Description
You are a development surveyor working for Fortitude Real Estate, a major UK real estate consultancy. Fortitude Real Estate specialises in advising Clients on urban redevelopment projects throughout the UK. These are often mixed-use schemes. Fortitude Real Estate’s Clients include property companies, housebuilders, commercial developers, landowners and national and local governments.
Your day to day job as a development surveyor involves researching a range of factors in order to help your Clients make informed choices about development and investment opportunities (often known as ‘projects’). You consider a range of complex factors when providing Clients with information and your financial considerations are always evidenced.
For this assessment project, you will be advising your Client, Anderssen Developments. They are considering whether to pursue the acquisition and development of land at Arundel Street and Sidney Street in Sheffield and have commissioned you to undertake a development appraisal. You’ve worked with Anderssen Developments before. They usually develop mixed use schemes, selling the fully let commercial element to an investor and disposing of the residential element themselves via an estate agent. They have confirmed the same strategy for this project.
Your task therefore is to prepare a development appraisal report for Anderssen Developments that fully examines the development feasibility of the site and recommends a course of action that offers them the greatest likelihood of a successful outcome. Please note, this may include advising against the acquisition of the site or deferring an acquisition decision to a later time.
You have done some preliminary scoping work already – you have prepared a development proposal for the site (see below) and the design you have initially chosen is compliant with local planning policies.
Your remaining tasks are:
to examine the property market and planning context of the site; value the development proposal and consider any adjustments to the design; identify project risk and discount the valuation accordingly; and, value the project’s investment performance.
You should conclude with a recommended course of action for your Client i.e. should Anderssen Developments proceed with the acquisition and development of the site?
Your recommendation should be fully justified and based on the preceding information and analyses contained within your report.
Your Client report will need to cover the following aspects of your recommended course of action:
A basic description of the site and the development proposal
The market and planning context for the development proposal
A residual valuation of the development proposal
The potential for enhancing the viability of the development proposal through design changes within relevant planning and market constraints
The identification and analysis of project-specific risk
An estimation of the discount rate
The performance of the project as an investment
The course of action to be recommended to Anderssen Developments
Your Client report should be a professional, focused, accessible and clearly structured document so to reflect the nature of reporting in surveying practice. It should present a series of evidence that culminates in a recommended course of action to Anderssen Developments that is logical and based on the information presented in the report.
