eres2010_130_Henneberry_MODELLING_THE_RELATI(13)

The paper describes the development and application of physical-financialmodelling techniques to the analysis of relations between development design –covering the broad characteristics of a scheme, such as land use mix, developmentdensity and built form – and financial viability. It is divided into two parts

Examples of the use of the modelling system for site level analysis and for generic modelling are presented in the following sections of the paper.

The Wicker Riverside, Sheffield, UK

To illustrate the application of physical-financial modelling to the analysis of design quality and development viability, the case of The Wicker Riverside in Sheffield is considered. The area lies immediately to the north of the River Don which here defines the northern edge of the city centre. It was badly affected by the floods of June 2007. Two alternative approaches to redevelopment have been designed as part of a research project4. ‘Streets’ is a relatively conservative development that proposes building alignments and massing that replicate the existing street pattern and maximise the ameliorative effect of the River Don on the scheme’s microclimate (see Figure 5, which may be compared with its more detailed representation in Simmetry3d in Figure 3). The financial structure of ‘Streets’ is presented in Figure 7. The height of the column is the gross development value. From this are subtracted the various development costs: construction costs, professional fees, finance costs and land costs. Where, as here, total costs exceed development value, the column extends below the X-axis (which crosses the Y-axis at 0) and a negative developer’s profit results5. Given the current economic climate, it is not surprising that the scheme is not viable.

Park’ is a more radical scheme that differs substantially from ‘Streets’ and for which a separate representation was prepared (see Figure 6). A significant area of open space is incorporated into the scheme to mitigate the impact of flooding. This involves the demolition of an additional block of existing properties (at the upper-middle-right of the site; see Figures 5 and 6) as well as a large reduction in site coverage (see, for example, the area covered by the lower-right-hand block in Figure 5). Consequently, more new floor space is built at much higher densities on some of the developed parts of the site. The financial structure of ‘Park’ differs markedly from that of ‘Streets’ for these reasons (see Figure 7) and the former is much less viable than the latter.

Once the representation of a scheme has been produced, it is relatively easy to assess the financial implications of design changes. Alterations in building heights, floor-plates and uses undertaken in SketchUp are immediately read off into the spreadsheet to produce a new appraisal. For example, changing the use of one of the tower blocks in ‘Park’ from offices to apartments increases viability (in the sense that it reduces the loss, see Figure 7).

4 URSULA, funded by EPSRC (see Acknowledgement for details). 5 Obviously, if development costs are less than development value, then a positive developer’s profit would result and that part of the column would sit immediately above the X-axis.