What factors determine the economic feasibility of the highest and best use?

The economic feasibility of the highest and best use of a property is determined by several interrelated factors, and the correct choice encompasses the most significant ones: profitability, legal restrictions, and physical constraints.

Profitability is a critical component because it assesses whether the potential use of the property can generate sufficient income to justify the investment. Without the promise of a reasonable return, the proposed use may not be economically viable.

Legal restrictions refer to zoning laws, building codes, and other regulations that dictate what can be done with the property. These restrictions can significantly impact the feasibility of certain uses, as they may prohibit desired activities altogether or impose conditions that affect the financial outlook.

Physical constraints consider the tangible aspects of the property, including size, shape, topography, and infrastructure availability. These factors can limit what can be built or how the property can be utilized.

In combination, these three factors provide a comprehensive framework for evaluating the economic potential of a property's highest and best use, ensuring that all pertinent aspects are considered in the appraisal process.