A highest and best use study seeks to identify which use would bring maximum value to a piece of vacant land or an improved parcel. A highest and best use analysis for a given property must meet certain criteria that flow in sequential order.

Highest and Best Use

The Highest and Best Use of a property refers to the reasonably probable and legal use of vacant land or an improved property that is physically possible, appropriately supported, and financially feasible and that results in the highest value.

A highest and best use study seeks to identify which use would bring maximum value to a piece of vacant land or an improved parcel.

A highest and best use analysis for a given property must meet certain criteria that flow in sequential order. The order is generally:

• Legally permissible
• Physically possible
• Financially feasible
• Maximally productive

The sequential order of legally permissible and physically possible may be applied in either order. However, a potential use must comply with both these requirements prior to moving into the financially feasible or maximally productive analysis. That is, a use that is not legally permissible by zoning or other restrictions, or that is not physically possible due to site or building limitations would not be considered for financial feasibility.