Maximizing Returns on a Mixed-Use Real Estate Development
Best-use analysis and financing strategy that unlocked incremental yield on a flagship mixed-use development.
Context
A privately-held Riyadh developer held a prime mixed-use land parcel with retail, office, and residential entitlements. Initial concept design had been completed by a third-party consultant, but board confidence in the financial case was limited.
Challenge
Multiple programming permutations existed across retail, office, residential, and hospitality components — each with materially different yield profiles. The board required an independent, financially-rigorous best-use case, alongside a financing strategy aligned to projected cashflows.
Our Approach
- Independent market study covering catchment demand, competing supply pipeline, and absorption assumptions per asset class.
- Decision-grade financial model with full sensitivity matrix across programming, pricing, and financing leverage.
- Best-use recommendation calibrated to risk-adjusted IRR, debt-service coverage, and exit liquidity.
- Financing structure — combining construction debt, mezzanine, and strategic equity — sequenced against the development phasing plan.
Outcome
The board approved the recommended programming mix and financing structure. Projected IRR uplift versus the original concept was substantial, and the financing was committed within six months of board approval.
"The depth of the financial analysis gave our board the conviction needed to commit. PO became our trusted long-term real-estate advisor from this mandate onwards."
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