The Importance of a Feasibility Study
Have you ever found yourself in the middle of a construction project that is completely off schedule and over budget? For institutional organizations like schools and hospitals, this can mean that capital campaign dollars that took months of hard work and generous donors is simply not enough. We have seen institutions having to take out loans to cover the extra project costs, or worse, having to reach back out to donors. This scenario is less than ideal, not only for board members, but for all involved in the capital campaign, the construction project, and those responsible for marketing the institution.
You might be (quietly) saying to yourself, this project was never really feasible given the current conditions- budget, schedule, site conditions, board approval, etc. Despite recommendations from professionals and pressure to move forward, the project plan was not entirely achievable. When this is the case, budget and schedule can get out of control very quickly.
Objectivity is the only answer to ensure a project is viable at the outset. That’s where the feasibility study comes in. Before any work begins, you should have your team conduct a thorough and extensive feasibility study in order to understand the viability of the project as a whole, and each aspect of the project.
What is a Feasibility Study?
A feasibility study is an analysis of how successfully a project can be completed, accounting for all factors that affect it: economic, technological, legal and scheduling factors. Project managers use feasibility studies to determine potential positive and negative outcomes before investing considerable time and capital into it.
The goal of a feasibility study is to place emphasis on potential problems that could occur if the project is pursued. The study will determine if, after all significant factors are considered, the project should be pursued; and if so, how the project should be pursued. The feasibility study allows a business or institution to address where and how it will operate, potential risks and the necessary funding to complete the project.
What will a feasibility study tell me?
A feasibility study will cover all potential threats to your project. It will focus on any specific project concerns, but in general, the feasibility study will:
- Determine if an environmental impact assessment (EIA) is required
- Assist in the development of project documentation: business case, execution plan, strategic brief
- Determine the necessary planning permissions needed
- Determine other legal/statutory approvals needed
- Analyze the budget relative to the client requirements
- Assess the potential to re-use any existing facilities
- Assess any and all site information provided by the client
- Include site appraisals, including geotechnical studies, assessment of any site contamination, availability of services, uses of adjoining land, easements and restrictive covenants, environmental impacts, etc.
- Assess operational and maintenance issues
- Appraise servicing strategies
- Address programming considerations
- Address procurement options
- Overall, establish whether the project is viable
- Help identify feasible options
The conclusion of the feasibility study will provide an in-depth outline of various scenarios examined, and the implications, strengths and weaknesses of each. While the decision whether to proceed may still be a difficult one, given the many, many factors explored in the study, the accumulation of information will empower all decision makers to be able to make an informed, educated go/no-go decision without second guessing. Source.
The aforementioned issues and consideration are relevant to real estate management and construction management projects of all sizes and in all regions.
APR Associates Limited has years of industry experience in the provision of:
- Location Analysis and Site Selection
- Trade Area Delineation, Geocoding, and Custom Mapping
- Real Estate Feasibility and Strategies
- Downtown and Community Market Strategies
- Highest and Best Use Studies
- Regional Economic Assessments and Strategies
- Demographic and Economic Assessments
- Market Snapshot Reports
We work with governments, real estate owners, property developers and various businesses from countries such as Trinidad and Tobago, Barbados and Jamaica, to the United States, Canada and the United Kingdom; studying and assessing commercial, residential, and mixed-use projects to determine their viability in a given market. We employ rigorous supply and demand analysis, we will identify the optimal volume, sizes, formats, and price points for any project.
Contact us now to discuss your real estate management or construction projects in detail today.