Finance
Feasibility no longer works
This can change development yield, consent pathway, purchase price, funding, construction cost, settlement timing, or legal risk. Treat it as a decision point, not background noise.
What it looks like
- Margin drops below target after new cost, revenue, finance, consent, or programme information.
- The model only works with optimistic assumptions.
Likely causes
- Cost increases
- GRV reduction
- interest increase
- delay
- yield reduction
- unexpected consent/infrastructure requirements
Immediate action
- 1Pause the affected decision or commitment until the issue is understood.
- 2Record the issue in the risk register with date, source, owner, and next action.
- 3Send the relevant documents to Developer, QS, Valuer and ask for written advice.
- 4Update feasibility, programme, budget, and decision register if cost, time, yield, consent, title, finance, or sales assumptions may change.
Step-by-step solution
- 1Define the problem in one sentence and identify which project decision it affects.
- 2Check the controlling documents: Feasibility model, QS report, Valuation, Programme, and related project records.
- 3Ask the responsible professional to confirm whether the issue is real, minor, manageable, or project-changing.
- 4List the available options: redesign, renegotiate, seek consent, add cost allowance, change programme, change sales strategy, or abandon.
- 5Price and programme each option using the current feasibility model.
- 6Make a written decision with source references and approval from the developer or project owner.
- 7Notify affected parties such as lender, lawyer, consultants, builder, agent, buyer, or council when required.
What not to do
- Do not rely on a seller, agent, or builder comment when a planner, lawyer, accountant, engineer, surveyor, valuer, lender, or council needs to confirm it.
- Do not hide the issue from the feasibility just because the project looked profitable yesterday.
- Do not waive due diligence, lodge consent, sign a contract, approve a variation, or promise settlement while the issue is unresolved.
- Do not give legal, tax, finance, planning, engineering, or council advice to others unless a qualified professional has confirmed it.
Verification
Source / where to check
Use current official information and the controlled documents for the actual project.
Planner, surveyor, architect, engineer, quantity surveyor, lawyer, accountant, lender, valuer, real estate agent, and other project specialists must confirm site-specific decisions.
Use IRD property guidance for tax topics such as income tax, GST, rental income, property sales, and entity records. Confirm project-specific treatment with an accountant or tax adviser.
Project-specific consented documents and professional advice override generic guidance.
Cost impact
Critical if the project cannot meet required margin or funding conditions.
Programme impact
Medium to high because redesign, renegotiation, or abandonment may be needed.
Risk level
Critical
Compliance and contract impact
Check whether the issue changes the resource consent pathway or conditions, building consent documents, consultant scope, sale and purchase conditions, finance terms, construction contract scope, notice requirements, variation process, or settlement obligations.
Example email / decision wording
Subject: Feasibility no longer works — advice and decision required. We identified this issue during detailed feasibility. The current evidence is listed in the attached record. Please confirm the controlling requirement, available options, cost/programme implications, further information needed, and whether any consent, contract, funding, or settlement action must pause. No assumption has been approved pending written advice.