Architecture > Study Notes > Course: Development Feasibility and Modelling - Hypothetical Development Analysis Notes (All)
Course: Development Feasibility and Modelling - Hypothetical Development Analysis Notes
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Hypothetical Development Analysis Gross Realisation = Land Value + Development Costs + Profit + Disposal Costs Therefore, if we wish to determine the land value, the calculation would be as follow... s: Land Value = Gross Realisation – Disposal Costs – Profit – Development Costs The hypothetical development method involves the following steps: Disposal value of completed development Expected Gross Sales Gross Realisation Less Costs of Disposal Selling fees such as commission and legal fees on sales Net Realisation Less allowance for Profit and Risk on the development Profit Less Costs of Development development costs, rates and taxes and interest on development Total Development Costs Less Interest on Land & Acquisition Costs interest on land, stamp duty and legal fees on purchase Acquisition and Interest Costs Residual Value Land ValueGross Realisation Profit and Risk Allowance Profit & Risk Allowance = Profit / Total Development Costs Treatment of Interest in Hypothetical Development Analysis [Show More]
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