<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Decisions – where and what type of building to build – are very important, determine the quality of life of residents, profitability and returns of companies. Considering of long-term asset acquisition decisions, purchasers or investors seek for proper and worth to invest land plot for construction. In real estate valuation literature usually the list of 7 or 12 factors influencing value and price of land plot is presented and broadly discussed. Certain factors raise property prices and others bring them down. Despite its importance, the influence of geological conditions on the appraised land plot are seldom investigated. Authors discuss how strongly land plot geological conditions can affect costs of prospect construction, thus decrease net present value of real estate investment project and profitability of property. In this paper the implication of negligence or underestimation of soil conditions valuation is highlighted and illustrated by case studies which show how such inobservance has resulted in a huge rise of unexpected costs of construction and loss of time.</p>
</abstract>

Decisions – where and what type of building to build – are very important, determine the quality of life of residents, profitability and returns of companies. Considering of long-term asset acquisition decisions, purchasers or investors seek for proper and worth to invest land plot for construction. In real estate valuation literature usually the list of 7 or 12 factors influencing value and price of land plot is presented and broadly discussed. Certain factors raise property prices and others bring them down. Despite its importance, the influence of geological conditions on the appraised land plot are seldom investigated. Authors discuss how strongly land plot geological conditions can affect costs of prospect construction, thus decrease net present value of real estate investment project and profitability of property. In this paper the implication of negligence or underestimation of soil conditions valuation is highlighted and illustrated by case studies which show how such inobservance has resulted in a huge rise of unexpected costs of construction and loss of time.

LACK OF ATTENTION TO GEOLOGICAL CONDITIONS INVESTING IN LAND PLOT FOR CONSTRUCTION

Architecture, Civil Engineering, Environment

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Decisions – where and what type of building to build – are very important, determine the quality of life of residents, profitability and returns of companies....

LACK OF ATTENTION TO GEOLOGICAL CONDITIONS INVESTING IN LAND PLOT FOR CONSTRUCTION

Article Category: research-article

Published Online: Jan 07, 2020

Page range: 87 - 95

Received: Mar 19, 2019

Accepted: Sep 25, 2019

DOI: https://doi.org/10.21307/acee-2019-054

Keywords
Construction costs, Geological and soil conditions, Land plot valuation factors, Real estate development, Geological investigations

© 2019 Vita URBANAVICIENE et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

LACK OF ATTENTION TO GEOLOGICAL CONDITIONS INVESTING IN LAND PLOT FOR CONSTRUCTION

Article Category: research-article

Published Online: Jan 07, 2020

Page range: 87 - 95

Received: Mar 19, 2019

Accepted: Sep 25, 2019

DOI: https://doi.org/10.21307/acee-2019-054

KeywordsConstruction costs, Geological and soil conditions, Land plot valuation factors, Real estate development, Geological investigations

© 2019 Vita URBANAVICIENE et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords
Construction costs, Geological and soil conditions, Land plot valuation factors, Real estate development, Geological investigations