Role of valuations in major development projects

The BC Buildings Corporation was created in 1977 as the successor to the Ministry of Public Works in the province of British Columbia. Over 22 million square feet of space, owned and leased, is managed by the Corporation. Budgets for all space built by the Corporation are developed through market costing, valuation and economic analysis. Analyses two major development projects recently constructed and/or planned by the Corporation, namely: a residential land subdivision developed on a former correctional prison site, and a major office building. Offers a critique of the advantages and disadvantages of the residual approach to valuation in the context of the projects discussed. Outlines and comments on findings of a survey undertaken by the Corporation on the development and investment industries’ approach to economic analysis and valuation. Summarizes changes made to the Corporation’s approach to major development project analysis as a result of recent experience and the survey, and discusses the future role of valuation and the valuer in major developments.