Real Option Framework under Build Then Sell (BTS) System

摘要

The Build then Sell (BTS) system is expected to be adopted in various countries in the Asian region which includes Malaysia where it will be made mandatory by 2015. In this paper, an analytical valuation framework will be presented under this BTS concept to solve the optimal time of sales and obtaining the market values of the developed properties and this framework could provide an estimation for the estate developement project intrinsic value which can serve as a basis for financial institutions to grant loans for financing property projects that have yet to be booked in any sales.