Residual Land Value methodology for viability assessment

This methodology, also called the Residual Land Value (RLV) method, is the most appropriate to use for valuing land with development potential when undertaking viability assessment. Essentially, it is an equation where a combination of inputs can be used to calculate the missing element. In the case of a strategic plan-wide viability assessment the assumptions are all standardised, meaning that where the total cost of delivery, including a reasonable return for a developer, equals or is below the total development value, developments are considered viable. Where an element of 'headroom' exists, this would allow a developer to compete for land above the benchmark land value.