Tod went back and crunched numbers on each of the projects.
He only had $29million left. So theoretically, the mixed use property project would yield the best payoff. For $21million, we would be able to make at least $54million.
But would it be better if he modeled a medium density project instead? Since the assumed 70 units can be lowered to maybe about 35 to 50 units. So, focusing just on commercial/mixed use properties, he calculated how much he could generate.
Ah. If he spent $28million, he would be able to get $75million back, increasing his entire cash position by $47million. That’s amazing, but it assumes that he actually does sell all 50 units for $1.5million.
Should he do some market survey?
Were these 3 cities ready for a 50 unit development project? Surely with their population for 50-70 thousand, they can easily eat up $75million worth of properties! He just needed 50 wealthy citizens! The math checks out!
With $75million, he could reinvest it into more properties, and then he could work on new lines!
Wait.
Is he a property developer, or a rail transit developer? Was he going astray?
He thought about it for a moment and remembered that property values and high density properties must work together with public transport. If the property funds more public transport, that’s a good thing overall.
Steps that he needed to take to get where he wanted to be!