Homebuilding

House Builder: Optimising master plans to maximise profit

The Challenge

Developing site master plans leaves ‘money on the table’

Process is complex, linear and takes up to 6 weeks for a single option

Plans are regularly altered during development as the market changes

Site bids based on historic data, rather than future predictions

A nationwide house builder was facing increased pressure on margins as competition increased and planners demanded more diverse site mixes. Putting together a residential site master plan is extremely complex and time-consuming. Our client had dozens of different house types, resulting in billions of potential combinations of layouts. The process they used to navigate this was linear and based only on historic pricing information. They knew it caused margin erosion.

The Results

A decision-support tool that maximised profit, with 15% extra on average

Billions of site combinations considered in seconds

Master plans based of predicted demand, rather than historic pricing

Instant scenario testing and mix customisation options

+15%

Average increase in profit contribution per site

Arca Blanca developed a decision-support tool that predicts an optimal site mix in a matter of seconds. A complex machine learning algorithm considers over 100 local attributes (demographics, transport, employment, wealth, quality of schools etc.) along with comparable transactions to predict future demand and pricing. This is then used to calculate the most profitable plan. The tool integrates user customisations, placemaking rules and planning regulations.