Feasibility Studies
Before any of the components of a PRC are considered or any project planning commences, a study needs to be done to determine if the anticipated development is even feasible.
The answer could be a resounding “yes,” “no,” or “ marginal.”
A PKI feasibility study, typically 150 – 200 pages, is comprehensive and takes a hard look at all the variables that impact the success or failure of a PRC. After a careful analysis, a recommendation is made that will be information a developer and his investors or lenders need to make an educated decision on whether or not to proceed. A few of these variables are:
- Desirability of location
- Seasonality of location
- Typical per season visitation patterns
- Value of whole ownership second homes in the area
- Demand for second homes in area
- Demographics of buyers for the area
- Psychographics of buyers for the area
- Anticipated sales absorption rate
- Typically desired services and amenities
- Availability and cost of labor pool
- Feeder markets for the area
- Cost and methods of reaching the feeder markets
- Competition
- Barriers to entry
- Industry trends
- Market trends
- Construction or renovation period
- Availability of financing
- The guiding motivation behind the study will be to provide information the developer needs to know even if the information may not be what the developer wants to hear. It can also be integral to the developer's obtaining investor or lender support.
The guiding motivation behind the study will be to provide information that the developer needs to know - even if the information may not be what the developer wants to hear.
