1. Building Disaster Resilient Communities Session 15: Private Sector Project Planning and Review Steven P. French, Ph.D., AICP Georgia Institute of Technology

2. Flowood County 2000 Population 69,127 Annual Growth Rate 1990-2000 4.6% Annual Employment Growth 1000 jobs Housing Absorption 1999-20001400 units/year Overall Market Analysis

3. 200 Houses 1999 130 Houses 2000 Proposed Project Site Specific Market Analysis All Homes Have Been Sold Apartment Vacancy Rate is 2 percent 125 Apartments 2001

4. Developability Analysis Site is flat and easy to develop. 40% of the site is in the 100-year flood plain The average depth of flooding in the 100-year flood is 5.7 feet There are no other hazards on this site

5. Revenue 40 lots x $50,000/lot2,000,000 Costs Land Acquisition 900,000 Site Planning/Engineering 80,000 Construction 500,000 Marketing and Sales 120,000 Subtotal1,600,000 Financing - Average Balance of $800,000 for 2 years at 10% interest 160,000 Total Costs1,760,000 Profit (Revenue – Total Costs) 240,000 Basic Financial Analysis

6. Net Present Value NPV =  Values i (1+r) i i =1 n Where NPV = Net Present Value Values = Future payment in each year i r = the discount rate N = the number of years

7. Apartment Rent $1000/mo. x 12 mos./yr. x 10 years = $120,000 Present Value = $74,332.49 Note how the discount factor increases the further we go into the future. Present Value Example