FEASIBILITY & HIGHEST AND BEST USE

What Can Be Developed — and What Makes the Most Sense?

A property may support several possible development strategies. The largest project or highest density is not necessarily the best business decision.

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EPA evaluates development alternatives by considering:

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• Physical site capacity

• Development program

• Product type and product mix

• Density

• Market positioning

• Zoning and entitlement considerations

• Infrastructure requirements

• Preliminary development cost

• Revenue potential

• Development timeline

• Phasing opportunities

• Alternative development scenarios

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Where appropriate, we compare multiple strategies based on marketability, capital requirements, execution complexity, risk and financial performance.

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The goal is to identify the development approach with the strongest overall business case — not simply the maximum buildable area.

FINANCIAL MODELING & INVESTMENT ANALYSIS

FINANCIAL MODELING & INVESTMENT ANALYSIS

EPA translates development assumptions into a financial model that can be evaluated under different capital, cost, timing and market scenarios.

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Analysis may include:

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• Development pro forma

• Sources and uses

• Project cash flow

• Development cost assumptions

• Debt and equity structure

• Construction financing

• Financing cost and interest

• Sales or rental assumptions

• IRR

• Equity multiple

• Return on cost

• Break-even analysis

• Sensitivity analysis

• Scenario modeling

• Phased development analysis

• Hold versus sell

• Rent versus sell

• Exit analysis

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Our focus is not only on the calculated return, but on whether the assumptions producing that return are reasonable.

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Construction cost, development schedule, contingency, pricing, absorption and exit assumptions can materially change the result. Those assumptions should be tested, not simply accepted.

DEVELOPMENT STRATEGY & RISK

Identify Execution Risk Before It Becomes an Expensive Problem.

A project may be financially attractive on paper while still carrying significant execution risk.

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EPA reviews the development plan from a practical implementation perspective, including:

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• Entitlement and approval risk

• Site and infrastructure dependencies

• Design and program assumptions

• Construction budget completeness

• Contingency and cost exposure

• Schedule assumptions

• Procurement and contractor risk

• Financing and capital timing

• Market absorption

• Exit strategy

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The purpose is to identify where risk is concentrated and determine whether the development plan should be adjusted before major commitments are made.

REAL ESTATE BUSINESS & INVESTMENT STRATEGY

A Real Estate Project Must Work as a Business — Not Just as a Building.

For more complex opportunities, EPA evaluates how the development plan, capital structure and operating strategy work together.

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Advisory may include:

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• Overall development strategy

• Project phasing

• Capital planning

• Revenue model

• Operating strategy

• Product and market positioning

• Development sequencing

• Capital deployment

• Hold strategy

• Disposition strategy

• Exit planning

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This work is particularly relevant when a project involves multiple phases, different product types, changing capital requirements or a business model that must evolve over time.