Melbourne Development Feasibility Calculator - Free Tool for Developers | Pekaj Group

How the calculator works

This tool runs a full development feasibility model across eight steps. It follows the same structure a quantity surveyor or development manager would use to assess a project before recommending whether to proceed.

You work through each step in sequence.

Step 1 — Project overview. Select project type (townhouses, apartments, subdivision, commercial), enter gross floor area, site area and programme duration.

Step 2 — Land acquisition. Enter purchase price and the tool calculates Victorian stamp duty automatically. Add due diligence, legal and survey costs.

Step 3 — Revenue. Build your unit mix with the number of dwellings, floor area per unit, sale price per unit and parking revenue. The tool handles GST calculation using either the standard or margin scheme method.

Step 4 — Construction. Enter a per-square-metre construction rate or lump sum. Adjust for overheads, margin, contingency and escalation. The tool includes a full elemental breakdown if you want to go deeper.

Step 5 — Soft costs. Professional fees (architect, engineer, building surveyor, project manager), council contributions, authority charges, insurance and land tax.

Step 6 — Finance. Set your loan-to-cost ratio, interest rate, line fees, establishment and exit fees. The tool runs an equity-first monthly debt model that calculates total interest cost based on actual drawdown timing, not a flat percentage.

Step 7 — Selling costs. Agent commission, marketing, legal per unit, display suite and warranty insurance.

Step 8 — Returns and analysis. This is where it all comes together. The tool produces profit on cost, profit on GDV, return on equity, equity multiple, residual land value, NPV, IRR, break-even analysis and three-scenario stress testing.

What you get from the output

The returns dashboard gives you the numbers that matter for a go or no-go decision.

Profit on cost is the headline metric most Melbourne developers use to assess feasibility. The tool colour-codes this against industry benchmarks. Above 20% is strong, 15 to 20% is viable, below 15% needs scrutiny.

Return on equity and equity multiple shows what your actual cash invested earns, not just the project-level return. This is the number that matters if you are weighing this project against other uses of your capital.

IRR is the internal rate of return accounting for the timing of cash flows across the hold, construction and settlement periods. A development that returns 20% profit on cost over 36 months is very different from one that returns 20% over 18 months. IRR captures that difference.

Break-even analysis tells you what sale price per unit, land price or construction rate you would need to hit your target margin. This shows how much room you have before the project stops working.

Scenario testing covers base case, upside and downside. Adjust revenue, construction cost, land cost, programme duration and interest rate to see how sensitive your profit is to market movements.

Waterfall chart gives you a visual breakdown showing how gross revenue flows through land, construction, soft costs, finance, selling costs and GST to arrive at net profit.

Who this tool is for

Developers — use it to assess a site before you make an offer. Plug in the asking price, your expected revenue and a construction rate estimate. Within 15 minutes you will know whether the project has enough margin to justify the risk.

Builders doing their own developments — use it to understand the full financial picture beyond just the build cost. A project that looks profitable at construction level can become marginal once you factor in finance costs, holding costs and selling costs.

Architects advising developer clients — use it to test whether a design concept is financially viable before committing to full documentation. If the feasibility does not work at concept stage, redesigning now is cheaper than finding out after tender.

Important notes

The finance model uses an equity-first monthly simulation. This means it draws down equity before debt, calculates interest monthly on the actual debt balance, and accounts for the timing of land settlement, construction payments and revenue receipts. It is more accurate than flat-rate interest calculations that most spreadsheet feasibilities use.

Victorian stamp duty is calculated automatically using current rates. If your project is in another state, switch to manual entry and input the correct figure.

The output is a planning tool, not financial advice. Development feasibility is sensitive to small changes in assumptions. A 5% shift in sale prices or a 3-month programme blowout can turn a viable project into a loss. Always verify assumptions with project-specific professional advice before committing capital.

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Want a professional feasibility assessment?

This tool gives you a fast read on whether a project is worth pursuing. For a detailed feasibility report prepared for lender submission, board approval or investment committee review, with verified construction costs, market-tested revenue assumptions and sensitivity analysis, get in touch.

1300 420 227 | info@pekajgroup.com.au

Pekaj Group provides initial feasibility reports, cost planning and quantity surveying services across Melbourne and regional Victoria.

Related resources

• Melbourne Construction Cost Calculator — get an instant build cost estimate to feed into your feasibility
• 2026 Melbourne Trade Rates Guide — current subcontractor rates across all trades
• Quantity Surveying FAQ — including QS fees, lender reports and progress claims

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