@MISC{Clower_abreak, author = {Chad M. Clower}, title = {A Break Even Analysis and Potential Profitability of a Proposed Residential Development within the}, year = {} }
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Abstract
A break-even analysis was conducted on a proposed residential subdivision development for a 79-acre farmstead on the southern fringe of La Crosse, Wisconsin USA. Potential profitability of the development was ascertained by this project. Both the current market for residential building sites and past sales of lots within existing subdivisions within the city were analyzed to help determine pricing for lots within this new proposed subdivision. Past and present real estate data were gathered from Multiple Listing Service data and La Crosse area periodicals. Map data was acquired from the La Crosse city planner’s office and a private engineering firm. Investment costs or outflows were land acquisition costs, development costs, marketing costs, and various indirect costs. These costs were provided by La Crosse area contractors and real estate companies. Project revenue was attained strictly through the sale of individual building sites. An analysis of the projected cash flow over an eight year project timeframe was conducted to provide the investor with the needed management information for decision-making.