Project valuation tool Market valuations for development sites and projects using the residual-value method.
As the foundation for investment decisions in land and properties, among other things, potential assessments and valuations are required. In order to improve the efficiency and quality of the valuation, the project valuation tool was created, which can be used specifically for development properties. The project valuation tool is used to determine the market value of properties and real estate projects using the residual-value method. The value determination takes place in a few steps, whereby the level of detail and the manual override of the model specifications are determined by the users themselves.
All valuation parameters are based on current, market-oriented information such as local asking prices, location- and use-specific yields as well as numerous cost benchmarks. The base data is constantly updated and indexed, thus allowing for market-consistent valuations that are always up to date.
- Property: Entry of the location, address and plot area; several valuations can be performed per property.
- Base data: Specification of the standard, state, topography, subsoil and risk rating
- Revenues: Entry of achievable floor space per usage type (utilization and degree of building density must be known); manual income estimation, or based on model assumptions, derivation of the capitalized earnings value upon completion by means of gross capitalisation
- Costs: Determination of approximate development costs using benchmarks for Swiss Building Cost Classification (BCC) main groups 1–5
- Risk/profit: Valuation of the development risks by means of our risk-rating model
Valuation of development risks
The risk and profit of a development project are to be differentiated by type of usage, form of ownership and project status. During a project development – with the assistance of a differentiated risk-rating system that takes planning/design, realisation and marketing status into account – the respective risk and profit can be estimated at any time. The estimation of development risks occurs on the basis of our risk-rating model.