Property Development Report: Kier Company Analysis

This report delves into the multifaceted world of property development, commencing with an introduction to the concept and its significance, particularly in residential contexts. The main body of the report explores crucial aspects such as site selection methodologies and reasoning, emphasizing the importance of identifying key factors. It details the acquisition and development processes, breaking down each stage from initiation to maintenance. The residual method of valuation is then explained, highlighting its application in determining property values and its advantages and disadvantages. The report also outlines the crucial aspects to consider before selecting land, encompassing financial, physical, social, and legal factors. Finally, it concludes with a self-reflection section that provides a personal account of the experience and lessons learned during a property development project, including strengths, weaknesses, and areas for improvement. The report offers a comprehensive overview of the property development process, from initial planning to final valuation, providing valuable insights into the key considerations and methodologies involved.

Property, people and Economy

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Site selection and reasoning.........................................................................................................3
Acquisition and development process.........................................................................................3
Residual method of valuation......................................................................................................5
Aspects to be consider before selecting land...............................................................................6
Self – reflection............................................................................................................................6
CONCLUSION................................................................................................................................8
REFRENCES...................................................................................................................................9

INTRODUCTION
Property development refer to as the process of developing buildings or make residential
house so that people can live. It is important to build house but there are some factors which
should be kept in mind such as, location, price of land, facilities, determine whether it is
beneficial or not (Berawi and et.al., 2020). Kier is a public limited company, construction
industry and property management founded in the year 1928. Key people of company are,
Matthew Lester, Chairman and Andrew Davies, CEO. It is one of the best construction company
and provide good services to customers. In this report, it will discuss site selection and reasoning
of property is described. Acquisition and development process and residual method of valuation
is explained. Some points to be consider are, financial, physical, social and legal while acquiring
land.
MAIN BODY
Site selection and reasoning
Site selection refers to the process of choosing location for building residential house. It is
important to identify all the factors before taking any decision and take time to determine all
elements ((Hei and Dastane, 2017). There are some site selection methodology and criteria by
which bets option can be selected. Selection of site includes, determining criteria of selection,
develop list of candidates sites and supporting information, apply site selection filter, site visit,
select candidate site via team discussion, take permission, and last implement the logistics. This
is the selection process of site which can be used so that best option can be chosen. There are
criteria like, how much acre land is to be acquire. List of candidates should be prepared and
gather information about every candidate. After that the next step is to apply selection filter by
which some candidates are selected. Then site visit with candidate is done to see that whether
land is good or not. After site visiting, permission should be taken and complete all formalities.
There are some legal rules and regulations which should be followed after selection of site.
Acquisition and development process
Acquisition process
 Initiation – This is the first stage of acquisition process in which idea is generated. Before
taking land, clients make plans and decide which type of land they want to acquire, prices

should be decided like, for an acre land price is £12,000 and £15,000 in England and
other facilities. This is the beginning of acquisition process and it should be in systematic
way so that other stages will take place properly.
 Planning- Second step of acquisition process is to make plans, after deciding location
such as, in England, UK and price clients should make plans or strategies so that they can
get better opportunities. This is one of the important steps because without planning it is
not possible to acquire land.
 Procurement – It means to find goods and services, acquire correct land, best option
should be selected, internal and external source which can be used in acquisition process
must be identified. This helps customers in choosing appropriate option (Hussain and
et.al., 2019).
 Development – This means to make changes or improvements in acquisition process,
development should be done, new and advanced idea. Development means to make
changes in plans so that there will be no issue in future growth.
 Implementation – This step refers to implementing plans or strategies which are being
made to satisfy needs of clients. Acquisition process includes different steps and all
should be done in systematic way so that goals can be accomplished.
 Maintenance and operation – Last stage of acquisition process is maintenance and
operation, means to take care of land or building properly (Verhage, 2017). When
acquiring property proper maintenance should be done, repair and maintenance is
required after sometime.
Development process
 Land banking- It means to acquire or hold land which is undeveloped and want to earn
more profit. In this a person purchases land at lower rate and wait for future. After
selection of site land owner sell land to developers, investors and other parties who are
interested at higher rates to earn profit (Low and et.al., 2020).
 Land packaging – Land packaging is another step of development process which means
to make plans or strategies for future growth and make some changes so that value of
land can be increased. After selectin a site, construction process should be started and
build residential house.

 Development of land- It means to alter landscape in different form such as, it can be
used for residential purpose, agriculture or nay other. This usually involves construction
of infrastructure and this will help in increasing value of land. If more facilities are
provided then it is beneficial. A residential building should be made and sell it to people
who want house to stay.
 Building development – This stage of development process means to make changes or
improvements at the time of making plans for building residential property. If more
changes are made then it will help in satisfying needs of customers and better services
can be provided to them (Saidu and Yeom, 2020). When location is final then start with
further process such as, building development.
 Renovation- It means to generate some new ideas and skills for building renovators.
Renovation is necessary so that all mistakes can be rectified and there will be no issue in
future. All things will be done in a perfect manner and good services should be provided
to customers.
Residual method of valuation
Residual method of valuation can be referring to as income model or residual income
method which is useful in calculating the value of company’s stock. This method helps in
identifying residential land value by subtracting purchase and development cost from selling
cost. This method is used by companies at the time of building residential house or selling land
for residential purpose (Morena and et.al., 2021). It is important to calculate final price so that it
can be determined that how much profit is being earned and in which area improvement is
required. This model does not focus on terminal value and it is beneficial for company. Residual
method of valuation is generally used in valuing land or building with development.
This method is used by companies to assess value of property so that profit can be
determined. There are some advantages of residual method of valuation such as, this method is
useful for other models, it focusses on value drivers like to earn profit from investment which is
made and strategic thinking. Proper plans must be made so that there will be no issue in future.
This method helps in incorporating financial statement such as balance sheet is maintained at the
book value and future estimation can be done. Managers of company can make future plans so
that there will be no problem. It will help in managing all the activities properly and accounts

will be maintained properly (Rachmawati and et.al., 2019). This model uses accrual accounting
like, investment is being treated as an asset, recognize value added.
Residual method of valuation has variety of accounting principles and this is beneficial for
an organisation because correct decisions can be taken and there will be no problem in future.
Disadvantages of this method are, may be wrong calculation is done and it will affect overall
performance of company will be affected, there is complexity in accounting principles. Managers
should take decision after analysing all the positive and negative points so that firm can grow and
it is useful for all.
Aspects to be consider before selecting land
There are some aspects which are to be considered before selecting land are, financial,
physical, social and legal aspects. These are factors which client kept in mind at the time of
selecting land. There are many options available in market but client has to select according to
their need and it will be beneficial for them in future. Financial factor is one of the important
sectors because prices should be according to customer (Reed, 2021). Value of land should not
be high; client may afford it and all the facilities must be available. Building or purchasing
residential land requires huge amount of investment and money is required in renovation and
other activities. So, client should consider this factor and take decision accordingly. Physical
factor includes location, shape and size of land, environment in the surrounding. This should be
considered by customers before taking any decision because if location is not good then it is not
possible to stay.
Another factor is social which involves, culture of nation, their language and how other
people are behaving. Choice of customers vary and it is difficult to provide them services, but
employees of Kier company are giving their best and they listen to what clients want. They are
asking customers about their needs and find residential building accordingly. It is the
responsibility of managers to provide best services to clients and satisfy their needs. Another
factor is legal which includes, rules and regulations made by government (Ogunbayo and et.al.,
2019). In all countries, rules and regulations, laws are made by government so that there will be
no problem in future. When purchasing land or building, paperwork should be completed and all
legal formalities must be done. This will help in maintaining equality and there will be no issue
among people.

Self – reflection
Property development and acquiring is not easy, there are many factors which should be
considered so that there will be no problem in future. It is important to identify that where we are
planning to take land is safe or not, what is the price of land. There must be all the facilities and
in England there are many opportunities available. Nowadays, all people want to buy land or
build house so that they can stay safely. Competition is increasing among property dealers and
prices of land are also increasing day by day. In England, there are many opportunities for
residential development. A client had approached me for pursuing property development and
asked me to find a residential development opportunity in England.
The experience was good and I give my best to satisfy needs of client. I find residential
development opportunity in England and show it to the client. When working I find some
strengths and weakness such as, I am having good communication skills and ability to influence
people. I was able to convince them to buy land and I was able to understand choice of
customers. This is my strength which will be beneficial in getting future growth opportunities. I
should work harder so that I can perform better and it will help me in earning more profit and I
can satisfy need of customers. My weakness was that I was not having much knowledge about
property development because I had started this work from few months. I should listen to client
properly and did not waste my time in searching for land which is of no use. They were satisfied
by my work and appreciate me for completing my work on time.
I had selected best option for them according to their choice and try to satisfy them by
providing best options. They were quite impressed by my work and tell me that they will suggest
their friends and relatives also. If I will get chance to again do this task, I will do more research
and try to give my best. I will improve my performance and try to satisfy need of client. By
doing this task I have learn many things like, how to decide or buy land. Some aspects which
should be kept in mind before taking any decision and all the issues must be solved so that there
will be no problem in future. Importance of determining factors such as, price, location. Social
and legal points. Acquisition and development process such as, land banking, land packaging,
development of land, building development, building operation, renovation and site
redevelopment. I had learnt all these things and this will help me in getting good opportunities in
future.

CONCLUSION
From the above discussion it can be concluded that, while selecting land there are many
factors which should be consider like, location, price, social, legal and physical aspects.
Acquisition process which includes, initiation, planning, procurement, development,
implementation and maintenance & operation has been discussed. Development process such as,
land banking, packaging, development of land, building development and renovation which help
in increasing value of land. Further, residual method of valuation has been discussed which helps
in calculating profit earned.

REFRENCES
Books and Journals
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consumers in Malaysia. Singaporean Journal of Business, Economics and Management
Studies (SJBEM). 5(9). pp.19-35.
Hussain, T., and et.al., 2019. The effect of sustainable urban planning and slum disamenity on
the value of neighboring residential property: Application of the hedonic pricing model
in rent price appraisal. Sustainability. 11(4). p.1144.
Low, S., and et.al., 2020. Smart digital marketing capabilities for sustainable property
development: A case of Malaysia. Sustainability. 12(13). p.5402.
Morena, M., and et.al., 2021. Residential Property Behavior Forecasting in the Metropolitan City
of Milan: Socio-Economic Characteristics as Drivers of Residential Market Value
Trends. Sustainability. 13(7). p.3612.
Ogunbayo, O. T., and et.al., 2019. The significance of real estate development process analysis
to residential property investment appraisal in Abuja, Nigeria. International Journal of
Construction Management. 19(3). pp.270-279.
Rachmawati, D., and et.al., 2019. Factors influencing customers’ purchase decision of residential
property in Selangor, Malaysia. Management Science Letters. 9(9). pp.1341-1348.
Reed, R., 2021. Property development. Routledge.
Saidu, A. I. and Yeom, C., 2020. Success criteria evaluation for a sustainable and affordable
housing model: a case for improving household welfare in Nigeria
Cities. Sustainability. 12(2). p.656.
Verhage, R., 2017. Local policy for housing development: European experiences. Routledge.