Projects In A Township"Live the dream“ – DSK Dream City
Program Management is the process of managing several related projects, often with the intention of improving an organization's performance
The action related to these interdependencies may include
• Resolving resource constraints
• Aligning organizational / strategic direction
• Resolving issues and change management
Program Management
Portfolio Management Example - Company Projects Under Various Categories i.e. Residential, Commercial, Industrial , FM etc “Highest quality standards for project execution, materials and services, collaborates only with the best-in-class associate” -Godrej Properties
Portfolio refers to projects, programs , sub portfolios and operations managed as a group to achieve strategic objectives.
The projects and programs or projects of a portfolio may not necessarily interdependent or directly related.
Focuses on ensuring that projects and programs are reviewed to prioritize resource allocation and that the management of portfolio is consistent with and aligned to organizational strategies
.
Portfolio Management
Project Management Office (PMO)
The project management office is a management structure that standardizes the project related governance processes and facilitate sharing of resources , methodologies, tools and techniques.
The primary function may include but not limited to
• Managing all shared resources
• Identify and developing project management methodology, best practices and standards
• Coaching, mentoring, training
• Coordinate communication across projects
• Role : supportive or controlling or directive
Project Management Office
Portfolios, Programs And Projects
PMO
Effective project governance assures constancy in project delivery and quality.
It is an oversight function that is aligned with organization’s governance model and that encompasses the project life cycle.
Example : Company which deliver very high end premium projects will need to make sure that all activities starting from contacting customer, quality of construction up to delivery of the property to customer must follow same high class standards
Importance Of Project Governance
Project governance framework includes
Construction quality acceptance criteria for contractors
Process to identify , escalate & resolve the issues
Formalizing relationship among project team & stakeholders
Project organization chart with well-defined project roles
Processes &procedures for communication
Project change control processes
Guidelines for aligning project governance and organizational strategy
Project life cycle approach
Organizational Influences On Project Management
As projects is delivered by project team using organizational resources, the organization has significant influence on project.
Ability of project team to deliver project successfully is influence by four factors
Organizational Influences On Project Management
Organizational Cultures And Style
Organizational Structures
Organizational process assets (OPAs)
Enterprise Environmental Factors (EEFs)
Organizational Cultures And Styles Shared visions, mission, values & beliefs Ex. Autocratic vs
inclusive management styles
Management cultureEx. Structured vs ad-hoc
Motivation and reward systems Ex. Employee as assets
vs employee as headcount vs mixed
Risk tolerance Ex. Early adopters vs followers of new
ideas
View of leadership, hierarchy & authority
Code of conduct and work ethics
• Organizational Communication Processes
PM AuthorityResource Availability
Project Budget Managed By
PM Role PM Admin Staff
Little Or None Functional Mgr Part Time
Organizational Structure : Functional
PM AuthorityResource Availability
Project Budget Managed By
PM Role PM Admin Staff
Little Or None Functional Mgr Part Time
Organizational Structure : Weak Matrix
PM AuthorityResource Availability
Project Budget Managed By
PM Role PM Admin Staff
Low To Moderate Mixed Full Time Part Time
Organizational Structure : Balanced Matrix
PM AuthorityResource Availability
Project Budget Managed By
PM Role PM Admin Staff
Moderate To High Project Mgr Full Time
Organizational Structure : Strong Matrix
PM AuthorityResource Availability
Project Budget Managed By
PM Role PM Admin Staff
High To Almost Total Project Mgr Full Time
Organizational Structure : Projectised
Organizational process assets (OPA)are the plans , processes, policies, procedures and knowledge bases used by performing organization.
Processes And Procedures : How to effectively manage current project
Corporate Knowledge Base : Stored information from previous projects
Use OPAs to improve the management of your project.
OPAs are often updated for future projects and also in the current projects.
Organizational Process Assets
EEF refers to condition not under the control of project team, that influence, constrain or direct the project. EEF are considered as inputs in most of the planning processes.
Internal or External
Positive or negative influence on the outcome
It is very difficult to change EEF during the course of your project.
You manage project within the constraint and guidelines established by the EEFs
Enterprise Environmental Factors (EEFs)
These include All industry and/or government standards
Company or organization infrastructure
Human resource guidelines and policy.
Authorization systems and guidelines.
Market and overall economic conditions.
Risk tolerance of stakeholders
Political climate
Technology available
Enterprise Environmental Factors
Important Enterprise Environmental Factors & Impact On Real Estate Construction Project Management
Trends – Market Expectations
More open spaces and efficient storage space
The great outdoors and amenities
Smart fittings for residential properties and multi purpose commercial properties
Energy efficiency and green construction
Semi-permanent modular construction
Safe construction
Increased specialization among builders
Joint ventures with land owners and investors to share risk and rewards
Modular construction
Trends -Property Demand & Supply
Impacts pricing and fund flow for project Property location plays important role Future market forecast is important
The government’s to relax FDI rules in the construction sector will increase competition and improve professionalism. FDI in the sector is estimated to grow to USD25 billion in 10 years
Rapid urbanisation bodes well for the sector . The number of Indians living in urban areas will increase from the current 377 million to about 600 million by 2031
India’s construction market is expected to be the world’s third largest by 2020. India construction market is expected to more than double to USD649.5 billion by 2020 from USD360 billion in 2010
Trends - Property Demand & Supply
Advancement In Construction Technology
Impacts
Designs
Methods Used For Construction
Material Used
Equipment Used
Using technologically advanced material in addition to conventional building material with following key considerations: Energy efficient Earthquake resistance Fire resistance Resistant to other natural calamities Environment friendly Good heat and sound insulation Versatility in constructions Rapid installation Lightweight but strong Minimal man power for construction Cost effective
Advancement In Construction Material
Few examples Fly ash bricks Building system using steel mesh, polystyrene core and
chipping concrete Technology using expanded steel mesh panels, polystyrene
beads & alleviated concrete Pre-stressed precast prefab technology using hollow core
slab, beams, columns, solid walls, stairs, etc Monolithic concrete technology using plastic form work Precast concrete panel Gypsum plaster reinforced with glass fibers building system
technology
Advantages of utilizing the modern construction equipments:
Increase the rate of output through work progress with the best effective and efficient methods.
Reduce the overall construction costs especially for large contracts.
Carry out activities which cannot be done manually or to do them more economically and much faster.
Eliminate the heavy manual work by human thus reducing fatigue and eliminates various other hazards and health issues.
Maintain the planned rate of production where there is a shortage of skilled or unskilled labor.
Maintain the high quality standards often required by present-day design and specifications (technical standards).
Advancement In Construction Equipments
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Few Important Types Of Construction Equipments
Earthwork Equipments
Concreting Equipments
Hoisting Equipments
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Examples Of Earthwork Equipments
Backhoe
Front Shovel
Dozers
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Examples Of Concreting Equipments
Concrete Batching And Mixing Plant
Concrete transit mixers`
Concrete pumps
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Hoisting Equipments
Boom Hoist
Tower Cranes
Mobile Cranes
Factors Behind The Selection Of Construction Equipments
Economic Considerations : Fund flow, cost vs benefits
Builder’s Organizational Readiness : Skills available to manage new technology, builder’s risk apatite
Site-Specific : Local availability of equipments and material , continuity of operation, weather conditions
Labour Consideration : Availability of right contractor
Company can acquire a construction plant and equipment through
Outright purchase : Long term use, long-term tax benefits
Renting : To meet short-term need to fill in for peak periods, special projects, or broken machinery
Leasing : An attractive option if equipment is needed for long term but don’t have the resources to purchase equipment outright
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Green Buildings
Green building management refers to a structure that meet certain standards for reducing natural resource consumption and uses process that are resource-efficient throughout a building's life-cycle.
Efficiently using energy, water, and other resources
Reducing waste, pollution and environmental degradation
Effective management of waste
Restoration and protection of environmental quality
Enhancement and protection of health and indoor environmental quality for occupants
Reinforcement of natural systems
Internationally, voluntary building rating systems have been instrumental in raising awareness and popularizing green design. However, most of the internationally devised rating systems have been tailored to suit the building industry of the country where they were developed. In India a US based LEED (Leadership in Energy and Environmental Design) rating system is under promotion by CII Green Business Centre, Hyderabad which is more on energy efficiency measures in AC buildings.
Keeping in view of the Indian agro-climatic conditions and in particular the preponderance of non-AC buildings, a National Rating System -GRIHA has been developed which is suitable for all kinds of building in different climatic zones of the country. The system was initially conceived and developed by TERI (The Energy & Resource Institute) as TERI-GRIHA which has been modified to GRIHA as National Rating System
Green Building Standards In India
Green Rating for Integrated Habitat Assessment (GRIHA)
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Chemical
Physical
Biological
Ergonomic
Construction Health and Safety
Awareness about health and safety is growing among Indian real estate players. Also the regulations are becoming more stringent. Following are key health and safety areas which should be taken into account while managing projects
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Chemical Hazards
Protection against
Dusts, fumes, fibers (solids) : asbestos, lead, silica, cadmium
Liquids, mists : spray paints, cutting oil mists, solvents, cleaning acid
Gases, vapors : welding fumes carbon monoxide
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Physical Hazards
Following are some examples of physical hazards Noise
Vibration
Temperature extremes and other adverse whether conditions
Locations with history of unrest
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Biological Hazards
Exposure may occur during demolition, renovation, sewer work, work on air handling systems, or other construction work from contact with contaminated or disease-carrying Soil
Water
Insects (mosquitoes, ticks)
Bird, bat droppings
Animals
Structures
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Ergonomic Hazards
Ergonomic hazards can cause painful and disabling injuries Ex Musculoskeletal Disorders (MSDs) . This following situation may causes these injuries:
Heavy, frequent, or awkward lifting
Repetitive tasks
Awkward grips, postures
Using excessive force, overexertion
Using wrong tools for the job or using tools improperly
Using improperly maintained tools
Hand-intensive work
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Other Health Hazards
Living conditions and welfare facilities
Temporary accomodation
Food
Drinking water
Sanitary conveniences
Facility for clothing
Work related mental stresses
Alcoholism and drug addiction
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Health & Safety Precausions
Meeting legal requirements
Eye protection
Respiratory protection
Ear protection
Face protection
Head protection
Hand protection
Foot protection
Body protection
Fall protection
Adequate breaks
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Direct costsThe direct costs are insurance. These include medical costs and others workers’ compensation insurance benefits as well as liability and property-damage insurance.
Indirect costs Logistics cost to manage injured person Wages paid to injured worker for time not worked Cost incurred because of delays which resulted from accident Loss of efficiency and moral of other workers Costs for clean-up, repair or replacement and stand-by costs
Health & Safety : Costs Of Non-adherence
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Reactive measures
Accident recording & reporting
Accident investigations
Proactive measures
H & s safety policy
H & s safety programme/plan
H & s safety induction/training
Health & Safety : Action Plans
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IT systems play critical role in all the following areas related to Real Estate Project Management
Structural And Architectural Design
Project Scheduling
Site Operations Management
Communication Management
Financial & Head Office Integration
Customer Relationship Management
Use Of Information Technology In Real Estate Project Management
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Many Real Estate companies are adopting construction project management software to Real time information for effective operational and cost control
System document management for effective communication management, access control and management information systems
Process standardization and effective governance
System options for real estate companies :
• Customized in-house system : Can be developed as per company needs but not scalable. Good for small companies
• ERP Systems : Costly but scalable, good for big companies Ex. SAP, Oracle
• Construction Specific Software : Designed for construction industry Ex. Projectmates, BuildTools Construction
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Project Management Software
• There are a number of project management software tools available to help in the planning and control of large software development projects. – E.g. MS Project is a CASE software tool for Project Management– This software is available in the main computer room in CSIT
• Most tools include functions to plan, schedule and control, butdecision-making still has to be done by the project manager.
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Project Management Software
• Benefits of project management software:– Calculate project schedule– Resource smoothing – Automatic generation of reports and charts
• Limitations of project management software– Allocation of resources to tasks– Estimation of tasks durations– Make decisions
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Project Scheduling Software
Helps to define, manage, monitor and control project schedule. Also help to evaluate project scope and cost performance with respect to schedule. Ex. MS Project
Key Features Of Scheduling System:
Task driven schedule management (managing interdependencies, critical path)
Multiple resource views(time, cost, baseline, budget)
Collaborative team planner (access management, portfolio view)
Simulation and scenario analysis
Project information collaboration and reporting
Issue tracking
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Site Operations Management Software
Real-time helps to plan, operate, control and analyse construction site operation . It will be a great help if the software is integrated with scheduling and back-office finance system Ex. BuildToolsConstruction , SAP
Key Features Of Scheduling System:
Work flow management (order approvals, issue escalations)
Supplier relationship (bids, contracts, purchase orders)
Work orders, stock and inventory control
Roster management (shifts, time & attendance, job costing)
Document management (store, view, version control , approve)
Integration with financial planning, PM and other systems
Real Estate Construction Related Laws & Regulations In IndiaIt is a complex combination of central, state and local laws and regulation. It is advisable to consult internal or external legal expert if project team need to decide any legal issue. CREDAI (Confederation of Real Estate Developer's Associations of India) is the apex body of the organized real estate developers/builders across India. Following is a list of few important laws which influence to real estate construction projects: Indian Contract Act, 1872
Transfer of Property Act, 1882
Registration Act, 1908
Special Relief Act, 1963
Urban Land (Ceiling And Regulation) Act (ULCRA), 1976
Land Acquisition Act, 1894
The Indian Evidence Act, 1872
Foreign Direct Investment (FDI) law
Each State has its own set of laws, which govern planned development, the two laws that exist in every State are the stamp duty and rent laws
List Of Labour Laws For Building & Construction Industry In India (check amendments also) Trade Union Act, 1926 Children Pledging of Labour Act,1933 Payment of Wages Act, 1936 Employers Liability Act,1938 Industrial Disputes Act, 1947 Employees State Insurance Act,1948 Minimum Wages Act,1948 Factories Act ,1948 Mines Act, 1952 Employee’s Provident Fund and Miscellaneous Provisions Act, 1952 Collection of Statistics Act, 1953 Apprentices Act ,1961 Employment Exchanges( Compulsory Notification of Vacancies) Act,1959 Motor Transport Worker’s Act,1961 Personal Injuries (Compensation Insurance ) Act ,1970 Payment of Bonus Act,1965 Contract Labour(Regulation and Abolition) Act, 1970 Payment of Gratuity Act,1972 Bonded Labour System (abolition) Act,1976 Equal Renumeration Act, 1976 Interstate Migrant Workmen (Regulation of employment and conditions of Service) Act,
1979
Project Life Cycle &
Project Phases In Real Estate Project
Project life cycle is the series of phases that the project passes through from its initiation to its closure.
Each project may be divided into many phases to improve management control.
Collectively, the project phases are known as the project life cycle.
These are unique to the industries
Each phase is marked by completion of one or more deliverables. Phase-end reviews are called phase exits, stage gates, or kill points.
Always Manage Project From Life Cycle Perspective And Not For Individual Phase
Project Life Cycle And Project Phases
Over View : Real Estate Project Life Cycle
The ability to influence the final characteristics of the project’s product without significantly impacting cost is highest at the start and decreases as the project progresses
Phase To Phase Relationships : Sequential
Phase To Phase Relationships : Overlapping
Predictive Life Cycle (Fully Plan Driven) : In this case project scope, time and cost required to deliver the scope are determined as early in the project life cycle as practically possible.
Ex. Single Phase Building Construction
Project Life Cycle And Types Of Project Life Cycle
Iterative And Incremental Life Cycle : Iterative life cycles are one in which project phases (also called iterations) intentionally repeat one or more project activities as the project team’s understanding of the product increases.
Ex. Multiphase building construction
Project Life Cycle And Project PhasesTypes Of Project Life Cycle
• Adaptive Life Cycle ( Change Driven Or Agile Methods) : Intended to respond to high level of change and ongoing stakeholder involvement. Adaptive method is also iterative an incremental but differs in that the iterations are vary rapid (usually within duration of 2 to 4 weeks) and are fixed in time and cost. Adaptive projects generally perform small incremental improvements that will deliver value to stakeholders
Project Life Cycle And Project PhasesTypes Of Project Life Cycle
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03 Project Management Process Groups & Knowledge Areas
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