Real assets can be redeveloped repeatedly. Unlike financial assets, th
e option to redevelop real assets can be exercised infinitely often. F
or a depreciating real asset, the optimal exercise policy and resultin
g market values are calculated analytically and compared to the standa
rd solution with at most one redevelopment. Relative to the standard s
olution, redevelopment is on average more frequent and less extensive,
and the resulting market values are greater.