2 (ii)A newer city has grown rapidly over the years with a modern housing stock that has

almost a constant FAR of 0.5 from its center to the edge at 20miles. A regression equation

has estimated the following relationship for the price/sqft of housing floor area:

P = 140 - 2t - 2FAR

where: P: price/sqft of floor area FAR: floor/land area ratio

t: distance from the CBD If construction costs are 100/sqft,

Given:

P = 140 - 2 t - 2 FAR

where:

P: price/sqft of floor area

AR: floor/land area ratio

t: distance from the CBD, if construction costs are 100/sqft ,

So now FAR = 0.5 , T = 20 miles

P = 140 - 2 (20) - 2 (0.5)

P = $99

Square Foot Of Vacant Land Potentially Worth At The Center Is 99 Squares.

Question:

Since there is no vacant land currently, would it be profitable to redevelop sites at the

center & how profitable is redevelopment?