Savvy investors and developers know that having an expert appraisal firm in their back pocket can be the difference between a very successful career and bankruptcy. When tackling large-scale investments and development projects it is paramount to make data-driven decisions that will translate to dollars on the back end.
Feasibility Studies and Analyses
Financial feasibility studies are used to determine if it is financially feasible to develop a proposed property. Due to the high risk of developing real estate, a feasibility study is a necessary planning tool and any developer would be remiss to not consider obtaining one. Financial feasibility studies are performed once preliminary drawings and construction cost estimates have been developed. They are best suited for a specific property with a well-defined highest and best use. Although feasibility studies are similar to highest and best-use studies, (see below) they generally have greater detail. If you have already done preliminary research into one or two property types that you believe would be well suited for development or redevelopment, a feasibility study may be a great fit for you. However, if you are still uncertain as to what property type would bring maximum value to your property, consider getting a study of highest and best use.
Market Studies and Analyses
Market study vs feasibility study:
A lot of people would lump market studies and feasibility studies together but they are markedly different and occur at different times during the development process. Generally speaking, a market analysis seeks the intersection of supply and demand that will create a market for a given property type at a given price. Additionally, a market analysis is performed early in the process, while a feasibility analysis is performed after there are preliminary drawings and construction cost estimates.
Since there are nuances of supply and demand factors for any given property type, there are different depths of research and slightly different forms that market analyses might take. Not all are created equal.
Market and Feasibility Studies
When tackling large-scale investments and development projects it is paramount to make data-driven decisions that will translate to dollars on the back end. Our experts at Lake State Realty can help.