How do developers run a quick feasibility check before buying land?
A quick land feasibility check answers four questions before you spend on studies: what zoning lets you build, how many units or square feet that is, what the finished project would be worth, and what you can afford to pay for the land once costs and profit are covered. That last number, the residual land value, decides whether the asking price works.
Answered
A quick land feasibility check answers four questions before you spend on studies: what zoning lets you build, how many units or square feet that is, what the finished project would be worth, and what you can afford to pay for the land once costs and profit are covered. That last number, the residual land value, decides whether the asking price works.
The four steps
1. Zoning: permitted uses, height, FAR or density, setbacks, parking requirements and any overlays.
2. Yield: the buildable envelope turned into units or square feet, after parking and efficiency losses.
3. Value: what the finished project would sell or rent for, from recent comps for new product nearby.
4. Residual land value: finished value minus hard costs, soft costs, financing, and developer profit. Compare it with the asking price.
Quick rules of thumb to check
- If the residual land value is well below the asking price, the deal needs a zoning change, a higher-value product or a lower price.
- Parking often limits yield more than height or FAR.
- Soft costs and financing are frequently underestimated in early checks.
What can sink a site later
- Environmental conditions, flood zones, easements and utility capacity.
- Entitlement risk: a use or density that needs discretionary approval.
- Title issues and liens on record.
How Titleman helps
Titleman reads zoning and parcel facts, estimates the buildable yield, pulls comps for the finished product and computes residual land value in a feasibility model you can edit. Deal Review can also check a feasibility model you already have, cell by cell: https://titleman.ai/products/deal-review