The optimal combinations of the eligible functions in multiple property assets enhancement

Highlights

• •

  The research develops a model for defining the optimal combination of the new intended uses in the various public properties located in a specific territorial context.

• •

  The mix of the intended uses identified by the model maximizes the financial conveniences of the parties involved.

• •

  The outputs generated by the model constitute a valid support for Public Administrations and private investors in all the phases of an enhancement concession procedure.

• •

  The simplification of some phases of a traditional DCFA provided by the proposed model reduces the possibility of manipulating the results.

• •

  The effective re-use of these properties can actually help to prevent further soil consumption.

Abstract

The present research concerns the procedures of concessions for the improvement and exploitation of public property assets. We propose a model that helps to define the optimal combination of novel uses in public properties. This model is an answer to the need for effective strategies to find new functions for disused buildings or abandoned areas.

The model integrates the logic of the Discounted Cash-Flow Analysis (DCFA) and the goal programming for determining the new functions, to identify the macro-solution that maximizes the financial conveniences of the parties involved (Public Administration and private investor), in terms of monetary compensation for the Public Administration and return on investment for the private operator. The algorithm of the model has been applied to five existing public properties located in the city of Rome (Italy); for each property a specific procedure of concessions for the improvement of public assets can be activated and different eligible enhancement projects can be realized. The outputs generated by the optimization model are a valid decision support in all the phases of the concession procedure to identify the (public and private) strengths and weaknesses concerning the redevelopment initiatives on public properties. The effective re-use of these properties can actually help to prevent further soil consumption.