Decision support for real estate development cost estimating

This research examines the theoretical underpinnings and associated advancements related to the built environment and decision support systems (DSS). Specifically for the built environment this includes the disciplines of real estate development, construction science and project management, finance, statistics and economics; for decision support systems this includes management science and decision analysis, and computer science. The purpose of this research was to design, develop and evaluate a prototype development cost estimating decision support system for use in the pre-development planning stage of real estate development. Particular emphasis was placed on synthesis of each discipline's models and/or advancements which support design and development of a decision support system; derivation of real estate development cost; and evaluation of risk. The results of the design and development phases of this research are embodied in the Real Estate Development Decision Support (REDDS) system as documented in this dissertation. Following design and development of the system, it was tested on a group of real estate development and construction management students at Texas A&M University. It was hypothesized that such an interdisciplinary methodology, which utilizes a decision support system framework, would facilitate generation of consistent and timely analysis of real estate development cost and associated risk and elevate the confidence of the user in the decision making process. Test results indicate that the REDDS systems does significantly reduce conceptual cost estimating preparation time. Further, it was determined that the REDDS system does not significantly change the confidence of the user in the decision making process. Finally, this study shows that use of the REDDS system provides a consistent and sophisticated framework for evaluating development cost and risk, which leads to less variation and more accurate estimates.