Feasibility Study for Shopping Mall

If your company is considering developing land for a shopping mall and needs to
ascertain whether the project is viable, our team at Prospectus.com can assist with your
property feasibility study. Property and development feasibility study analyses are
common for companies to create prior to breaking ground on a construction project. The
report will give needed insight to the principals who can then determine whether their
project is even ‘feasible’ to continue.

Our seasoned management team employees consultants and engineers to assist with a
feasibility project, anywhere in the US and beyond. Our fees are highly competitive and
our time frame for completion of such projects is faster than most industry firms, giving
our clients a needed advantage when deciding to undertake a real estate or land
transaction. Indeed, scores of firms outsource their work to our group as we are known
as straight forward and adhere to all budget requirements.

Important Prerequisite for Real Estate Developments

Before spending needed capital on a real estate project, many companies will first need
to define their business model. But almost simultaneous to a business plan would be
the writing of a feasibility study. Although the costs associated with a feasibility analysis
can seem pricey at first sight, not having such a report provided can cost companies
many times the amount in loses if a project goes bust. In most cases, such pitfalls can
be avoided by writing a feasibility study, especially for property development.

There can be little room for errors when dealing with a land development. Incorrect
assumptions on zoning laws or the structural engineering design can bankrupt a real
estate project. A feasibility study will outline the requirements needed in order to
successfully navigate the many issues that arise in real estate development, whether
constructing from the ground up, or tearing down an existing structure and then
rebuilding.

Development Assessment – Land and Property

Most real estate firms will conduct a property assessment or a land assessment before
committing to development. Such a an assessment will determine if the project is even
‘feasible’ or worth the time and money to continue. A feasibility plan or development
assessment for real estate or construction will also outline the costs associated with the
overall project. In some feasibility studies, there will also be sales forecasts based on
comps, whether for single family or condo home sales, or hotel occupancy rates. The
land and property feasibility study development assessment will help clarify the budget
and give needed insight into the potential revenue streams as well as the costs
associated with construction.

Feasibility Study vs Business Plan

A business plan is regarded as a road map of sorts. For any business to succeed they
must understand their market, their numbers, and the opportunity. Business plans are
utilized for all types of businesses, including real estate and development related
projects. A feasibility study is like a business plan in that it outlines the overall
opportunity and allows for an educated decision about whether to move forward or not.
As such the feasibility study is the ‘business plan’ for a land or property. Said another
away, if the proposed development of land or property had a business plan, it would be
called a ‘feasibility study’. Both are imperative for any project to succeed, and certainly
to raise capital.

What’s Included in a Feasibility Study

A feasibility entails many aspects of a real estate development project. Whether one is
developing a hotel or many single-family homes, or a school, the report will outline
anything from the permit process to the land usage rights. Below are some, but not
nearly all, features of a real estate feasibility study report, all of which can be classified
as undertaking due diligence before construction begins.

 Civil Site and Public Infrastructure Improvements

 Land Use and Environmental Permitting
 Geotechnical Investigation
 Structural Engineering
 Environmental Study and Report
 Survey (boundary, title research)
 Site Planning, Development Program, and Code Review/Compliance
 Traffic Plans, Neighborhood Impacts, Schools in the Area
 Water/Sewage
 Architect
The aforementioned points are just a glimpse of the many features of a feasibility study.

Why Write or Make a Feasibility Study?

There are numerous benefits to creating a feasibility study. First and foremost, you
would want to ensure that you can actually develop on the proposed land. The property
zoning laws may permit or prohibit certain features of the project, such as the height
and size of the development. Here are few main reasons for preparing a feasibility study
for a real estate development project.

 Knowledge: As noted above, knowing whether you are allowed to develop and
under what terms will save needed time and capital. If a negative picture is portrayed,
then you would stop development. If positive news transpires from the feasibility
report then you would continue. Knowing the options is more than half the battle.
 Property Assessment: Before committing capital to any development you would
ensure that the concept itself is viable and therefore tested. Conducting a land
assessment prior to development can save the company money and time.
 Project Confidence: Similar to writing a business plan, a feasibility can give the
principals the needed confidence boost to move forward with the project. If the
feasibility report shows promising results, both financially and strategically, this can
give convince the team that their assessment for development is correct. This can
help when capital is needed to be raised or allocated from investors. A confident
management team, with a factual feasibility document in hand, can add great
strength to the company’s mission.
 Funding and Capital Raising: As noted, a well written feasibility study, similar to a
well written business plan or prospectus, can aid in the strength of the business and
 alleviate fears from investors and lenders. While the feasibility study is usually
prepared for the management team to decide if the given project is even feasible to
develop, the document itself can be used as a powerful tool when raising capital and
approaching investors.
Financial Feasibility Study for Property Development
During the initial phases of the feasibility study’s development, the writing of the
financial projections and budgets needed to implement the feasibility study would be
undertaken. Creating the financials at the onset of operations will also benefit the
company in terms of making the correct decisions moving forward. If the numbers do
not make sense then the project would end. If the numbers work then the project would
continue. All the more reason why this feature of the property feasibility report is
conducted at the beginning of the process and not the end.

Since the outcome of any business – real estate related or not – is to make a solid
return on investment, knowing the ins and outs of the financial feasibility study of the
development project makes it imperative to create such a report. Here is some
information on the development steps of a property according to the financial feasibility
report protocols that Prospectus.com and our clients would undertake together:

Initial Concept Meeting

We would discuss usually via phone (or in person if needed) the project’s details and
your needs.

Land and Project Evaluation

Prospectus.com’s team would be undertake an analysis of the overall land and site,
including:

 Zoning law
 Land and physical restrictions
 Traffic and access points
 Buildings in the surrounding environment
 Sewage and water
 Competitive summary of new projects and similar existing developments
Description of the Development and Industry Insights

A thorough description of the usage of the land along with the overall industry would be
discussed.

Market Analysis

A comprehensive market analysis would be undertaken as well. The market analysis

section will detail needed information about the market opportunity’s strengths and
weaknesses, including:
 Population of the surrounding area and trends, including projected growth
 Age of the demographic and target market
 Income statistics
For tourist developments, additional market characteristics would be detailed, such as:

 Existing market size

 Historical numbers and market growth
Market Comparison

In addition to the demographics, a feasibility study would examine existing structures or

buildings in the near vicinity of the projected land development.  Information would
include:

 The location of a similar project

 Development similarities and project description
 Historical financials and pro formas, if available
 Proposed construction costs
Yearly Project Usage Analysis

A detailed summary of the proposed project, usually over a 5 year period. The yearly
analysis will include:

 Market size, demographics, etc.

 Competitive analysis
 Analysis of existing similar projects and their positioning
 Project location and parts needed to complete project
 Concept Development and Planning for the Project
Prospectus.com’s team and engineering group would create the necessary plans to
market and supply the target market and its future growth. We assist with master
planning, as well as the architectural and design plans, including suggesting:

 The types of services offered

 The overall size and functions of the space
 Land and property needs
 Architect plans, diagrams, graphics, videos, pictures, power point presentation or
investor deck
Financial Analysis

A comprehensive real estate financial analysis of the proposed project would be

undertaken at this point. The projections would normally take into account the
consecutive 5 years, however projections for 10 years out is also common. The
financials would include:

 Revenue projections, proforma statements

 Budget expenses, operating projections
 Profit and loss
 ROI
Project Expenses – Development Recommendations

Prospectus.com will allocate an expense analysis for the entire project. We will give our
opinion regarding the feasibility of the overall project.

Preliminary Property Development Feasibility

Often, prior to a comprehensive feasibility study being written or prepared, a preliminary
property development feasibility study is written. For those who do not want to spend
capital on a more thorough feasibility study, the preliminary report can serve an
important function. While it is not as thorough as a feasibility study, the preliminary
report will note the costs associated with preparing a full feasibility study. For example,
a company that wants to do build a hotel has a $10,000 budget. They do not yet want to
pay for a full feasibility study as they would first need to know the costs involved. They
would pay for a preliminary property development feasibility study and in this report we
would outline the actual costs associated with creating a full comprehensive feasibility
assessment report.

Prospectus
Our team at Prospectus can assist with either a preliminary feasibility study or a
comprehensive feasibility analysis report. Feel free to reach out to us any time for a free
consultation.

Contact Us for a Free Feasibility Study Consultation

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 Prospectus Writing
 IPO Stock Exchange Listing
 Bonds Offerings
 Feasibility Study
 144A Reg S Offerings
 Hedge Funds and Mutual Funds
 Offering Memorandum
 Private Placement Memorandum
 Offering Circular
 Explanatory Memorandum
 Information Memorandum
 Fund Setup Formation
 Securities Identifiers
 Registration and Filing
 Legal Work
 Valuations
 Escrow Services
 Business Plans
Feasibility Study for Shopping Mall