The residential development feasibility metrics that matter

The six core metrics

1. GRV — gross realisation value, the total revenue from selling every dwelling.
2. TDC — total development cost, every dollar spent to deliver the project.
3. Profit on cost — (Net realisation − TDC) / TDC. The headline ratio, target 18–22%.
4. Development margin — (Net realisation − TDC) / Net realisation. The pricing-power ratio, target 15–20%.
5. Equity IRR — annualised time-weighted return on equity, target 18–22%+.
6. Peak debt + peak equity — the largest balances each carries through the project, read off the monthly cashflow.

Why all six matter

Profit on cost can clear a hurdle while margin doesn't. IRR can be high while profit on cost is low. Peak debt can sit comfortably while peak equity exceeds the developer's appetite. Reading any one in isolation hides the trade-off the project actually faces.