Park or develop?

You summed it all pretty well

If you have a good development plan, stick to it, and hopefully you will be rewarded in time.
The thing is, you need motivation to maintain the project alive. Sometimes people look at web development like some sort of solution for semi-mediocre domains that don't get type-in, but the monetary gains are not as good as expected. Some niches are difficult too, either they don't pay well or there is too much competition.

If you are passionate about it, stick to your plans and be patient.
But remember that websites must live and breathe. You just can't put up some website, leave it on auto-pilot and forget about it. They eventually rot and fall into oblivion and off the serps.

Are you certain the site was "panda-lized?" There are some niches where Google has pretty much thrown everyone except authority sites and/or big brands to the curb.

That said, if you believe you've exhausted your options and parking was much more profitable, makes sense to go back ...You will lose those back links over time.

If you worked hard to get valuable back links that are worth keeping after you developed it, another thought is to move the site to a different domain, tell the linking sites that it has moved, 301 the domain to the new site for a while while the new URL gains traction and the links get updated, then park it.

(Not a good idea if there's a chance your site was hit by penguin not panda ...)

Thanks; I forgot to add a few details:

1) When I got the domain, it was a dropped name with existing backlinks giving it a good PR, and I think some of the traffic was coming from the links.

2) The site has a long way to go in recouping its development costs, and this after several years being a website. If it was parked, it would have exceeded the development costs by now.

3) Maybe I could try shifting ad placements or selling affiliate products, but the visitors are just not responsive in this niche....and I highly doubt it would make much, if any difference. However, as a parked domain, it was earning rather good. That was one of the reasons why I developed it in the first place....thinking it would earn better with more visitors.

You need to know who your visitors are, where they are coming from, and what they are looking for.
You say the domain is now developed but are you monetizing with adsense or something else ? The ads may be quite different than in the past and may need some tuning. They may not be relevant anymore, thus leading to low CTR.

Another thought.
backup your site to your computer.
Then park the domain for 3 months to see if you get some decent revenue.
If you do, keep it parked.
If not, then use the backup and go back to building the website.

while a backup is good, all he has to do is change the nameservers.

the site can remain where it is, with no domain pointed to it.

ready to go back to a developed site? just change the nameservers back and there it is.

While there are pro developers who do very well with development, domain investors tend to not fall into that group. The prime beachfront type-in traffic property was taken 12 to 15 years ago or more. One does see occasional drops of former websites being auctioned at Godaddy Auctions. The keywords suck but I suppose they pay for themselves via inbound links which generate some parking revenue.

Owning a domain and parking it is like owning a vacant lot and putting a sign up offering parking for a few bucks. Perhaps the lot is a reasonable distance from the beach or an athletic venue or mall where at least on certain occasions people might be willing to pay for a parking spot. The decision to convert that vacant lot into a hotel or apartment complex or shopping center is a totally different decision which involves considerably greater investment and risk as there is no guarantee the investment will generate a favorable return on invested capital (or effort). Keep in mind a website which doesn't rank on page one of a major search engine for some search phrase will be virtually unknown unless it is marketed via social media channels. Even with search traffic, monetization is a separate issue. Google Adsense and affiliate click through rates can be really disappointing. I recall having some 750 thousand affilliate impressions at Commission Junction without even one dollar of affiliate earnings. Google Adsense CTR is normally low single digits and I saw more than an 80% drop in traffic post-Penguin/Panda on some of my sites. Even prior to that drop I had already soured on the idea of development as it is difficult to justify development costs with an occasional Adsense click.

Newbies buying up every new TLD that gets launched and paying premium renewals are in for a tough wakeup call if they think they will just develop if no aftermarket emerges.

Thanks for all the replies, guys.

I think I will likely park it...if only to test again. I just worry that Google may not like it, and I wonder about their reaction...or any penalties should I decide to return back to the website at some later stage.

If anyone had a similar experience.....like park, develop, park, and then return back to website, please share your experience.

my choice is parking

i received decent traffic to my parking websites & earning more than my developed websites

IMO.