DEVELOPMENT GUIDE
How to Build a Development Budget
A development budget captures every cost required to acquire, design, finance, build, lease and exit a project.
In this guideWhat the analysis measuresCalculation frameworkUnderwriting reviewHow to use the result
What the analysis measures
Separate land, acquisition costs, hard costs, enabling works, professional fees, contingency, finance, marketing, leasing and disposal costs.
Calculation framework
Assign each cost a driver, amount, tax basis, eligibility and payment period. Avoid one broad allowance that cannot be audited or phased.
Underwriting review
Reconcile the detailed budget with sources and uses and cost-to-complete. Track committed, spent and forecast balances during execution.
How to use the result
Use the budget to drive monthly funding and sensitivity. Cost totals alone do not reveal peak equity or interest during construction.