Property Development Feasibility Analysis â€Myassignmenthelp.Com

Question: Discuss About The Property Development Feasibility Analysis? Answer: Introducation This particular section involves supply variables concerning office and retail sector on property market analysis for significant development of property. The total lettable area will be incorporated. To begin with, supply variables have a great impact on office and retail section of any property under development. For the purpose of this report, supply variables have a perfect positive correlation to the supply function. Mathematically, supply financial refers to an expression that shows correlation between supplies and the aspects or factors affecting the ability and will of supplier to provide commodities for sale (Bragg 2015). Thus, graphically, variables tend to remain constant when supplied quantity is plotted against the underlying prices. Total lettable areas. This indicates the net lettable areas of the property. It is important to note that every building has unique definition things to be included in the building area. According to the Property Council of Australia, there is industrial standard used for measuring areas for building different properties. The total lettable or the net lettable area is applied in computation of tenancy area in office and business parks, office buildings as well as retail outlets. For this case the net lettable area for office and retail sector refers to the sum of the total floor lettable areas (Daft 2015). Therefore, the total lettable areas for office and retail sector would also include the gross lettable area applied in computation of tenancy areas. These areas include warehouses, showrooms, industrial buildings as well as freestanding supermarkets for retail sector (Chopra 2012). However, there are some areas that are excluded in total lettable areas. They include the stairs, toilets, cupboards, escalators as well as tea rooms and other service areas. Number and total value of approved DA. Development Application (DA) reflects request for consent that assist individuals in carrying out development which should be approved by local council. The local council needs to ensure that this development does not interfere with residential amenities (Hughes 2008). The total value of approved DA is set on sliding scale which is fully anticipated by cost of work. A DA can cost from $ 220 for estimated job up to $5400. This could move to $ 15786 for the office and retail sectors. Supply variables for office and retail sector There are several typical supply variables that affect the office market and are economic-based in nature. Employment rate in the office sector If the employment rate is high, then the supply of office increases according. The reverse is also true. Office floor space. There has been omission of supply variable due data non-availability in the previous case studies. However, it is important to note that the more the office space, the more supply. There are other supply variables that greatly affect the retail sector. The cost of retail. If the cost of retail increases, the supply increases proportionally so as to generate the anticipated value. The reverse is also true. Government policies. There are some policies that a government can formulate regarding the retail sector that can adversely affect the supply (Fletcher 2012). Favorable policies will increase the supply while unfavorable policies will reduce the supply. This section deals with market performance indicators, demand variables and supply variables. Graphs indicate a clear picture of both supply and demand variables. Market performance indicators. There are several market performance indicators that show the progress of the business and the entire market. There are four key indicators. They include employment, inflation, consumer activity and investor activity. This is the key market performance indicator. This factor asserts that, during the high rate of employment, people gain a lot of wealth. This increases the purchasing power in the market. During high rates of unemployment, money inflow reduces thus lowering the purchasing power in the market. Typically, inflation refers to too much money chasing few goods in the market. When the inflation rate is stable, the performance of the market is in good condition (Christopher 2011). However, both inflationary and deflationary gaps indicate low market performance. Consumer activity. The high consumer activity indicates good market performance and the reverse is also true. A perfect market has huge number of buyers and sellers (Prasch 2008). Although, goods are homogeneous in nature, there is high consumer activity which critically indicates a better market performance. Investor activity. Investors tend to venture in areas having promising market performance (Bolstorff 2011). Therefore, a market with high investor activities indicates a good market performance indicator and vice versa. This bar chart indicate relationship between data on employment occupation against time in years from 2008 to 2013 for Australia labor market statistics. Figure 1.1. This line curve indicate relationship between data on employment occupation against time from 2008 to 2013 for Australia labor market statistics. Figure 1.2. Both figure 1.1 and 1.2 indicate a bar chart and line chart respectively. They indicate the relationnship distribution of data in employment occupation against time in year. The time period ranges from 2008 to 2013. The data indicate how data in differeent occupations changes from 2008 to 2013. From the charts above, the data in each occupation keep on changing each year. None of the data in the occupation is consistent. There is either increase or decrase in data distribution. Therefore, to relate to variable in office place, this data may be affected by damand variables and supply variables in office place renatal markets. These variables would include; Anticipation of future changes in price. If the price for office space rental market is expected to increase in the future, the demand lowers and vice versa. More supply will take place at higher prices (Cachon 2012). The graph below indicates increase in price results to increase in supply and vice versa. Government policies. If the government offers incentives to office space rental market, then the supply will increase. If unfavorable tariffs are subjected, then the supply lowers. Increase in price decrease the demand and vice versa. From the graph below, increase in price results to decrease in output demanded. Real gross domestic product. This variable affect the supply of office sector by indicating the general economic conditions which have a perfect positive correlation with the level of employment (Awuor 2016). The higher the real gross domestic product, the higher the supply of office and vice versa. References. Awuor, P 2016, Theory of Change for Supply Chain Capacity Development: A Framework for Strengthening National Supply Chains: Volume 1 (PSA Supply Chain Capacity Development), CreateSpace Independent Publishing Platform. Bragg, SM 2015, Accounting for Inventory, Accounting Tools. Bolstorff, P 2011, Supply Chain Excellence: A Handbook for Dramatic Improvement Using the SCOR Model, AMACOM. Cachon, G 2012, Matching Supply with Demand: An Introduction to Operation Management, McGraw-Hill Education. Chopra, S 2012, Supply Chain Management, Pearson Education. Christopher, M 2011, Logistics and Supply Chain Management, FT Press. Daft, RL 2015, Management, South Western College Pub. Fletcher, F 2012, Business Problem Solving, Routledge. Hughes, D 2008, The Ultimate Supply Teachers Handbook, Continuum International Publishing Group Ltd. Prasch, RE 2008, How Markets Work: Supply, Demand and the Real World, Edward Elgar Pu