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Flexibility and Real Estate Valuation under Uncertainty
book

Flexibility and Real Estate Valuation under Uncertainty

by David Geltner, Richard de Neufville
April 2018
Intermediate to advanced content levelIntermediate to advanced
256 pages
7h 35m
English
Wiley-Blackwell
Content preview from Flexibility and Real Estate Valuation under Uncertainty

23Optimal Phasing: We Now look at Adding Phases, Delineating Phases, and Distinguishing them from Expansion Options

In this last chapter of our exploration of the value of flexibility in real estate development projects, we tie up a few loose ends having to do with project phasing. The overall question is: What is the best way to design and program the phases in a project?

  • We begin with a natural follow‐up to Chapter 22. Since it is good to divide the project into two sequential phases, would it be even better to have three phases (holding the overall scale of the project constant)?
  • Second, how should we delineate between phases? That is, how much of the project should we put in one phase versus another, especially in the first phase versus later phases?
  • Finally, our analysis of phasing begs a broader question—one that relates back to our typology of development flexibility, introduced in Chapters 1315. What is the difference between a later “phase” versus what we described as an “expansion option”? We shall see that the key is in ...
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Publisher Resources

ISBN: 9781119106494Purchase book