development valuation - questions

1 Determine the market value of the following development site for a new industrial warehouse:

2 Prove your answer in 1.

3 Determine the value of industrial in globo land from the following information:

4 Prove your answer in 3.

5 Analyze the profit and risk factor for a residential subdivision from the following information:

6 Prove your answer in 5.

7 What are the relevant factors that make up the profit and risk of a proposed development?

How do these vary with size and complexity of development?

8 Analyze the courts' assessment of risk of realization in hypothetical developments. What factors do they consider make up the risk?

Is this the same as the Profit and Risk Factor?

9 Discuss the courts' approach to Hypothetical Development. Why have the courts been reluctant to accept Discounted Cash Flow and statistical methods (such as Multiple Regression Analysis) as valid methods of valuation?

10 When determining the net realization after profit and risk, the net realization is multiplied by the factor; 100/(100+PR), where PR = the profit and risk as a percentage.

What is the logic behind such a calculation?

11 Analyze the arguments used in the Albany case against the use of Discounted Cash Flow. How important are such arguments to the valuation profession?

Does the logic apply to all methods of valuation that include large amounts of speculation?

12 There is a trend towards more denser residential development (density development).

How does this affect the variables used in the hypothetical development method?

How does it affect the profit and risk factor compared with a conventional development?