Level 2 - Project / Development Briefs

Question 1

How would you take the project brief?

Answer 1

There are three stages in developing and defining the client’s brief:

1. Statement of Need
2. Strategic Brief
3. Project Brief

Question 2

What are KPIs?

Answer 2

Key performance indicators are metrics used to evaluate factors that are crucial to the success of a project.

They can be used to:
• Monitor costs.
• Track progress.
• Assess client satisfaction.
• Identify strengths & weaknesses.
• Compare performance across and between projects.
• Assess specific areas of a project such as sustainability, safety, waste management etc.

Question 3

How would you develop the success measurement criteria and benefits of a project to a client?

Answer 3

Through the briefing process.

Question 4

What is a Residual Valuation?

Answer 4

• A financial appraisal of a development to calculate the residual site value.
• Deducting all development costs, including an allowance for the developer’s profit/return, from the scheme’s total capital value.

Question 5

What is a Development Appraisal?

Answer 5

• This is a method of assessing the profitability of a project.
• The residual development profit/return (deducting all development costs, including the site value/cost, from the scheme’s total capital value.
• It will take into account the Gross Development Value (which is the sale value of the finished building and site) which includes the following:

Costs
•	Land acquisition
•	Construction costs
•	Professional fees
•	Planning
•	Finance
•	Marketing agency fees for selling or renting

Outputs
• Development Profit
• Profit on Investment cost (Internal Rate of Return)
• Yield on cost

Question 6

What is sensitivity analysis?

Answer 6

Changing variables such as yield, rent and inflation to ascertain whether the project will still be profitable in different market conditions.

Question 7

What is the difference between a development appraisal and a feasibility report?

Answer 7

Development appraisal is focused on costs and profitability.

Feasibility report - will look at the detail of the design proposal, it’s likelihood to get through planning, the viability of the programme and suitability of budget and contingencies in relation of the perceived risks of the project.