What Is Mollard Property Group’s Highest & Best Use Analysis and When Do You Need One?
When assessing a property, the obvious use is not always the most viable one.
A site may currently be used for retail, residential, industrial or commercial purposes, but that does not necessarily mean its existing use represents its full development potential. Changes in planning controls, demographics, market demand, infrastructure, construction costs and investment conditions can all change what a site could support.
This is where Mollard Property Group’s Highest & Best Use (HBU) analysis can provide valuable insight.
Our Highest & Best Use analysis is a structured assessment used to determine the most viable and valuable use for a property, based on its physical characteristics, planning controls, market conditions and financial potential.
At Mollard Property Group, our analytics-led HBU approach evaluates a site across 207 potential use cases before modelling the strongest opportunities against planning, market demand and financial viability.
What does “Highest & Best Use” mean?
Highest & Best Use refers to the use of a property that is considered the most appropriate and commercially viable based on the site’s potential and constraints.
Importantly, “highest” does not simply mean the use that generates the most revenue.
A development might have a high theoretical end value but require excessive capital, face significant planning risk or have insufficient market demand. Another use may provide a stronger risk-adjusted outcome with a clearer pathway to approval and delivery.
A robust HBU analysis therefore considers multiple factors before recommending a preferred development pathway.
What does a Highest & Best Use analysis assess?
Every property is different, which is why an HBU assessment needs to look beyond a basic desktop review.
Depending on the site and project objectives, Mollard Property Group’s Highest & Best Use assessment considers:
1. Planning and zoning
Planning controls can determine what is permitted on a site and what may require further approval.
Our HBU analysis considers relevant zoning, overlays, heritage considerations, environmental constraints, infrastructure and other planning factors that could influence development potential.
2. Site characteristics
The physical characteristics of a property can significantly influence what can realistically be developed.
This may include site area and geometry, access, surrounding development, topography, existing improvements and other site-specific constraints.
3. Market demand
A use only has value if there is sufficient demand for it.
Market and demographic information can help identify where demand exists and whether a proposed use is supported by the surrounding catchment.
4. Alternative development uses
One of the most important parts of an HBU assessment is considering alternatives.
Instead of starting with the assumption that a site should become a particular type of development, the analysis can compare multiple potential uses.
Depending on the property, these may include childcare, residential, commercial, medical, build-to-rent, hospitality, education, mixed-use and other development opportunities.
5. Financial viability
A development concept needs to make commercial sense.
Financial modelling can test factors such as development costs, revenue, yield, capital requirements and potential returns to determine whether a proposed use is financially viable.
For property owners and developers, this can help distinguish between an attractive concept and a development opportunity that is actually commercially feasible.
6. Planning and execution pathway
The strongest use on paper may not necessarily be the strongest use in practice.
Our HBU assessment considers the likely pathway required to take a concept from analysis to development, including planning considerations, risk and execution requirements.
When do you need Mollard Property Group’s Highest & Best Use analysis?
Our HBU assessment can be particularly valuable before committing significant capital, making an acquisition decision or progressing with a development concept.
Before buying a property
One of the most valuable times to conduct our HBU analysis is before purchasing a site.
If you understand what a property could potentially support before negotiating or acquiring it, you can make a more informed assessment of the site’s value and development potential.
This can help identify opportunities that may not be obvious from the current use or initial marketing campaign.
For developers and investors assessing a potential acquisition, our HBU analysis can sit alongside broader property acquisition and feasibility work to help determine whether a site warrants further investigation.
When a site has been sitting unused or underperforming
If a property has remained vacant, underutilised or difficult to sell, it may be worth reconsidering the underlying use rather than simply waiting for market conditions to improve.
Our HBU assessment can identify alternative development pathways that may better align with current demand.
When planning conditions have changed
Planning controls, infrastructure investment and surrounding development can change the potential of a site.
A property that made sense for one use several years ago may have a different highest and best use today.
When you are considering a change of use
If you are considering converting or repositioning an existing property, our HBU analysis can help compare the proposed use with alternative options before you commit to design, planning or construction costs.
When you need to compare development options
Developers and investors may have several potential concepts for a site but need to determine which one makes the strongest commercial and planning case.
Rather than assessing each option in isolation, our HBU analysis provides a framework for comparing potential uses.
When you want to reduce development risk
The earlier major risks are identified, the easier they are to address.
Our HBU assessment can help identify planning constraints, weak market demand, financial limitations and alternative opportunities before significant capital is committed to a development pathway.
How does Mollard Property Group’s Highest & Best Use analysis work?
At Mollard Property Group, our HBU Engine follows a five-stage analytical process.
01. Ingest
Relevant site, planning, demographic and market information is collected and normalised.
02. Overlay
Planning controls, heritage, environmental, infrastructure and other relevant constraints are applied to the site.
03. Evaluate
The site is assessed against 207 alternative use cases to identify potential development opportunities.
04. Model
The strongest candidates are subjected to financial feasibility modelling to identify which options are commercially viable.
05. Recommend
The viable uses are ranked and presented with the relevant planning and execution pathway.
The result is not simply a list of ideas. It is a structured recommendation designed to help property owners, developers and investors make better-informed decisions about what a site could become.
Learn more about Mollard Property Group’s Highest & Best Use service.
Highest & Best Use vs property development feasibility
Our HBU analysis and property development feasibility study are related, but they answer different questions.
A development feasibility generally asks:
“Does this proposed development make financial sense?”
Our Highest & Best Use analysis asks:
“What should this property become in the first place?”
That distinction is important.
If you begin with the wrong development concept, even a detailed feasibility study may simply prove whether the wrong idea works financially.
Our HBU analysis can be used earlier in the decision-making process to identify and compare potential uses before committing to a specific development pathway.
For projects where the preferred use is already established, a more targeted Childcare Needs Assessment, Modelling & Financial Feasibility can help assess demand and financial viability before progressing further.
Why Highest & Best Use matters for property investors and developers
Property value is not always determined by what a site is currently being used for.
The value may lie in what the property could become.
For developers and investors, understanding development potential before acquisition can provide greater clarity around:
• What a site could potentially support
• Which uses have genuine market demand
• Which options are likely to be financially viable
• What planning constraints need to be considered
• Where development risk may sit
• Whether the proposed acquisition price makes sense
• Which development pathway may provide the strongest outcome
This is particularly relevant in a changing property market, where assumptions made several years ago may no longer reflect current conditions.
What can an HBU analysis reveal?
Sometimes the answer confirms the original development idea.
Sometimes it reveals a stronger alternative.
A site originally considered for childcare may have greater potential for residential development. An underutilised commercial property may be better suited to medical, education or mixed-use development. A residential site may support a different configuration or density than originally anticipated.
The purpose of our HBU analysis is not to force a particular outcome. It is to test the possibilities and determine which pathway is most defensible based on the available evidence.
This is where a structured property acquisition and site assessment process can be particularly valuable – identifying opportunities before significant resources are committed to a single development concept.
When should you undertake our HBU assessment?
The simple answer is: before you commit significant time or capital to a development direction.
For property owners, investors and developers, our HBU assessment can be particularly valuable at the acquisition, early feasibility or repositioning stage.
At Mollard Property Group, a full HBU Assessment uses our five-stage HBU Engine to evaluate potential uses, financial viability and the associated planning pathway.
Could your property have a better use?
The most valuable development opportunity is not always the most obvious one.
If you are considering acquiring a site, repositioning an existing asset or developing underutilised land, our Highest & Best Use analysis can provide a clearer view of what the property could support before you commit to a particular direction.
Mollard Property Group combines property development expertise with analytics-led HBU modelling to assess sites across 207 alternative uses.
Ready to understand what your site could support? Enquire about our HBU assessment.
