Property Development Planning

Most investors think city hall is the enemy. But the top 10% of land developers in Texas treat municipal staff like their most valuable business partners. And it's giving them 6-9 month head starts on everyone else: 1️⃣ The Planning Commission Meeting Attendance Strategy. * Show up to EVERY meeting for 90 days straight, even if you have no agenda items. * A few of commissioners will remember your face and commitment. * Staff notices who cares enough to attend regularly. 2️⃣ The Staff Coffee Meeting Approach. * Schedule informal coffee meetings with key department heads. * Focus on learning, not selling. * Pro tip: Ask about their biggest challenges, not your projects. 3️⃣ The Municipal Committee Volunteer Strategy. * Join planning advisory committees, zoning boards, or economic development councils. * A majority of inside information comes from committee discussions. 4️⃣ The Professional Development Sponsorship. * Sponsor planning staff to attend conferences or training. * This creates goodwill and positions you as a partner, not an adversary. 5️⃣ The Policy Workshop Hosting. * Host educational workshops on development trends for city staff. * Bring in expert speakers on topics like affordable housing or infrastructure financing. * An investor friend became the "go-to" developer for complex projects after hosting 3 workshops. * Staff now calls him first when challenging projects need solutions. 6️⃣ The Quarterly Market Update Strategy. * Provide regular market intelligence to planning and economic development staff. * Share absorption rates, pricing trends, and development activity. * Aim to become an unofficial market advisor to the city. 7️⃣ The Problem-Solving Partnership. * Identify municipal challenges and propose solutions. * One developer helped the city solve drainage issues on 3 public properties. * This established him as a problem-solver, not just another profit-seeker. * Now the city brings him opportunities before they hit the market. The biggest deals in land development don't come from better marketing. They come from better relationships with the people who control approvals. __ Tu Amigo, David Cabrera P.S. Most folks think this is “too much work.” Are they wrong?

6 keys of a property developer from a expert Property development is one of the most rewarding investments, but it follows a very clear process. If you understand these six essentials, you reduce your risks and increase your profit. 1. Market research Every smart developer starts with research. You must know: 💪🏿What type of houses people want 💪🏿What price range buyers can afford Which locations are growing and why Good research helps you choose the right project, the right suburb, and the right price. 2. Land purchase After doing your research, the next step is to secure the land. A good developer looks for: 💪🏿A strategic location 💪🏿A fair purchase price A land size that fits the project plan Buying the right land is where your profit begins. 3. Subdivision If you want to build more than one unit, subdivision is essential. Subdivision helps you: 💪🏿Create separate titles 💪🏿Increase the land value Sell units individually at a higher combined value This stage requires surveyors, town planners, and legal professionals. 4. Pull permits You cannot build without proper approvals. Permits protect you legally and show the project meets government standards. This includes: 💪🏿Zoning approvals [physical planning] 💪🏿Building permits [building board] 💪🏿Local authority clearances [municipality] 5. Build This is where your idea becomes reality. Professional developers: 💪🏿Engage a licensed builder 💪🏿Follow a construction timeline Manage costs and avoid overruns Quality construction ensures buyers trust your product. 6. Sale The final goal is to sell your completed units. To sell fast and at the right price, you need: 💪🏿 Strong marketing 💪🏿 Realistic pricing A good agent who understands the market A successful sale completes the entire development cycle. Three simple examples Example 1: You buy a block of land in a growing suburb, subdivide it into two, build two duplex units, and sell each unit separately for a profit. Example 2: You research the market and discover families want 3-bedroom houses. You buy land, build three 3-bedroom homes, and sell them quickly because the demand is high. Example 3: You buy a large block, get permits, build four units, and sell two. You keep the other two for rental income. Your development gives you both profit and long-term cash flow. PLEASE SHARE IT 🙏🏾

Real estate development is sexy but complicated, so I teamed up with the brilliant Brian K. Suiter to give you the specific step-by-step process of developing real estate. Enjoy! 1. Determine a development thesis (what, where, when, how) 2. Find property you can afford based on access to debt and equity (more on this later) 3. What "by right" allowances am I permitted? Zoning, entitlements, capacity, utilities, restrictions, etc. 4. Design capacity drawings. What "by right" am I allowed and what beyond that can I achieve? 5. Translate capacity drawings to a financial proforma. Engage contractor for costs and understand market economics, soft costs, financing costs and carry. 6. Does this make money?...based on a risk adjusted return and on your thesis. 7. Put property in contract (perfect scenario, this would happen as late in the process as you can negotiate.) 8. Due diligence on site, including municipal and neighborhood due diligence and Market Study. 9. Close 10. Produce design documents from architect, engineer, land planner, designers, etc. 11. Update proforma. GC to price. Confirm income assumptions and update soft costs. 12. Engage government and neighborhood bodies with review/ approval rights in entitlement, zoning and planning process. Get all approvals. 13 Produce Construction Drawings with architect, et al. 14. GC to price and schedule.  15. Value-engineer 16. Submit plans for permits. 17. General contractor collects bids from subcontractors and contracts with all/ majority of divisions. 18. Construction starts. Manage GC, construction budget and schedule.  19. Loan Draws, Marketing, Investor Updates, Etc. 20. Complete construction. 21. Final Inspection. 22. Certificate of Occupancy. 23. Move tenants in. 24. Collect rent. 25. On going management and financial obligations. Note that we can't fit everything in one, long post. This is already too long, but I wanted to be specific. Let me know what steps you'd like for me to expand upon in future posts! Photo: A development I had the privilege to tour last year in Columbus #realestate #commercialrealestate #realestatedevelopment

Here's what you need to know to evaluate a real estate development deal: Pre-Construction & Acquisitions - Zoning - Entitlements - Architecture & Design - Construction documents - LOI / PSA - Negotiations Construction - Land price - Broker commissions - General conditions - Builder's risk insurance - Sitework and infrastructure - Vertical costs - General contractor fee - Hard cost contingency - Architecture and engineering - Start up costs - Impact and municipal fees - Financing fees / carry - Time to first units Operations - ProForma rents - Rent growth - Rent Concessions - Operating expenses - Lease-up pace - Other income - Time to stabilization Debt Financing - Construction debt is typically floating at SOFR +/- 350. That's 8.81% all-in at today's rate. - If a project is penciling to a +/-7% YOC, you can understand why many deals are dying. - If the builder has the execution ability to build and stabilize quickly, you can get agency debt for +/- 6% right now, but it's usually a question of proceeds to take out the construction financing. - The other strategy is of course to build, stabilize, and sell as a merchant builder, but it's always good to have multiple viable exit options. Disposition - Exit cap rate - F-12 NOI at sale - Exit valuation - Cash flow prior to sale - Time to sale - Broker fee - Other closing costs Return Thresholds - Yield-on-Cost as an appropriate spread over market cap rate (usually 125 bps+) - IRR and Equity Multiple will depend on if the developer is a merchant builder (sell right at stabilization) or if they hold onto the asset for awhile. However, most investors like to see the IRR north of 20% for development deals irrespective of hold period. There you go! A brief overview of primarily the underwriting, but also some of the behind-the-scenes to bring a real estate development deal to life. What are some other items you would add in there / what do you have questions about regarding CRE development? #realestate #development #CREeducation

After 40+ years in property development with zero DA rejections, I've observed a shocking paradox: people spend more time researching a mobile phone purchase than a million-dollar development site acquisition. While 75% of small developer applications face problems and delays of up to 289 days, the root cause isn't complex regulations or difficult councils - it's that most developers approach development completely backwards, buying first and hoping the numbers work out later. The truth is, property development is pure mathematics where preparation prevents problems, but most developers fall into predictable traps that turn what should be a systematic process into an expensive game of chance. Read on to discover the mathematical approach that's kept me rejection-free for four decades and why quality consultants actually save money in the long run.

Most people lose money on a development idea before a shovel ever hits the ground. They pay for plans. They pay for surveys. They start talking permits. Then they find out the property doesn’t work the way they thought. That’s why we always start with pre-feasibility. For property owners here in Washington, especially across Western Washington and the Puget Sound, zoning alone doesn’t tell the full story. Every city is different. Utilities, access, fees, trees, and local permitting rules can change the outcome fast…sometimes enough to kill a project altogether. A pre-feasibility review helps you figure that out early • What actually works on this property • What doesn’t • And whether it makes sense to move forward at all Finding out early is what saves money. If you own property in King County, Snohomish County, or Pierce County whether that’s Seattle, Bellevue, Kirkland, Everett, or anywhere around the Puget Sound and you’ve been wondering if your land could really add value, this is where we usually start. Be sure to follow for more insight and updated information. Have land you’re curious about? Comment LAND and to start the conversation.