Real Estate Development Projects Research Articles

استراتيجيات إدارة الأعمال الفعالة وتطبيقها في التخفيف من مخاطر مشاريع التطوير العقاري في المملكة العربية السعودية

The research intends to investigate efficient business management methods and their application in minimizing risks associated to real estate development projects in the Kingdom of Saudi Arabia. The questionnaires were delivered to a sample of 163 participants working in sectors connected to the study topic, and the data was examined using statistical analysis, which confirmed the reliability of the responses and the correctness of the findings. The findings highlight the essential significance that competent management methods play in decreasing the financial risks connected with real estate development projects. By implementing effective management practices, financial risks coming from market volatility, project delays, or cost overruns may be mitigated. The findings also revealed the need of good management methods in activating sustainable practices within these projects, since this contributes to the viability of projects in the long run by caring for the environment and resources. In addition, good management methods play a vital role in promoting transparency within real estate development projects, as they assist explain financial and administrative procedures, which adds to developing confidence among all parties engaged in the project. In conclusion, the research indicated that competent management is not only a tool for lowering risks, but also a vital aspect in assuring the sustainability and transparency of real estate developments in the Kingdom.

Crucial factors for decision-making in international real estate development projects: Evidence from Chinese developers

This study aims to investigate the crucial factors influencing decision-making in international real estate development projects. The identification of these factors was initially derived from a comprehensive literature review and further refined through expert input from Chinese real estate developers. Subsequently, questionnaires were administered to these experts in three focus groups. The key determinants for decision-making in international real estate development projects were identified as follows: political stability condition of the host country, international diplomatic relations between the host and home country, macro-economic situation of the host country, maturity of real estate market in the host country, project financing, and international experience of the enterprise. The most significant categories encompassed political, economic, and project factors. This study addresses the scarcity of literature on international real estate development, with a specific focus on developers originating from developing nations. It has the potential to enrich the discourse surrounding international real estate practices and contribute valuable insights for future academic investigations.

A Study of Administrative Regulations on Real Estate Project Finance and Recent PF Market Issues

Real estate project financing is the process by which real estate developers secure funding. This study categorizes the types of real estate finance and analyzes investment types based on the degree of financial companies’ participation. Financial companies invest in real estate development projects either through direct financing, using PF loans, or through indirect financing via mechanisms such as collective investment schemes. However, if a financial company is not merely a financial investor but also acts directly as a developing entity, appropriate regulation is required. From an investor protection perspective, the Financial Act aims to alleviate information asymmetry and enhance the financial soundness of financial companies. An important issue is the regulation of financial companies directly implementing real estate development projects. In particular, if a real estate development project fails, the implementer bears primary responsibility. Therefore, granting enforcement authority to a financial company that controls the funding mechanism may pose a risk to financial companies. Real estate financing suggests that administrative regulations should be organized in a way that facilitates collaboration among multiple administrative agencies. The regulatory frameworks of both the Construction Act and the Financial Act should govern financial companies’ participation in real estate development projects, necessitating close cooperation among different administrative agencies. In the complex and specialized administrative legislative process, overlapping responsibilities among multiple administrative agencies, such as those under the Real Estate Investment Company Act, may occur; conversely, gaps in responsibilities may also arise. With this in mind, it is necessary to acknowledge the role of financial companies beyond their fundraising function in real estate finance and to investigate the complex and diverse legal relationships that may arise as a result. In particular, given the current situation—marked by the downturn in the real estate PF market that began last year, the subsequent workout of Taeyoung Construction, and concerns about the deterioration of savings banks’ soundness—, it is crucial to explore an effective regulatory system for real estate development finance by integrating the Construction Act and the Financial Act.

Price disparities in the housing market vs. transportation costs for households. A case study of real estate development projects in Szczecin

Motives: Land situated on the outskirts of cities and even outside their borders is being seized for urban development, as well as for housing purposes. Properties in such locations are usually significantly cheaper than those located in the city centers. However, living in a suburban location often entails higher commuting, education, and entertainment costs. Therefore, the following question arises from a property buyer’s point of view: is it more economically advantageous to purchase more expensive property in a downtown district or a cheaper one located peripherally and incur higher transportation costs? Aim: The purpose of the study was to compare the transportation costs incurred by households in peripheral locations with the property price differentials between suburban and central city districts. Results: The study covered the city of Szczecin. Data for the study were obtained from public sources and analyzed with tools such as the payback period, simple rate of return, net present value (NPV) for 10 and 20 years, and internal rate of return (IRR) for 10 and 20 years. The results indicate that in certain cases, very high commuting costs might encourage potential buyers to consider the purchase of more expensive property in a central city location where these costs are significantly lower or not necessary.

Multi-objective early-stage design optimization of multifamily residential projects

The aim of this study is to find a building form and plan layout that can be used in the early stages of architectural design, where criteria such as daylight, view, sun-hour, sales area, and cost are optimized according to the different expectations of different housing type users. This study proposes a multi-objective early-stage design optimization for a real estate development project based on the NSGA2 genetic algorithm, considering weighted user preferences for different housing types. The framework is implemented using the platforms Rhino and Grasshopper; Wallacei is used for NSGA2, and Viktor.ai is used to deploy the app. Tested on six sample plots, the model was able to find architecturally optimized results that respond to different user expectations. While the model successfully demonstrated responsiveness to parameters, its focus on Pareto-optimal solutions limited the diversity of unit mixes generated. The model has been tested by professionals on a sample plot and is found to be important for architects and investors to generate ideas at an early stage of architectural design.

Analysis on Lean Management of Real Estate Projects Oriented by Target Cost Management

At present, the state has more and more regulatory policies for the real estate industry, and the regulatory intensity is also greater. With the introduction of national policies and the impact of the downturn in the real estate market, industry competition has become increasingly fierce. Under this situation, if real estate companies want to avoid being eliminated by the market, they must rely on their own efficiency levels and management capabilities. Therefore, strengthening cost control on projects is an inevitable choice and important means for real estate companies. In recent years, with the slowdown of economic growth and the state's regulation of the real estate industry, the sustainable development of the real estate industry has faced increasing challenges. This article is oriented by target cost management and focuses on the lean process of real estate development projects. The key points of management and its management strategies are discussed to provide industry reference.

개발사업에 있어서 단계별 리스크 요인분석

The purpose of this study is to investigate the importance of each apartment development project to examine the risk factors, and to find ways to minimize risk for each part and to develop the apartment development project. This study classified all stages of the development process into five stages by referring to previous research papers and literature surveys published on risk factors and management plans for apartment and integrated housing development projects. The cause of the risk is analyzed through research, experiences, and cases that occurred in the process of selecting and securing the initial development site, and the implications through solutions are examined by organizing the problem-solving process for each case. AHP analysis and fuzzy analysis were applied to calculate each core and fundamental risk. The purpose of this study is to recognize the risk factors included in the apartment real estate development project and to derive management measures to minimize the risk.

Application of a Hot Melt Recoverable Anchor Cable in Foundation Pit Support

With the continuous development of the social economy, the depth of foundation pit excavation of proposed construction projects in various places gradually increases, which is closer to the building red line, and the surrounding environment is relatively complex; therefore, there are few supporting schemes for foundation pit selection. Based on the Vanke B-6 plot of a real estate development project, the project has close neighboring buildings. If we use a normal anchor cable, underground cut line problems are possible, and so we choose the hot melt-type recoverable anchor; with three element dispersion pressure, the anchor cable can minimize broken sections of brush slope excavation and has advantages of a simplified construction process and good seismic performance. Except for the cable barrel, the other parts and all steel strands can be recycled, and recycled parts can be reused. The recyclable bolt (cable) overcomes the disadvantages of the conventional bolt (cable) as a temporary support, such as pollution of the underground environment, encroachment on the underground space of adjacent buildings, and becoming an underground obstacle in follow-up projects. It accords with the characteristics of the times of environmental protection and sustainable development, and has achieved good economic and social benefits.

Phasing real estate projects considering profitability and customer satisfaction

PurposeThe aggressive competition in the real estate market forces real estate developers to tackle the challenge of selecting the best project construction phasing alternative. The real estate industry is characterized by high costs, high profit and high risks. The schedules of real estate projects are also characterized by having large number of repetitive activities that are executed over a long duration. The repetitiveness, long duration of execution, the high amounts of money involved and the high risk made it desirable to leverage the impact of changes in phasing plans on net present value of amounts incurred and received over the long execution and selling duration. This also changes the project progress, and delivery time as well as their respective impact on customer degree of satisfaction. This research addresses the problem of selecting the best phasing alternative for real estate development projects while maximizing customer satisfaction and project profit.Design/methodology/approachThe research proposes a model that generates all construction phasing alternatives and performs decision-making to rank all possible phasing alternatives. The proposed model consists of five modules: (1) Phasing Sequencing module, (2) Customer Satisfaction module, (3) Cash-In calculation module, (4) Cost Estimation module and (5) Decision-making module. A case study was presented to demonstrate the practicality of the model.FindingsThe proposed model satisfies the real estate market's need for proper construction phasing plans evaluation and selection against the project's main success criteria, customer satisfaction and project profit. The proposed model generates all construction phasing alternatives and performs multi-criteria decision making to rank all possible phasing alternatives. It quantifies the score of the two previously mentioned criteria and ranks all solutions according to their overall score.Research limitations/implicationsThe research proposes a model that assist real estate market's need for proper construction phasing plans evaluation and selection against the project's main success criteria, customer satisfaction and project profit. The proposed model can be used to conclude general guidelines and common successful practices to be used by real estate developers when deciding the construction phasing plan. In this study the model is based on business models where all the project units are sold, rental cases are not considered. Also, the budget limitations that might exist when phasing is not considered in the model computations.Originality/valueThe model can be used as a complete platform that can hold all real estate project data, process revenues and cost information for estimating profit, plotting cash flow profiles, quantifying the degree of customer satisfaction attributable to each phasing alternative and providing recommendation showing the best one. The model can be used to conclude general guidelines and common successful practices to be used by real estate developers when tackling the challenge of selecting construction phasing plans.

A Real Option Analysis of the “Flats for Land” System - an Idiosyncratic Equity Financing Mechanism on Real Estate Investments

A typical real estate development project encounters an entrée capital expense for land purchase that is not immediately recovered until the allocated capital for the land acquisition is replaced with new capital that converts the land to a rentable building space. This article presents an idiosyncratic equity financing scheme that eliminates the sunk cost for a land purchase over a real estate development, within a real options framework. The study provides a model solution, numerical results of the option value, and the optimal investment threshold of a real estate development that is initiated through the “flats for land” scheme.

The Impact of AI Adoption on Project Scheduling Efficiency in Real Estate Development Projects in Nairobi

The adoption of Artificial Intelligence (AI) and Machine Learning (ML) technologies in real estate project management has resulted to the enhancement of project scheduling efficiency. As such, this study investigated how AI has enhanced the optimization of project schedules within the real estate sector in the Nairobi Metropolitan Area. A mixed research method approach was employed in which the research integrated qualitative data collected through interviews with project managers and quantitative data obtained from project records to evaluate the impact of AI on key scheduling metric. The metrics include Schedule Performance Index (SPI) and the Critical Path Length Index (CPLI). The findings of this study reveal that the adoption of AI can lead to tremendous improvements in scheduling efficiency hence leading to a reduction in project delays and thus leading to effective schedule adjustments. AI tools have also proven to contribute to better resource allocation and cost control which leads to smoother project execution. However, the adoption of AI still face challenges such as high implementation costs, data privacy concerns, and a shortage of skilled personnel. Therefore, this study concludes that while AI offers a greater potential in the enhancement of project scheduling, it is still worth addressing the identified challenges to be able to maximize its benefits. This study recommends that real estate companies should invest in AI training amongst its staff and also a cost-effective AI solutions for smaller firms should be developed to benefit all stake holders in the real estate field. There should also be a robust implementation of data privacy policies to improve the security of those using AI in managing their projects.

A Long Note on the Interaction of Performance Measures and Appraisal Techniques for Real Estate Development Projects

A Long Note on the Interaction of Performance Measures and Appraisal Techniques for Real Estate Development Projects

공동주택 개발사업 사례연구

Currently, the real estate PF market is exposed to uncertainty and volatility due to the high interest rate trend and housing recession. Accordingly, this study examined the real estate development project process and the risks of real estate PF by dividing them into financial, construction, and legal factors through a case study on the development of Ulsan District 2, and analyzed the real estate development project procedure and financing plan. In addition, we would like to consider the importance of indicators such as LTV and exit sales rate. First, through analysis of each major risk, we identified the risks borne by the financial institution and the developer, confirming that the case was a stable business structure with no significant uncertainty during the business period. In the case of real estate PF financing, we analyzed the cash flow within the business period of the case by reflecting cash inflow and cash outflow, and estimated that full PF repayment was possible upon completion. Meanwhile, the trend of LTV reduction when the sales rate increases was identified and the importance of LTV was confirmed in times of increased uncertainty in the housing finance market. The necessary sales rates for each scenario were presented through analysis of the exit sales rates of developers, construction companies, and financial institutions.

부동산 임대료의 현금 흐름에 대한 리스크 분석

Investment decisions in real estate development projects need to be made more flexibly in uncertain environmental changes such as legal and economic conditions in competitive business in the rapidly changing real estate market. In analyzing the economic feasibility of real estate development projects, the valuation method of the investment plans using the traditional NPV method is evaluated based on a fixed standard planned in advance. Therefore, it was not possible to flexibly cope with uncertain changes in the business environment. In the face of growing uncertainty in the real estate development market, a more sophisticated evaluation method that can evaluate investment plans is needed according to changes in the market. Accordingly, the valuation of real estate development projects was analyzed using real options approach. In this study, an analytical framework was presented to evaluate the return value of commercial rental properties from a financial engineering perspective and to analyze the risk of rent cash flows. Real estate rate assessment methods, risk analysis methods, rent derivatives valuation methods, and real estate option valuation methods were analyzed for uncertainty in rent, tenant residence, vacancy, and real estate price using Monte Carlo simulation. In terms of financial engineering probability models, research in the field of valuation and risk analysis of real estate is now in its infancy, and the framework for analysis itself is not sufficiently established. Based on these studies, various analysis methods will be developed, and in this sense, this study can play a fundamental role.

A Real Option Analysis of the “Flats for Land” System - an Idiosyncratic Equity Financing Mechanism on Real Estate Investments

A typical real estate development project encounters an entrée capital expense for land purchase that is not immediately recovered until the allocated capital for the land acquisition is replaced with new capital that converts the land to a rentable building space. This article presents an idiosyncratic equity financing scheme that eliminates the sunk cost for a land purchase over a real estate development, within a real options framework. The study provides a model solution, numerical results of the option value, and the optimal investment threshold of a real estate development that is initiated through the “flats for land” scheme.

Conceptual and analytical features of the attribution of multi-project activities of enterprises in the environment of construction development

The development of the state's economy depends on the efficiency of construction enterprises, as one of the indicators reflecting the state and trends of the internal and external economic environment. In the conditions of the functioning of construction enterprises, the importance of relations between the development of the construction and investment project and its stakeholders (project participants, interested persons) is increasing, which affect the resulting indicators as a complex set of organizational, factual and legal actions in the process of professional entrepreneurial activity aimed at creating and (or ) conversion of real estate objects for the purpose of obtaining profit from such transformations. In this context, it should be noted the decrease in the effectiveness of the interaction of construction developers, namely with customers of construction products, contractors, design organizations, competitors, public organizations. In such conditions, there is a need for the formation of theoretical and methodological foundations for the development and implementation of a stakeholder-oriented management strategy of construction enterprises as a method of organizing the investment process, which aims to organize financing and the implementation of a real estate development project within the given time and within the relevant restrictions in order to obtain a commercial benefits The article proposes a definition of the morphological classification of the essence of the concept of "development" in the construction industry on the basis of strategic contours and social directions and is determined by functional, resulting, structural, process, strategic, complex features, the relationships of which have a certain level of risk and threats. Risk and profitability are considered when forming an investment portfolio as two interdependent categories. The formalization of the amount of risk, which is evaluated according to the following parameters: the mathematical (average) expectation of the value of profitability, as well as the degree of variability of profitability, has been carried out.

Lean in the public sector in Finland.

Finland is undergoing an immense change in the execution of real estate development and construction projects. Since 2011 nearly 100 projects have already been launched in the country with the Integrated Project Delivery (IPD) principle. The total value of the projects is close to 7.3 billion euros. The principles of integration are currently applied especially to project management contracts, but also to other traditional contract models with fixed content or fixed price. Implementation of the IPD models has triggered a change in work culture and practices across the whole construction field. Focus within the traditionally somewhat quarrelsome and fragmented industry has now shifted towards cooperation and continuous improvement – both important Lean principles. Experience from the integration of contracting authorities and service providers has shown the advantages to be achieved. The contracting authority can utilize the know-how of different parties from the start of the project, as designers and builders are planning ways of execution together. A joint development phase leads to better planning and more accurate budgeting as well as better commitment of different parties. The use of IPD models has also served as a significant basis for introducing Lean principles and tools in Finland. Without IPD models, especially the customers' awareness of the benefits of Lean methods would have remained low. Furthermore, the sharing of risks and benefits encourages the execution of projects with stricter adherence to budget and schedule. So far, all completed IPD projects have achieved the target schedule and budget. Despite minor shifts in the cost targets of the projects, all contracting parties have been satisfied with the achieved results.

Retracted: Optimization of Tourism Real Estate Development Project Based on Option Premium Model

Retracted: Optimization of Tourism Real Estate Development Project Based on Option Premium Model

공공개발사업의 추진 여부에 영향을 미치는 외부 요인에 관한 연구

This study tried to find out how the external environment is affecting the promotion of public development projects among real estate development projects. To this end, additional environmental factors such as location adequacy review and consideration of similar facilities and competitive facilities, which are considered similar to the purpose of this study, were examined among projects subject to central investment review. 138 data were used in the analysis over five years from 2017 to 2022, and the presence or absence of basic infrastructure, including environmental factors within a radius of 5km, the surrounding environment and conditions such as competitive facilities were identified, and what factors affected the passage of the investment review. As a result of conducting a technical statistical analysis before the full-fledged empirical analysis, 99 projects (71.7%) passed the central investment review and 39 projects (29.3%) failed to pass. The total project cost was 32.2 billion won on average, and the average total floor area was 11,852.28㎡, indicating that most of them were large-scale projects. In the case of transportation facilities, 73 (52.9%) project sites with subway and train stations within a radius of 5km were found.

University as real estate developer: Comparative perspectives from the Global East

By examining comparatively two recent projects of university-led large-scale real estate development in South Korea and Singapore, this paper contributes to the ongoing efforts to problematise the methodological statism in the study of East Asian urbanisation, i.e., understanding it as a process dominated by state actors, on the one hand, and to challenge the perspective that university-led real estate projects are a neoliberal strategy as conventionally understood in the West on the other. To this end, this paper uses qualitative research methods to investigate how and why East Asian universities participate in real estate development projects; how the universities pursue their material goals by negotiating with the state, which is known to have led condensed urbanisation and industrialisation in East Asia (Global East). This paper concludes that speculative real estate development activities of East Asian universities are variegated based on their developmental legacies and need to be understood as more nuanced processes. The case studies demonstrate that East Asian universities have worked beyond their social roles by directly participating in the urban process, pursuing the accumulation of real estate assets that would eventually undermine their public role as educational institutions.