Entitlement Risk Calculator

Entitlement outcomes carry probability weights. This calculator sizes expected value.

Max entitled value

Modified value

Denial value

Approval probability %

Modification probability %

Weighted value

$10,375,000

Upside case

$12,000,000

Downside case

$4,500,000

How the math works

Weighted value = Σ(probability × outcome value).

Entitlement-contingent deals should price with significant margin above the probability-weighted value. Buyers routinely underwrite to the 'approval case' and lose 20-40% when modification or denial hits — the weighted value is the floor price, not the target price.

How to Use

Enter max entitled value (approval).
Enter modified entitled value.
Enter denial value (as-is zoning).
Enter approval probability %.
Enter modification probability %.
Read probability-weighted value.

Frequently Asked Questions

Entitlement outcomes?

Full approval: target density, maximum value. Modified approval: reduced density, conditions imposed (setbacks, height, affordability). Denial: as-is zoning only. Outright rejection rare; modification is most common outcome.

Probability calibration?

Straightforward rezones: 70-90% approval. Contested projects: 40-70%. Projects facing organized opposition: 20-40%. Public bodies trend modify rather than deny; rare to lose entitlement entirely but common to lose 30-50% of requested density.

Mitigation?

Community engagement 12+ months before filing. Developer agreements with conditions attached. Staff pre-submission reviews. Hire land use attorney with local track record. Each can raise approval probability 15-25%.

How often should I rerun this?

Rerun this calculator whenever inputs change materially — new rent roll data, rate moves, loan balance updates, or quarterly operating data. For active deals, monthly refresh is typical. For stabilized assets under monitoring, quarterly is fine. Treat the output as a decision tool, not a one-time answer — market conditions evolve and so should your analysis.