How Construction Feasibility Studies Guide Building Decisions

There are countless steps taken by stakeholders to ensure the success of a construction project — and many questions that need answering before getting started. Can the project be built in this location? What can be built — and what can’t? When can the project start, and what’s required to make it happen? Stakeholders for every construction project explore these questions with a site feasibility study.

Construction feasibility studies can take many forms. What the study includes, who conducts it and how it’s formatted all depend on the company behind it, the site in question and the project goals. Having a basic understanding of construction feasibility helps avoid pitfalls that can negatively affect the project — or even make it impossible to complete. 

In this article, we will explore the ins and outs of feasibility studies for construction projects: how they’re created, how they affect what is built and some of their use cases.

What is a construction feasibility study?

Similar to a pro forma—where owners evaluate whether or not a construction project will be financially successful—a feasibility study is the process of researching the location and design of a building before starting a project to determine its success. The goal of performing these studies is to prevent a project’s failure by looking into everything builders could run into, from geological hurdles to sociological concerns. 

How does a feasibility study for a construction project site work?

Site feasibility studies are conducted during the preconstruction phase before any designs are finalized. These studies evaluate factors that may shape the design for the project in a significant way by determining what is — and isn’t — possible on the site. As a result, the study should kick off when the project is proposed but before the drawings are finished. 

The feasibility study seeks to answer two key questions: Can the project be constructed with the intended design on the selected site? Once built, will the project meet or exceed expectations? Because the answer to that question varies depending on the chosen site and the project's goals, evaluating construction feasibility is often a fluid process. 

That said, site feasibility usually looks at three categories: location feasibility, followed by design and social feasibility.

Location Feasibility

This part of the feasibility analysis evaluates the site itself. Is it zoned appropriately? Are there any municipal, provincial or federal parameters that could affect the project? What about on-site geological hazards and proximity to potential issues (e.g., airports, brownfields)? In short, location feasibility evaluates whether or not the intended project can and should actually be constructed on the chosen site. 

Design Feasibility

Once the location is confirmed as viable — including sign-off from the owner and civil engineers on location feasibility — design feasibility gets underway. This portion of the process explores whether the desired design can work on the site.

Design feasibility uses early-stage plans and specs to determine if the vision for the project aligns with what’s possible on the ground. In many cases, design feasibility studies identify a range of possible options. 

As a best practice, stakeholders on every project should consider construction feasibility at the site in question. Fortunately, this doesn’t have to be a major hurdle for the project. With a seasoned team, turnaround time on a site feasibility study is generally fairly quick. 

Social Feasibility

Feasibility studies test more than just if a building can be built, but also whether they should. For many builders, the local community’s reaction to the project is just as critical as construction feasibility. Even a beautiful, well-designed building can go vacant if its intended users reject it. Adding a community feedback element to a feasibility study sets owners up to see success upon completion.

For example, a local survey might reveal that community members are furious about using the parcel for a commercial space when the municipality desperately needs housing. Converting the project to a mixed-use building with an additional storey of residential spaces could ease concerns. Beyond that, it could set the project up to be well-received — and regularly used — upon completion. 

Who conducts a site feasibility study?

An individual or team with specialized experience should handle the feasibility study for construction project sites. Larger design-build firms often have an in-house division ready to explore the feasibility of any project they take on. 

For companies that don't have an internal feasibility function, contracting out to feasibility consultants helps to ensure they receive the fleshed-out, informative study the project requires. When hiring a consultant, companies should look carefully into the consultants’ qualifications to ensure they have experience on similar projects. 

Once the study is completed, the owner — along with applicable architects and engineers — needs to review it. The review process warrants more than a quick skim. Overlooking the study could have serious ramifications for the success of the project. 

For example, the construction feasibility study might point out that surrounding transportation could be a challenge or that protected wetlands are nearby. Leaving obstacles unaddressed could mean the project stalls out midway. Worse yet, it could render the project unfit for its intended purpose once it’s completed.

What’s in a site feasibility study?

The formatting of a site feasibility study varies depending on the company behind the report, the owner’s requirements and the specific site. It might be a checklist that gets operationalized or a standardized template with categories that various teams at the firm complete. 

Ultimately, the formatting of the feasibility study for construction project sites matters less than what that study contains. Here are a few key areas to consider including:

• Zoning
• Budgetary considerations, including:
• Geological hazards, including:
• Legal considerations
• Approvals and permitting from applicable regulatory bodies (e.g., municipal planning departments)  
• Environmental considerations, including:
• Utilities (e.g., do existing hookups exist?)
• Easements and other restrictive covenants
• Incentives attached to the site (e.g., tax credits)
• The surrounding area, including:
• Operational feasibility, including:
• Site use upon completion, including:

Feasibility Study Use Cases

At their core, site feasibility studies serve as a risk management tool. As the study was created, people experienced evaluating everything from physical sites to budgetary considerations examining key areas. Once the study is prepared, it gives owners and other stakeholders the opportunity to understand what the project will entail before it gets too far along to make changes. 

Here are a few examples of how companies can use site feasibility studies to set projects up for success.

• Legal Feasibility

  Putting the study in front of the legal team gives them a clearer understanding of the project in its entirety, including how it interplays with applicable regulations and which governing bodies are involved. Say the study identifies that the site is near protected wetlands or in a historical district. A review of the study allows the legal team to flag anything that could make the project impossible from a legal standpoint. It also gives them the opportunity to prepare for hurdles that could arise.

• Construction Feasibility

  The site feasibility study could uncover factors that significantly affect the build. The project may have planned for a large underground parking garage, for example, but the soil test conducted as part of the study reveals that the site is littered with giant rocks. Excavating those rocks may eat too much of the budget, leading the owner to elect to move to a new site. 

• Design Feasibility

  The site feasibility study could uncover factors that significantly affect the build. The project may have planned for a large underground parking garage, for example, but the soil test conducted as part of the study reveals that the site is littered with giant rocks. Excavating those rocks may eat too much of the budget, leading the owner to elect to move to a new site. 

• Scheduling Feasibility

  Feasibility studies can be used for their granular details. When planning the project’s timeline, teams can leverage evaluated areas like procurement and weather feasibility to create the most accurate schedule possible. 

• Financial Feasibility

  Owners may not be the only parties concerned with how realistic the project is based on the budget and the profits it can yield upon completion. A site feasibility study gives investors a way to see that due diligence has been conducted, safeguarding any money they choose to put up. 

• Rebuild Feasibility

  It’s not uncommon to operate under the assumption that if a building exists on a site, it can be demolished and something similar can be rebuilt. But between zoning changes, new environmental protections and more advanced geological survey technology, plenty of obstacles can arise. Conducting a feasibility study for construction project sites where demos and rebuilds are planned gives stakeholders a way to ensure the project can actually work — and to do so before anything is torn down. 

Site feasibility studies help owners and other stakeholders avoid disaster. But they’re not just a risk mitigation tool. When done right, they can yield remarkable results. 

The John Street Roundhouse, built in 1929 as part of the Canadian Pacific Railway, was preserved during redevelopment after a feasibility study recognized its historical value. Rather than demolishing it, the space was transformed into Roundhouse Park, housing the Toronto Railway Museum, a brewery, and restaurants, all while maintaining its railway heritage. 

Answering the Key Question: Is it Feasible?

Site feasibility studies to answer one question — is this project feasible? Feasibility studies give stakeholders a way to identify obstacles before it’s too late, plan projects more intelligently, and potentially identify opportunities to make more of the completed project. 

During the study, stakeholders may learn new information that could be a detriment to the entire project, or possibly inspire the design for greater success.  As a best practice, every construction project should undertake this step. As technology advances — like reality capture drones — conducting these studies should get both easier and more informative. 

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