what is a capital project 
a capital project is a long term capital intensive investment to build upon add to or improve a capital asset capital projects are defined by their large scale and large cost relative to other investments that involve less planning and resources understanding capital projectsa capital project is a large scale project with a high cost that is capitalized or depreciated regular capital investments such as new facilities structures or systems may be necessary to accelerate growth within a company or government for example if a company wants to build a new warehouse or purchase new manufacturing equipment to increase efficiency on the factory line capital projects typically consist of the public sector building or maintaining infrastructure such as roads railways and dams and companies upgrading expanding or replacing their facilities and equipment capital projects must be managed appropriately for they require a significant commitment of company resources and time the project assumes a calculated risk with the expectation that the capital asset pays off management of risk is a key driver of successful project development and delivery of a capital project examples of capital projectsthe most common examples of capital projects are infrastructure projects such as railways roads and dams in addition these projects include assets such as subways pipelines refineries power plants land and buildings capital projects are also common in corporations corporations allocate large amounts of resources financial and human capital to build or maintain capital assets such as equipment or a new manufacturing project in both cases capital projects are typically planned and discussed at length to decide the most efficient and resourceful plan of execution capital projects are big investments and therefore face a lot of scrutiny especially when paid for with public funds or the money of a publicly traded company the goal is for these investments to pay off but sometimes they are poorly planned and executed and end up losing significant capital capital project fundingthese projects are big take time to complete and can cost a lot of money meaning it is often necessary to obtain equity or debt financing to make them happen to receive funding capital projects are obligated to prove how the investment provides an improvement additional capacity new useful feature or benefit reduced costs analysts might use the return on new invested capital ronic calculation to evaluate if the return on a project is worthy of the capital investment additional funding sources for these projects include bonds grants bank loans existing cash reserves company operation budgets and private funding these projects may require debt financing to secure funding debt financing may also be required for infrastructure such as bridges however the bridge cannot be seized if the builder defaults on the loan debt financing ensures that the financier can recover funds if the builder defaults on the loan economic conditions and regulatory changes can affect the start or completion of capital projects as in the case of brexit which caused the cancellation or delays of some projects in britain 123in the united states congress is responsible for funding public capital projects such as roads power lines bridges and dams 4