The opportunities of additional and infill development
Key factors affecting the potential and profitability of additional development projects:
- Whether it’s technically possible to raise the building by one or more levels, or whether there is room for an extension on the plot, which can be built on a new plot parcelled out from the existing plot.
- Municipal constraints for the project, such as land use planning, the amount of land use tax, parking policy, municipal development strategy, urban landscape and environmental values.
- A housing company has the possibility to deduct renovation costs and depreciations in its financial statements to offset the proceeds from the sale of the land, in order to minimise corporation taxes.
- There is market demand for new housing or office space in the area and on the plot, which means that the additional development project is commercially viable.