Introduction to Commercial Real Estate DevelopmentUsing the Pencil Test, you've now calculated the effective gross income, operations expenses, development costs, and the cost of capital for Project 5789. Based on this analysis, you have the critical information you need to determine the feasibility of the project.

In this part of the course project, you will summarize your findings on Project 5789 by crafting a memo to the owner of the development firm. In the memo, you will describe the project vision and concept, the project scope, key findings from the location and site analyses, and the project feasibility, providing your recommendation on whether or not to proceed with the project.

Note: Before beginning this portion of the project, you should have completed the quizzes in the course using the Pencil Test spreadsheet. It is important that your results for Project 5789 are accurate because this information contributes to your recommendation on project feasibility.

Course Project

Instructions:

Working through this project, you willperform some of the critical activities involved in the initial phases of the real estate development process using the case study of Project 5789, a proposed multi-use development project. In conjunction with the self-check quizzes in the course, you will have the information necessary to make an initial assessment of the preliminary feasibility of this project.

In Part One of the project, you will analyze the real estate market, determine how the developer's objectives align with the municipality's objectives and market demand, and review critical findings from the location analysis.

In Part Two of the project, you will review a video of a proposed site for Project 5789 and complete portions of a site analysis, and identify the primary the advantages and disadvantages of the site.

In Part Three of the project, you will summarize the findings from the analyses of Project 5789 for the owner of the development firm. Specifically, you will complete portions of the Development Package, including a brief summary of the project vision and concept, project scope, the location and site analysis, and the project feasibility, based on the Pencil Test.

Once you have completed all three parts of the project, submit this project document and any supporting documents to your instructor for grading. A Submit button can be found on the Part Three assignment page. Information about the grading rubric is available on any of the course project assignment pages online. Do not hesitate to contact your instructor if you have any questions about the project.

Part One - Analyzing the Real Estate Market, Development Strategy, and Location

Review the information in Part One of the Project 5789 Case Study document, including the location analysis, then answer following questions:

1. Based on the information presented in the case study and location analysis, where do you think Ithaca is in the real estate cycle? Provide three specific aspects in support of your assessment.

1. How does this location fit with the developers' objectives and strategy? Provide at least three specific reasons for your answer.

1. Provide two items from the location analysis that support development in Ithaca and two items that might be problematic.

Part Two - Perform a Site Analysis for Project 5789

In this part of the project, you will complete portions of the site analysis for the 5789 Project based on the video on the page "Watch: Exploring a Site for Project 5789" and Part Two of the Case Study document that you can download on the Project page in the course.

In the table below, complete the Description and Analysis columns for the following components: Visibility and Access, Proximity: Pros, Proximity: Cons, and Contextual Response.

Site Analysis for Project 5789

Component	Description	Analysis
Intrinsic
Current Conditions Describes what is happening at the site such as existing structures, soil condition, ecological issues, vegetation, water resources	The site is located directly on the Commons walking district. There are older buildings on the site with possible historic status. It is an urban site, with no "natural" ecological characteristics (wetlands, vegetation). Soil conditions are currently inaccessible and unknown.	The developer needs to check on the historic status of the buildings or area to determine if there are any special permits or requirements. Soil conditions require expert local knowledge to provide a preliminary analysis.
Size & Configuration Dimensions and shape of site, such as a simple rectangle or an odd or complex shape, which could cause design issues	The site dimensions are 130'x170' and is rectangular in shape.	It doesn't appear that the size or configuration will pose any issues for development.
Topography Flat vs slope site, which can affect design decisions and cost	The site is flat.	The flat site makes it a less complex place to build.
Visibility & Access Can the site be found and seen from cars or pedestrians? Is it easily accessed from the highway, street, or sidewalk?
Views from the Site What can be seen from the site? Is there a view of prime value? Is there future development that may block or enhance views?	Views from the site are limited to the view of the Commons. From the top floor of the building, parts of Cornell University may be visible.	The views from the site may not be a huge selling point but it doesn't detract from the project either.
Orientation Primarily to sun and winds. Is there good natural light? From what direction does the sunlight come? Are there constant prevailing winds?	The orientation is clearly north and south with the Commons on the north side.	The front (north) side of the building will be in shade most of the time. On the back (south) side of the building, anything taller than the parking garage will be in the direct sun. Sun and natural light are desirable for housing and office tenants.
Extrinsic
Proximity: Pros Items typically add to a site's value: Close to demand generators, urban centers, public parks or natural resources, areas of commerce or quiet reflection?
Proximity: Cons Close to power lines, cemeteries, train tracks, waste water treatment plants, landfills, manufacturing plants? Anything that might be considered a detraction of the site's value.
Transportation Access Availability of public transportation, access by car, truck, parking.	Cars and trucks have access to the back of the site. There is parking available in public garage on the south side of the site and there are two other parking structures within two blocks of the site. There are two central bus stops within a block of the site.	This site offers abundant public transportation and parking for employees, customers, tenants. There is also adequate truck/delivery access.
Utilities Availability Power, natural gas, telephone, broadband internet, water, sewer; verify access, capacity, and connection costs	Due to the site's location in the middle of a vibrant town and the presence of existing buildings, the developer assumes that all utilities are available.	Other than capacity verification, utilities do not appear to be a significant concern.
Contextual Response Any unique features such as historic architecture or natural beauty that should be recognized and respected by a new development?