A feasibility study is a process of analyzing the value of a real estate investment. Since every aspect of the property and project is being examined with this study, it is a necessity for every investment. In this way, it is possible to understand what and how much can be built on a specific piece of land.
A feasibility study is an examination that helps the property owners and developers to recognize the value of a potential real estate investment. Thanks to this assessment, it is possible to understand whether this real estate investment idea makes sense or not. Since every aspect of an investment is being questioned during the feasibility study, making this examination is a must for every investor before he or she puts energy, time, and money into real estate.
Before buying real estate as an investment, a preliminary feasibility study needs to be performed. During this examination, some necessary steps need to be taken. However, the preliminary study is less comprehensive than the actual feasibility study. The main difference between a preliminary feasibility study and a feasibility study is the number of options - schemes in mind.
During the preliminary examination, an investor has more than one scenario and tries to understand the best investment option among them. If the real estate seems profitable after this examination, the actual feasibility study is performed.
To perform a feasibility study, first, you need to think about the location of real estate. During that step, you should also analyze other properties and buildings around that location. A professional architect prepares an analysis of the local zoning ordinance for the owner or developer to have a clear idea of the floor area you are going to have.
The next step is to decide on the massing. Before this decision, you need to determine parameters, such as setbacks, open-air, and so on, based on the local zoning codes. Afterward, a site plan is being made to determine the building massing. The massing plan represents many features, such as maximum buildable height, and buildable open area. With this step, the qualities of the building become more apparent.
The third and final step is to draw the overall plan by units, floors, and elevations. Thanks to this step, the scope of the project can be recognized clearly. During this step, the building massing includes more details. However, it is still a rough project.
For the feasibility study to be performed successfully, you need to hire an architecture firm that will analyze the local zoning ordinances and codes.
As you´ve seen throughout the article, a feasibility study is essential for investors to determine the possible value and the features of the project. Therefore, before investment, you should learn more about the feasibility study and consult with a reliable architectural firm.