Ratios & metrics
Gross Development Value (GDV)
The projected aggregate sale or investment value of a development scheme on completion — the figure every development lender underwrites against.
Gross Development Value is the valuer’s view of what a finished development will be worth on day one of practical completion — before any sales costs, selling agent fees, or warranty premiums are stripped out.
It’s the denominator in LTGDV, the headline metric a senior development lender uses to size a loan.
GDV vs. Net Development Value
- GDV — gross sale price across all units, pre-costs.
- NDV (or Net Development Value) — GDV minus disposal costs (agency, legal, marketing, warranty, any incentives or fees).
Most senior lenders underwrite against GDV. Mezzanine lenders often model NDV for their own debt-service cover.
How valuers actually arrive at a GDV
Expect a chartered surveyor to produce a figure that your appraisal spreadsheet disagrees with. The valuer will:
- Pull 6–12 comparable transactions of built, sold, and registered units within a reasonable radius.
- Adjust per square foot for size, specification, floor level, aspect, parking and tenure.
- Discount block-sales to an investor if the unit mix wouldn’t absorb on retail.
- Apply a price-growth assumption — usually flat or very modest, rarely your bullish number.
- Net off incentives buyers have actually received in those comparables.
Why your GDV model often reads higher than the valuer’s
- You are using asking prices, not sold prices.
- Your “comparables” are the best recent sale, not a median.
- You haven’t discounted for volume absorption on large schemes.
- You’re assuming market growth during the build period; the valuer usually isn’t.
Every 1% movement in GDV moves your senior loan by 0.6–0.7% (at 65–70% LTGDV). A 5% GDV haircut is often the difference between a workable capital stack and needing mezzanine.