Development

Development Appraisal

Full development appraisal from GDV through to profit, with sensitivity headroom.

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Introduction

Who this is for: Developers and lenders appraising a scheme where the land price is already known.

Why it matters: Where Residual Land Value solves for what you can pay, this solves for what you make at a price already agreed. It is the appraisal a lender will run against your figures.

Typical scenario: A developer has agreed £850,000 for a site and needs to prove 20% profit on cost to a lender.

Common mistakes:
  • Omitting the sales period, during which finance continues to accrue.
  • Understating contingency on refurbishment or listed buildings.
  • Assuming all units sell at once rather than over a sales programme.

Inputs

Value

units

£

Land & Build

£
£
£
%
%

Other Costs

£
£
%
%

months

months

Analysis

A 14-unit scheme with GDV of £4,130,000 against total costs of £3,964,831 produces £165,169 profit — 4.2% on cost, 4.0% on GDV. Units would need to average £283,202 to break even.

This analysis provides context, not financial advice. Consult a qualified adviser before making investment decisions.

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Sensitivity Analysis

Sensitivity

Adjust the variables below to stress-test this scenario. Results update instantly.

14
128
£295,000
£0£590,000
£850,000
£0£1,700,000
£145,000
£0£290,000
8.5%
025

Export

Live Results

Profit

£165,169

Profit on Cost

4.17%

Profit on GDV

4.00%

GDV

£4,130,000

Profit on cost is 4.2% — below the 20% most development lenders require.
Only a 4.0% fall in values wipes out profit. Lenders stress-test at least 10-15%.
No allowance for abnormals. Contaminated ground, demolition, asbestos, piling or archaeology are the usual reason a scheme that appraised well loses money — worth a figure here unless a site investigation has ruled them out.
Total Costs£3,964,831
Build Cost (all-in)£2,354,800
Finance Cost£378,131
Break-Even Unit Value£283,202
GDV Fall to Break-Even4.00%