Real Estate Development Analysis
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LAMBCHOP DEVELOPMENTS
DEVELOPMENT COMPARISON
INTRODUCTION
This report provides feasibility, cash flow and various risk analysis of the returns of two proposed developments with consideration for both Lambchop Developments, and for possible equity investor, Idaho Investments. The report will provide a summary of the analysis, a comparison of the developments and will make recommendations as to which development is most suitable both for the developer or investor.
Target rates of return have been established by both parties and are as follows:
Lambchop Developments
Profit and Risk Requirement 23%
Development Target Rate of Return 40% Idaho Investments
Before Tax Equity Return 15%
The first is a redevelopment of 60 Mill Point Rd, South Perth, from its current commercial use, to accommodate 12 luxury apartments and 2 super luxury penthouses over a total of 8 levels. The second a mixed retail and office development in the prime office location of West Perth, offering 6,000m2 of premium office space over 6 levels and 1,000m2 of retail space.
DEVELOPMENT ONE
LUXURY RESIDENTIAL APARTMENTS
60 MILL POINT RD, SOUTH PERTH
DEVELOPMENT OUTLINE
Lambchop Developments has collaborated with the South Perth Redevelopment Authority with the prospect of redeveloping 60 Mill Point Rd, from its current commercial use. The site will be redeveloped to accommodate 12 luxury apartments and 2 super luxury penthouses over a total of 8 levels. The location of the proposed development, South Perth has evolved into an exclusive residential suburb due to its location near the Swan River and its easy access to Perth’s CBD, as such shows high demand for luxury apartment style accommodation. A resources boom in Western Australia has seen an increase in population and substantial flow of capital into the local property market, leading to both significant rental growth and increases in residential apartment values. Such activity would see apartments in the
LAMBCHOP DEVELOPMENTS
DEVELOPMENT COMPARISON
INTRODUCTION
This report provides feasibility, cash flow and various risk analysis of the returns of two proposed developments with consideration for both Lambchop Developments, and for possible equity investor, Idaho Investments. The report will provide a summary of the analysis, a comparison of the developments and will make recommendations as to which development is most suitable both for the developer or investor.
Target rates of return have been established by both parties and are as follows:
Lambchop Developments
Profit and Risk Requirement 23%
Development Target Rate of Return 40% Idaho Investments
Before Tax Equity Return 15%
The first is a redevelopment of 60 Mill Point Rd, South Perth, from its current commercial use, to accommodate 12 luxury apartments and 2 super luxury penthouses over a total of 8 levels. The second a mixed retail and office development in the prime office location of West Perth, offering 6,000m2 of premium office space over 6 levels and 1,000m2 of retail space.
DEVELOPMENT ONE
LUXURY RESIDENTIAL APARTMENTS
60 MILL POINT RD, SOUTH PERTH
DEVELOPMENT OUTLINE
Lambchop Developments has collaborated with the South Perth Redevelopment Authority with the prospect of redeveloping 60 Mill Point Rd, from its current commercial use. The site will be redeveloped to accommodate 12 luxury apartments and 2 super luxury penthouses over a total of 8 levels. The location of the proposed development, South Perth has evolved into an exclusive residential suburb due to its location near the Swan River and its easy access to Perth’s CBD, as such shows high demand for luxury apartment style accommodation. A resources boom in Western Australia has seen an increase in population and substantial flow of capital into the local property market, leading to both significant rental growth and increases in residential apartment values. Such activity would see apartments in the