Aggregated Parcel Value Uplift
A unified, assembled parcel often holds a significantly higher value than the sum of its individual lots
- Assembled land allows larger-scale development, increasing per square foot utility
- Higher zoning potential (FAR, height) becomes viable once site size thresholds are met
- Parcel unity reduces site inefficiencies like duplicate driveways or setbacks
- Developers may pay a premium based on the end-use value of the consolidated site
Lower Value of Fragmented Individual Lots
Individual lots are typically valued based on current use, not potential redevelopment
- Small lots often priced for residential or low-density commercial use
- Limited access, shape, or frontage constraints reduce redevelopment appeal
- Standalone parcels lack the scale to attract institutional investors or major tenants
- May include title issues, easements, or use restrictions not apparent in isolation
Price Per Square Foot Disparities
Per-unit land values can vary widely before and after assembly due to scale and entitlement gains
- Unified sites command higher $/sq ft due to efficiency in planning and infrastructure
- Land banking or speculative value may inflate individual lot prices during negotiation
- Valuation models shift from comps to income-based approaches after assembly
- Sellers may overestimate their lot’s value if aware of developer interest
Strategic Valuation Considerations for Developers
Understanding the difference between piecemeal and unified valuations is key to profitable acquisition
- Developers calculate residual land value based on projected buildout economics
- Assembled value accounts for reduced entitlement risk and enhanced financing options
- Bulk acquisition provides leverage in securing incentives or density bonuses
- Transparent valuation helps align expectations with landowners and financiers
