The aim of this guidance note is to guide the valuer in the approach to development property valuations.
A development property is defined in the International Valuation Standards (IVS) as:
‘interests where redevelopment is required to achieve the highest and best use, or where improvements are either being contemplated or are in progress at the valuation date’.
Development projects can vary from single or multiple residential projects to industrial estates, shopping centres, other retail developments, offices and mixed-use developments.
Development property valuations are often complex, have a potentially high variation and incorporate optionality. They can relate to specialised markets and therefore require a high level of expertise.
The principles set out in this guidance note apply to all valuations of development property and should be read in conjunction with RICS Valuation – Global Standards 2017 (Red Book Global Standards) – incorporating the International Valuation Standards (IVS), in particular IVS 410.
Where updates to the Red Book Global Standards take effect after the publication of this guidance note, these take precedence and valuers must ensure that they are fully aware of any changes.