Gross Development Value

A calculation of what a development property should be worth on the open market.

A development property’s gross Gross Development Value (GDV) is its expected value, all circumstances being ‘normal’, when it is sold to a willing purchaser on the open market. This value will be determined on the basis of current and recent similar transactions. The GDV can then be used to calculate the mortgage required for the property.

How important is it to know a property’s GDV?

A property’s GDV is a vital part of any financial appraisal of a property development project, underpinning all other considerations such as site purchase costs, building costs and legal costs, as well as funding and profit requirements.

Practical Application Example

“ There are various ways to calculate GDV, including by looking at values placed on properties in current and recent similar transactions within the development area. Both capital and rental value may be accounted for in determining a GDV. ”