Feasibility analysis is defined as an investment’s ability to produce sufficient revenue to pay for all expenses and to provide a reasonable return and recapture of the investment. A project is considered economically feasible when the market value of the project when completed or after achieving a stabilized operating condition equals or exceeds all costs of production including entrepreneurial profit.

Analyzing the feasibility of a proposed use requires the appraiser to forecast future market conditions and the timing required to achieve either lease-up of vacant space or sales of the proposed units.