The prudent landowner or developer on any size of project will inevitably want to maximise profits, minimise risk and control his cash-flow. This is a process called Profit Enhancement. This means identifying and developing the best scheme for the local marketplace, whilst satisfying the local planning process. Essentially, Development Analysis puts development prospects, and the development process itself, under the microscope, identifying exactly where enhancements and improvements can be introduced. These improvements aim to align with best design practice, political sensitivities, and the inevitable social requirements of a project, with the overarching objective of increasing land values and profit margins on behalf of the landowner or developer.
Development Analysis can add significantly to the value of land and development, and as such is becoming a crucial weapon in the landowners and the developer’s armoury. It is an essential step in Kevin A. Lynches (1960) book The Image of the City, and is considered nowadays to be an essential step to realising the value potential of land. The landowner can share in additional planning gain (significant value uplift) via an awareness of the land’s development potential. This is done via a residual development appraisal or residual valuation.