Development Feasibility

A market feasibility study is not the same thing as an appraisal. An appraisal is an estimate of the value of a property as of a certain date, while a market feasibility study measures expected market response. An appraisal answers the question of “What is the property worth”, whereas a market feasibility study answers the question “If I proceed with my development, will the market buy it/rent it and how long will it take to rent up/sell the project to completion”.

A market feasibility study determines the depth and condition of a particular real estate market and its ability to support a particular development and the investment goals of the developer.

The first step is defining the extent of the market area, because not all market areas are alike. Elements of defining a market area include: geography, demographic analysis, mobility patterns, and area perceptions, to name a few.

Once the condition of the market is determined, then how the market will respond to the proposed project is made. This is accomplished by combining market data with a field study of the market. The key result of any market feasibility study is the absorption rate. The absorption rate is the measure of how many units of whatever is being sold or rented on a monthly or annual basis that is believed that the project will be able to achieve after completion. To determine the absorption rate by the market many factors are considered. After analysis of all the factors the absorption rate is selected for the property and incorporated into the analysis.

We believe that a market feasibility study is one of the most important steps in the development process. A market feasibility study not only predicts the absorption rate, but it can also present methods of fine-tuning the product to achieve greater success in the market.

NMREC has vast experience in providing reliable and credible market feasibility analysis’s for all development property types ranging from residential subdivision feasibility to franchise hotel feasibility throughout the State of Michigan. We are well recognize throughout the private and commercials sectors for our ability to provide sound and timely market feasibility analysis’s.


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