Optimization of Tourism Real Estate Development Project Based on Option Premium Model

Compared with that of traditional housing real estate, the development of tourism real estate is time-consuming, complex, and irreversible. It is hard to guide investment decision-making on tourism real estate with the conventional discount cash flow (DCF) method. This paper aims to demonstrate that the real option method can improve and optimize the investment decision-making on tourism real estate. Through case analysis, the real option model, i.e., the classic American real option model, and binary tree value distribution model were adopted to analyze the factors affecting the real option of tourism real estate, optimize the development sequence of tourism real estate project, and demonstrate the phased development value of tourism real state, thereby enhancing the development value of tourism real estate projects. The case analysis proves that tourism real estate investment is fully consistent with real option in the uncertain spatiotemporal attributes: uncertainty, irreversibility, and timeliness. Therefore, tourism real estate project carries obvious features of real option. The decision-making by the real option model is much more scientific and superior than that by the conventional DCF method. Since the application of real option theory has been emphasizing housing real estate over tourism real estate, the research results enrich the theory on real option-based investment decision-making for real estate and expand the application scope of real option.

Value Maximizing Decisions in the Real Estate Market: Real Options Valuation Approach

The real estate market of EU countries has undergone a severe global financial crisis 2008–2009, recovered successfully later, and now experiencing significant uncertainty due to the COVID-19 pandemic event. Significant volatility of the real estate business is once again evident, just as it was following the global financial crisis. The paper aims to provide a case study of a real estate project by giving insight into the Latvian real estate project that had been experiencing similar economic uncertainty, to demonstrate hybrid real options valuation (ROV) method to adapt real estate investments to changing circumstances and to develop the decision-making solution to similar EU real estate problems during the pandemic. The paper provides the “step-by-step” ROV application’s methodology in real estate development projects. The presented methodology is a powerful managerial risk management tool for the executives of similar real estate development projects in the EU countries struggling to make investment decisions in the pandemic and post-pandemic period. Since any estimation includes assumptions, ROV results should be interpreted and perceived as approximations only. The future works can provide robust ROV analyses and interpretations regarding the demand for real estate, showing quantitatively how competition can impact strategic investment decisions.

Lean Construction in a Real Estate Project – A Case Study

More than 70% of construction projects are over budget and delivered beyond thebudgeted time. To overcome the same, the concept of lean integrated project deliverycame into existence. Lean culture focuses on customer by empowering employees. Itinvolves in converting waste into value by reducing waste, improving communication, andpromoting teamwork integration through a common set of tools and techniques. Aim oflean construction is to achieve the affordable cost with optimum utilization of man,material and machinery. Wastes in construction industry which do not add value are supplyin excess materials in inventory for raw material, work in progress, finished goods etc.Waiting for preceding activity, over processing and defects can be reduced through leanconstruction. This paper deals with lean construction techniques for identifying the wastein a construction project and eliminating the same. . In this project estimation of a buildingis done to find cost of the project with respect to specifications and compared thetraditional methods used and lean construction techniques to reduce the cost and improvethe quality in less time with lower cost to satisfy the customer.

APPLICATION OF LEAN TOOLS IN CONSTRUCTION OF REAL ESTATE PROJECT .

In the Indian economy, the real estate industry is of significant importance as it contributes between 6-8% to the Indian gross domestic product (GDP). Indian real estate building has fantastic growth prospects. Some Challenges such as Waste generation, Lack of skilled labour, Time overrun, Cost Overrun, Low Productivity etc. Average cost of waste as Proportion of cost of the project, excluding the cost of Performance varied from 5.38% to 14.70%.for Waste reduction and improve the productivity construction companies have started improvement through Lean Construction. It is essential to recognize waste and its related root causes at Indian construction sites in order to adopt lean principles, in which a major focus is on waste minimization. To evaluate the goals and functionalities of each LC instrument, a systematic literature review will be carried out. The functionality of lean software must be consistent with the accompanying procedures in order to effectively implement LC. The work presented would assist construction project management in making informed decisions on construction sites to schedule, handle, and monitor work activities related to equipment.