Gross Development Margin on GDV (GDM) expresses the gross profit of a property development as a percentage of its Gross Development Value (GDV), before deducting finance costs and taxes. Calculated by dividing gross profit by GDV and multiplying by 100, it offers a clear, unleveraged measure of a scheme’s profitability. This metric is vital within UK property development finance, enabling developers and lenders to gauge a project’s commercial viability early, assess potential returns, and make informed funding decisions based on the strength of projected income relative to market value.
This sits beneath Project-Level Profitability, introducing a more specific variant of the measure without changing its core interpretation. It is commonly considered alongside Average Scheme Delivery Margin (%), as both are closely related measures used to assess similar aspects of performance or risk. In funding terms, Gross Development Margin on GDV (GDM) is most commonly encountered in connection with Participation with Cap within the property development capital stack.
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