Development site ground risk: a feasibility and due diligence checklist

A development site is bought on a yield, and the yield is built on assumptions about ground nobody has drilled. How many lots, how much retaining, whether the basement is one level or two, whether the earthworks balance or 4,000 cubic metres have to be carted off. Every one of those numbers is a ground assumption wearing a dollar sign.

The uncomfortable part is how little of the budget usually goes to testing those assumptions. A review of one Australian project (Australian Geomechanics Society, 2000) noted investigation spend as low as a few tenths of one per cent of total project cost, against an international recommendation of around three per cent. Kelly et al. (2020) put the counter-argument well: spending is not linear, returns diminish, and an investigation scaled to a large percentage of tender cost would be indefensible. The point is not to spend more. It is to spend early, on the questions that decide the deal.

This checklist runs in the order the decisions arrive.

Stage 1: before you offer

At this point you are deciding whether the site is worth a due diligence period at all. Everything here is desktop work and should take an afternoon.

• Confirm the whole holding. Multiple lots, part-lots, road reserve and easements change the developable area before geology does.
• Identify the mapped geological unit or units. One unit under the whole site is a different risk profile from three, and a boundary running through the middle predicts where conditions change.
• Read the terrain, not the contour plan. Total fall, the direction of fall, and any break of slope. Break lines often mark old gullies, fill edges or the top of a rock shelf.
• Look at historical aerial imagery. Quarries, dams, gullies, stockpiles, batters and old building pads all leave a signature, and all of them mean fill somewhere.
• Check nearby borehole logs. Depth to clay, depth to refusal, groundwater levels, and how much adjacent logs disagree with each other.
• Screen the hazard layers. Flood, landslip, acid sulfate soils, contamination and mine subsidence each carry their own approval pathway and their own cost line.

Stage 2: during the due diligence period

Now you are converting screening into priced risk, and the clock is running. The work here is to decide which unknowns you will pay to close and which you will price or walk away from.

• Write down the three ground assumptions the feasibility depends on. Usually founding depth, cut and fill balance, and whether the site can support the parking or basement design.
• Test each against the desktop evidence. Assumptions that survive can be priced; assumptions that conflict with mapped geology or nearby logs need field data before settlement, not after.
• Scope the investigation to those questions, not to a standard fee. Andrews (2006) makes the point that the scale of a geotechnical investigation is really a choice about how much risk the developer keeps, and that a small scope does not remove cost. It relocates it, because a designer with thin data has to design conservatively and the conservatism shows up in construction.
• Decide who carries latent conditions. Where an investigation is preliminary only, the consultant stands behind the factual data and the developer keeps the risk of changed strata and unexpected conditions. That is a commercial choice, and it should be a conscious one.
• Check the approval-stage geotechnical obligations. On sloping land in particular, council planning controls can require geotechnical assessment and staged verification before certificates issue, which is a program item as much as a cost item (Walker et al. 2007).

Stage 3: before you lock the yield and the concept

• Reconcile lot layout with the ground model. Lots sitting over the deepest fill or the steepest fall are the ones that will need engineered footings, and they should not be the ones you priced as standard.
• Check the earthworks balance against the material, not just the volumes. Cut that is rock is a different rate. Cut that is reactive clay is fine as fill only if it is placed and tested as controlled fill, and the classification still has to account for it.
• Look at what the platform does to the footings. Filling a lot to make a flat pad can put every footing on fill and shift the whole cost into engineered slabs.
• Set floor levels against the flood, drainage and retaining picture together. Moving a floor level 300 mm at concept stage is a redraw; moving it after approval is a resubmission.

Stage 4: before you tender earthworks, piling or footings

• Give tenderers the ground model you have. Collingwood (2003) observes that unforeseen ground conditions are the most common source of delay on piling projects, and tenderers who cannot see the data price the uncertainty back to you as contingency.
• State what is known, what is inferred, and what is untested. A desktop model presented as fact creates a claim. Presented as a hypothesis with its evidence, it lets a contractor price sensibly.
• Keep the residual risks visible. Groundwater level through the season, the variability between logs, corestones or floaters in weathered rock, and any fill of unknown provenance.

Where the desktop work stops

A desktop assessment builds an evidence-based expectation of what is under the site and tells you where it is most likely to be wrong. It cannot give you founding levels, design parameters or a site classification, and nothing in it is engineering advice for a specific project. What it does is make the investigation you eventually pay for hit the right depths in the right places, which is exactly the argument Kelly et al. (2020) make for connecting investigation scope to the project's actual risks rather than to habit. If you want the boundary drawn precisely, we set it out in what a geotechnical desktop study covers.

Run the desktop evidence before the due diligence clock starts: generate a desktop report for the address for the sites on your shortlist, or see a sample report to judge whether it answers the questions your feasibility rests on.

LayeredGeo compiles geology, soils, groundwater and site data into an automated geotechnical desktop report for any address in Queensland, New South Wales or Victoria.

Sources

• Australian Geomechanics Society (2000). Geotechnical risk and inadequate site investigations: A case study. Australian Geomechanics, Volume 35, Number 2 (Jun 2000). geomechanics.org.au
• R. B. Kelly, M. Drechsler and R. Goldsmith (2020). Connecting Geotechnical Investigations with Project Risk. Australian Geomechanics, Volume 55, Number 1 (Mar 2020). geomechanics.org.au
• Peter V. Andrews (2006). The hidden cost of geotechnical investigations. Australian Geomechanics, Volume 41, Number 4 (Dec 2006). geomechanics.org.au
• Bruce Walker, Warwick Davies and Grahame Wilson (2007). Practice Note guidelines for landslide risk management. Australian Geomechanics, Volume 42, Number 1 (Mar 2007). geomechanics.org.au
• Ben Collingwood (2003). Geotechnical Investigations For Piling Projects - The False Economy Of A Cheap Site Investigation. Australian Geomechanics, Volume 38, Number 1 (Mar 2003). geomechanics.org.au

About this article. Published by LayeredGeo and written from the published research cited in the Sources section above. It is general information about how property and ground conditions are assessed in Australia, not engineering, planning, legal or financial advice, and it is not specific to any property. Check anything that matters against the source dataset or a suitably qualified professional before you rely on it. If you spot something wrong, tell us at hello@layeredgeo.com.au and we will fix it.

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