Real Estate Development Projects Research Articles

From Order-Qualifier to Order-Winner? Servitization Value Chain and the real estate development projects

This paper investigates the value of servitization in the context of real estate development projects. A qualitative case study research approach is adopted, and the principles of the Delphi study applied. The findings indicate that the outputs of the real estate development projects have become systems of both project components and added services. These systems are the result of servitization strategies in the real estate development projects that shift the industry focus from only designing and selling a physical output to delivering a system of services integrated to the project, which together are capable of adding more customer value. The research identifies several types of services, which are used to develop four categories of servitization in the real estate development projects. The research develops the value chain of servitization strategy and it was found that offering services in real estate development projects is an incremental process; offering basic services (order qualifier) adds additional value for customers and makes the project ‘more’ valuable. However, basic services will not ensure competitive success. More advanced services such as customer-orientated-services need to be provided to enhance the project’s competitive advantage (order-winners).However, it the system solutions that shape the order-winning criteria of the construction industry.

Classification of Risks in Real Estate Development Business

Risks generally denote the negative impact to the real estate project’s progression in regard to these will affect to the construction schedule, project cost and the quality of the products. This article highlights the importance, consequences and impacts of risks in the real estate development projects. This article also classifies risks in the general business, and then focus specifically on those in the real estate business, then it provides the academic and practitioners term of risks as well as define the risks those involve in the real estate business. The risk classifications in this article will be used to support and establish the risk assessment criteria based on the definitions of Social, Technological, Economic, Environmental and Political factors or STEEP factor, which is popularly used in the general and real estate business.

Recommendations for Target Value Design implementation for real estate development in Brazil

ABSTRACTTarget Value Design (TVD) is a management practice used in programing, design, detailing and construction to ensure that projects meet the operational needs and values of its users. A literature review revealed that TVD has been primarily studied in a narrow and specific context, and there is still a lack of TVD information as it relates to real estate development. This work aimed to evaluate the project definition and design phase of a real estate development under the framework of TVD theory, and propose guidelines for the implementation of TVD practices. This research, which was based on a case study in Brazil, involved the following stages: (a) understanding the real estate project definition process based on TVD theory, (b) evaluating the level of TVD application, and (c) analyzing the potential for implementing TVD practices. The primary findings identified the weaknesses and strengths of the project phases and processes, and then analyzed the viability of TVD implementation in real estate development. The theoretical contribution of this study is a better understanding of how TVD can be translated to and used in a new context. For practical implications, a set of guidelines is proposed for the implementation of TVD within real estate development contexts and projects with similar characteristics.

REIT Financing of Real Estate Development Projects in Nigeria: Why Not?

This study appraised the investment option of REITs directly financing real estate developments within the REIT investment guidelines in Nigeria. The focus is to grow the real estate sector of the emerging Nigeria REIT market, especially where there exists a low stock of real estate assets. Asset allocation strategy of the modern portfolio theory anchored on the Markowitz’s efficient frontier model was adopted taking into consideration the REIT regulations in Nigeria. The study found that Nigeria REIT can adapt real estate financing as an option of investment diversification because of the potential return benefit exhibited with an efficient REIT portfolio of 70% real estate acquisition, 20% construction finance and 10% financial deposit asset allocation strategy, yielding a return of 8%, which was 89% higher than the 4.23% maximum return of 100% asset in real estate alone. The study provides an insight into the developing Nigeria REIT market and recommends a review of REIT law to encourage REIT investment into direct construction financing in other to grow property stock in the emerging real estate markets to a sustainable level.

Organizational Aspects of Development Projects Implementation at the Real Estate Market in Ukraine

The article is dedicated to the issues of improving a system of organizational providing of investment constructional activity at the real estate market of Ukraine. The authors suggest modern approaches to organizing different stages of investment and construction process. In particular, legal bases for organizing real estate development project concept design stage are analyzed and the ways of permissible procedures simplifying in construction are defined. Suggestions concerning choice of approaches to evaluating real estate projects development effectiveness of realization are made, where an important place belongs to development land improvement estimation. Real estate development project estimation methodology for various real estate types considering special aspects of conducting marketing research is offered. The article conclusion contains means recommended for implementing by real estate development organizations while designing their strategy of development.

부동산 프로젝트파이낸싱의 고도화 - 부동산신탁회사의 신용보강을 통하여 -

Korean people show high interest in real estate ownership, and Korea is the top OECD country in terms of the share of real estate in private individuals’ asset portfolios. Currently, the Korean government implements risk management policies against increased household debts, and, among others, imposes restrictions on investment in real estate, such as mortgage loan regulations and public housing site reduction. As a result, the real estate mortgage financial market has been tightened, and naturally the real estate development business sector has also been affected. Given the real estate market situation, it becomes increasingly difficult for real estate developers to finance their projects on the basis of their credit alone. In this context, it becomes a trend in the development project financing market that risk associated with real estate development project financing is distributed through the credit enhancement of companies concerned in development projects, such as developer, constructor, trust company, and financial institution. Therefore, this paper introduces a system of carrying out a development project in the real estate market through financial structuralization that distributes risk associated with the insufficient credit of every party from financing to finishing; and discusses about the validity of this structuralization product. And futhermore, it intends to seek the sophistication of real estate project financing through the structuralization of real estate finance.

중국부동산개발의 특수인허가 심사 영향분석: 초한심사, 인방심사

중국부동산개발의 특수인허가 심사 영향분석: 초한심사, 인방심사

A Study on the Quantitative Evaluation of Products in Real Estate Development Projects Using ANP

Real estate development significantly influenced by external factors such as international macro-environment, domestic and international real estate markets, public policy, and the financial market has high risks to fail since business process is complicated, and potential risks are various depending on the type of business and participants of business. The purpose of this study is to suggest basically considering criteria when assessing values of real estate development business. For doing this, quantitative indicators are developed by experts’ verifying internal values only focusing on a businessman’s subjective opinion in real estate development. Through ANP, a way of the strategic decision, 6 upper basic items and 18 low detailed items were classified depending on the relative importance of factors, and weights as for these indicators were yielded. Upper basic items yielded 6 basic value items; ‘price value’, ‘time value’, ‘location value’, ‘the value of a concept’, ‘the value of quality’, and ‘rarity value.’ It was found that of them, the most considered item was location value. The significance level of 18 detailed indicators, which represented an indicator of the value evaluation of the product in real estate development, was analyzed. The result showed that ‘regional location value’ was ranked in the first place, and ‘area for exclusive use’, ‘the value of location for land use’, ‘metropolitan location value’, ‘future value’, ‘the time of selling lots’, ‘supply area’, and ‘multiple time’ were ranked in order. However, the values of the rest 9 detailed items that are out of the ranking, had more than 25% weights of overall values. Therefore, when the value of products in real estate development is evaluated, low detailed items should be importantly considered.

Application of DSM in process management of a PE commercial real estate development project

PurposeAfter the drawbacks in the process management of China PE commercial real estate development project are analyzed, it is necessary to introduce a more integrated and advanced tool to solve them. The paper aims to discuss this issue.Design/methodology/approachA standard process model was proposed first. Based on the model, a coupled activity dependency model was also built by structural tool design structure matrix (DSM), the detailed matrix involving 119 activities and 322 information dependencies. Next, two large processes coupled blocks were generated by the sequencing algorithm and tearing algorithm. Then, the general simulation framework with rework probability and rework effect was introduced to do empirical research for one of the activities blocks due to the merit of solving rework of DSM.FindingsThese results showed that key activities were rearranged, that information interactive scope for them was optimized and that collaborative organization interface was built. And the expected duration after simulation was 131 days at 90 percent percentile, providing the objective basis of process arrangement to some extent and decreasing the risk of prospective yields during fund period.Originality/valueThis paper is a qualitative and quantitative practical research for the process management of PE commercial real estate development projects in China based on a real project which has begun construction in 2014.

Organizational and technological genesis as a tool for strategic planning of large-scale real estate development projects

Conceptual planning and implementation of large-scale real estate development projects is one of the most difficult tasks in the organization of construction. In the Russian practice, a large experience of development, complex reorganization and redevelopment of large development areas is accumulated. The methodological basis for solving similar problems is the organizational and technological genesis, which considers the development of the project during the full life cycle. An analysis of this experience allows us to talk about the formation of new and effective approaches and methods within the organizational and technological genesis. Among them, the most significant and universal approaches should be highlighted: The concept of real estate development, which explains the reasons and objective needs for project transformations during its life cycle, as well as to increase the adaptive capabilities of design decisions and the project's suitability for the most likely future changes; Development project of joint action, which is based on the balance of interests of project participants; Master planning of the life cycle stages of the project and subprojects, based on the rethinking of the theory and methods of the construction organization, and allowing rationally localized construction sites and related subprojects, while retaining the remaining development and development area beyond of the negative effect of construction for comfortable living and work.

Modeling an Individual and Group Decision on the Implementation of a Real Estate Development Project

The implementation of the real estate development project are accompanied many management decisions. These decisions can be made by one person or a project team. The article describes the advantages and disadvantages of individual and group decisions. The results of a comparative research of decision-making by one person and a group using computer decision support systems and without them. It is shown that using of automation tools facilitates decision making and increases confidence in its correctness. It has been experimentally proved that the individual solution is based on a smaller number of factors, is accepted more quickly and more satisfied by the person making the decision, in comparison with the group decision. Further the difficulties in implementing computer decision support systems in the work of a development company and acquired benefits are listed.

Research on the optimization of quota design in real estate

Quota design is one of the effective methods of cost control in real estate development project and widely used in the current real estate development project to control the engineering construction cost, but quota design have many deficiencies in design process. For this purpose, this paper put forward a method to achieve investment control of real estate development project, which combine quota design and value engineering(VE) at the stage of design. Specifically, it’s an optimizing for the structure of quota design. At first, determine the design limits by investment estimate value, then using VE to carry on initial allocation of design limits and gain the functional target cost, finally, consider the whole life cycle cost (LCC) and operational problem in practical application to finish complex correction for the functional target cost. The improved process can control the project cost more effectively. It not only can control investment in a certain range, but also make the project realize maximum value within investment.

Systems engineering real estate development projects

In recent years, real estate development has accumulated a wealth of experience in implementing major projects, which requires comprehension and systematization. The scientific instrument of system engineering is studied in the article and is substantively interpreted with reference to real estate development projects. The most perspective approaches and models are substantiated, allowing strategically to plan the life cycle of the project as a whole, and also to solve the engineering butt problems of the project. The relevance of further scientific studies of regularities and specifics of the life cycle of real estate development projects conducted at the Moscow State University of Economics and Management at the ISTA department is shown.

Collaborative development: Capturing the public value in private real estate development projects in Ho Chi Minh City, Vietnam

This article addresses a relative gap in the literature on real estate development and property rights in transitional economies, particularly on the “shadow” role of private developers in urban management at the local level. The paper argues that the development of high-rise buildings in Vietnam resulted from the national privatization policy shift known as Doi Moi that gave landowners greater rights. These changes in land rights policy are important constitutive elements for institutional functionality of value capture via privatization of land, to become viable and effective. Further, the paper describes how private developers (foreign and domestic) take advantage of vague and indistinct city governance regarding privatization of land, while the property rights of the original users of the land are insufficiently protected. These issues are illuminated and analyzed through the use of three case studies of commercial projects in Ho Chi Minh City. We suggest a further institutionalization of privatization of land and value capture in Vietnam.

Back to School: Real Estate Development of Off-Campus Student Housing

Christopher Lenard and his longtime friend, Kimberly Slater, are exploring the idea of developing a student-housing complex near the University of Wisconsin, Madison, by replicating Slater's highly successful, similar development near the University of Florida. Madison seemed to present attractive market and demographic conditions for investment in student housing in the summer of 2012. But before committing a large share of his personal wealth to the project, Lenard needs to conduct a more careful analysis of its potential risks and returns. By putting themselves into the shoes of a budding real estate entrepreneur, students will evaluate both the merits and pitfalls of various approaches to the financial analysis of real estate development projects.After reading and analyzing the case, students will be able to: Evaluate the fundamental economic determinants driving the potential gains to real estate development Explain the merits and deficiencies of tools that can be applied to the financial analysis of real estate development projects, including financial feasibility; developing to a yield on cost; net present value analysis; and real options.

Development of Basic Adaptive Model of the Real Property Item as a Support System for the Development Project

The article describes the method of the detailed description of the item, as a basic managed element of the real estate development project. A mathematical adaptive model of development, which can influence on right organizational-managerial decision-makings on the stage of pre-investment research, was proposed on the basis of consideration of the set of characteristics and diversified features of the item, as well as its ability to self-development. The result of the work can be used as the base model in the design of decision support system in the initiation of the development project.

Design idea on planning skill training system of real estate development projects in colleges and universities

The planning skill training of the real estate development project in colleges and universities is an important means for the students majored with the real estate operation and valuation to master it. According to the in-depth researches of the real estate developers and many years’ teaching experience, we put forward the design idea of the skill training system. This idea contains three steps: design of training content, design of training mode and design of training system. This idea is helpful for building a sound training system, and is also helpful for the students to effectively carry out skill training, successfully achieve the goal of mastering the vocational skills, and increase the competitiveness of employment after graduation, thus playing a very good reference role in the development of other vocational skill training systems in colleges and universities

GIS技术在房地产开发项目选址中的应用

房地产具有很强的区位性，其开发投资量大、回收周期长，项目选址的正确与否在房产开发直至销售的全过程中至关重要。本文将GIS软件应用于房地产住宅开发的项目选址决策中，在分析了空间统计方法的基础上，针对住宅项目选址的模型，以珠海市中心城区为研究对象，基于珠海市土地利用规划，从交通便捷度、人口聚集度和房价水平这三个重要指标探讨GIS技术在房地产开发项目选址中的重要作用，从而减少房地产开发项目决策的盲目性，为房地产项目开发提供科学的选址决策依据。 Real estate is strongly regional, with the characteristics of big investment and long recovery period. Whether the location of the project is correct or not, is of vital importance in the whole process of real estate development until the sales. This paper applies GIS software to site selection of resi-dential development project. Based on the spatial statistical methods, aimed at site selection model of residential project, this paper takes Zhuhai city center as the research object, and based on land use planning, discusses the importance of GIS technology in site selection of real estate development project from three important indexes: transportation convenience degree, population concentration degree, and house prices level. Therefore, these can reduce the blindness in decision-making of real estate development project, and provide the scientific location decision- making basis for the development of real estate project.

다중 실물옵션을 활용한 시나리오기반 부동산 개발사업 가치평가 연구

Abstract : Real estate development requires significant amount of capital investment. The project duration has been increased according to its enlarged size. For this reason, cost overrun and time delay are important risk factors that should be managed properly. As a method to hedge the risk, various real option methods have been presented. However, conventional project value assesment methods such as NPV(Net Present Value) have weakness to support decision making by reflecting dynamic situations in terms of variation of cost and time. Furthermore, the decision making process is serious of actions rather than discrete event. The purpose of this paper is to present a multiple real option valuation method to overcome the deterministic aspect of real option presented in previous research and practice. The method is developed as following: firstly, to select the model that can be applied in the real estate development project through a survey from previous literature on real options analysis; secondly, to apply data from office development case in order to verify the model by applying conventional real option and multiple real option valuation. According to analysis result, multiple real option provides enhanced values comparing to NPV and single real option.

Governing Growth

On 24 April 2013, Rana Plaza, a nine-storey building that housed five garment factories, a commercial bank and several retail shops, collapsed, killing more than 1,100 people. Had Bangladesh’s well-regarded building code been enforced, the tragedy would never have occurred. Through an exploration of the process by which real estate development projects are approved and building construction overseen, this article attempts to provide an explanation for why there is such a wide gap between formal policy and actual implementation. Following such tragic events, elected officials come under considerable pressure from civil society groups and citizens to pass stronger legislation, and Bangladesh’s political system, which concentrates power in the majority party and that party’s leadership, allows for the relatively easy passage of legislation. Nonetheless, dramatic population growth and limited availability of land create powerful incentives for developers to evade these regulations. Collusion between developers, the regulator and high-level government officials responsible for overseeing the regulator has ensured that both the laws and court orders are unenforced.