13.07.2020, 17:11

When Mixed-Use Facilities Make Sense

Modelling by a postgraduate researcher from the International School of Management (ISM) in Dortmund has identified factors that make mixed-use developments more attractive for developers than single-use projects in urban environments.

Vanessa Piller analysed planning applications in Munich to understand why, despite residential and commercial communities often coexisting side-by-side, mixed-use developments are not popular with local developers.

Professor Werner Pauen who heads the Master’s degree programme In Real Estate Management at ISM, explains: “Two approaches, target-costing and classic real estate development were modelled in order to examine the cost-benefit ratio in more detail.

“The work calculates the product profile and the resulting and acceptable construction costs of a mixed-use property at the early stage of project development, taking into account the preferences of the users, in order to ensure sustainable success over the entire life cycle of the property.

“In addition to contractual conditions, potential market rents and in particular, factors influencing the willingness of end-users to pay were included.”