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Abstract
Vacant urban land exists in major metropolitan areas and begs the question, why has the property never been developed. The purpose of this dissertation is to provide an answer to this question by estimating the real option values associated with vacant land ownership. Real options included in this dissertation are the development option and option to seek a zoning change. The methodology utilized in this dissertation includes option pricing and empirical analysis. The first paper estimates land values where development is limited to a single use allowed by zoning. Land is valued by specific land use categories. The second paper estimates land value using a residual technique when a zoning change allows for higher valued land uses.