1 / 16

Development Appraisal Day 2 Exercises

Development Appraisal Day 2 Exercises. Objectives. Identify sources of information for assumptions Build more detailed appraisals Understand about viability of different uses Understand complexity of real life development appraisals. Real life appraisals………… ……….they can get complicated!.

burdettet
Download Presentation

Development Appraisal Day 2 Exercises

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Development Appraisal Day 2 Exercises

  2. Objectives Identify sources of information for assumptions Build more detailed appraisals Understand about viability of different uses Understand complexity of real life development appraisals

  3. Real life appraisals………… ……….they can get complicated!

  4. Appraisal Inputs Sources of information Employing the professionals Phoning the professionals Buy access to a database Published research Other sources

  5. Appraisal Inputs Gross floorspace (GIA) • Gross site area • Net/gross site ratio • Site coverage • Density

  6. Appraisal Inputs Net floorspace (NIA) • Typical values: • Houses: 100% • Flats: 85% • Offices : 85% • Retail: 95% • Industrial: 95%

  7. Appraisal Inputs Value of floorspace

  8. Appraisal Inputs Build costs • Depends on design & procurement • High = Grade A offices & high density flats say, £1,500psm • Low = Retail warehousing & industrial say, £500psm

  9. Appraisal Inputs Site preparation & infrastructure • Earth moving/removal • Utilities • Highways • Demolition • Remediation • Flood protection etc

  10. Appraisal Inputs Fees & marketing/sales Core development team & additional consultants: 10 – 20% of build costs Marketing: 2-3% of value Letting agent & legals: 10% & 5% of rent Sales agent & legals: 1% & 0.5% of value Other professionals

  11. Appraisal Inputs Finance Costs • Proportion of development costs borrowed varies • Interest rate reflects: • Developer strength • Risk of development • Proportion of costs borrowed • Finance drawn down

  12. Appraisal Inputs Other Costs • External works • Car Parking • Developer’s contingency • Code for Sustainable Homes • Developer Contribution

  13. Appraisal Inputs Timing • Some receipts received before completion • Void on commercial space unless pre-let • Some costs are “upfront” • Build costs often assumed as “S Curve”

  14. Development Appraisal Exercise Notional 1 hectare site in “typical” town

  15. Development Appraisal Exercise Key questions: What is the net/gross site ratio & coverage? What is the development mix? What are the values/costs of the uses? How many storeys are the buildings? What are the site acquisition costs? What other development issues are there?

  16. Development Appraisal Exercise Scenario 1: Office development Scenario 2: Residential & office development Scenario 3: Residential & retail development Scenario 4: Retail & leisure development

More Related