Feasibility Analysis, Studies & Services
Colorado Appraisal Consultants offers feasibility services for commercial and multi-unit residential (subdivisions/apartments) properties throughout Colorado.
A Feasibility Study seeks to identify if the market value or gross sellout of a project upon achievement of a stabilized condition equals or exceeds all costs of production, including profit. Market value applies to rental or leased properties, wherein gross sellout applies to a project that will be developed into multiple units to be sold to multiple users.
A feasibility analysis can either use a defined rate of return to determine economic feasibility, or, the appraiser can utilize a market-derived rate of return. When ordering a feasibility study, it is important to disclose your hurdle rate or minimum required return if you have considered this factor.
Feasibility Study Services
Feasibility studies are best suited for a defined property with a loosely defined or well-known highest and best use. One of the reasons for this is that feasibility studies, though very similar to highest and best use analyses, have much greater detail. Generally speaking, the feasibility portion of a highest and best use analysis is an A or B level, inferred market analysis. This is because a highest and best use analysis compares multiple property types to determine the highest return and in most cases, it would be impractical to perform a fundamental market analysis for every single potential property type considered within the feasibility portion of a highest and best use analysis.
In contrast, most feasibility studies include a C or D level fundamental market analysis. Focusing on one property or property type allows for a report that is easier to read and within the budget. Performing a feasibility study with fundamental market analyses for five or more property types would not be within most budgets, nor would it be pertinent to the user of the report.
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.
If you are still uncertain as to which use would bring maximum value to your property, you may be better suited with a highest and best use study.
Feasibility Study Pricing
Feasibility studies are highly detailed and require significant time to develop by a qualified individual. They are priced accordingly. Please use this online pricing form to get pricing on your feasibility study.