Sorry for the long post, lots to detail.
So I haven’t updated in quite a while on my progress, mostly just a lurker and chip in some knowledge where I can, but things are definitely moving.
I think my last update was about the first property we picked up to flip a couple years ago.
Long story short I ended up flipping a couple places, made some decent money, gained quite a bit of wisdom. The point all along was to roll that coin over into being a full time home builder.
I’ve got my own company now with our first build done and behind us and 3 more homes on the go as well as a very large duplex reno. 2 of the homes are already sold, the other is a spec and I’m sure soon to be sold.
So things are coming along great.
My intention was to always get into larger deals such as land development and commercial projects at some point, but thought I’d have to wait till I had a cash position to finance them.
There is quite a few prime pieces of property available right now however, and it’s really dawned on me that my plan wasn’t fastlane enough. Why wait till I have the money, when I can get an investor on board and do it now?
The piece of land I’m focusing on, and the one I’d like to find an investor for is over 30 acres, and has appropriate future zoning for what I have in mind.
It’s been for sale for quite a while, but for the longest time its future was in limbo while the local government decided on a development plan for the area. During that time, all the usual big money guys came and looked and left because its fate was uncertain. However, I had a meeting with the planning manager just after it had just been decided what to allow for the area. And it’s positive news.
From what I was told by the realtor, no large developers have been back to inquire about the land again. As far as I know, I’m currently the only one who’s interested in it, and knows the details about its status.
What I’ve got planned for the land, is a 9 building condo development. 1080 units total. Building code changes that are just coming through the pipeline, are enabling me to fit an additional 50% more units with the same footprint than I would have been able to before, (720 units).
Its location is perfect for something like this, and the local government wants this type of development. Urban sprawl is becoming a serious concern around here, and they want and need more projects like this.
The numbers are very impressive on it. I know what it costs me per ft. to build a basic home, using those numbers for the condo, and a rather conservative selling price per unit. After land and servicing costs, I’m looking at about $80million profit.
But as anyone knows who’s done something like this before, I won’t be paying $10/ft for framing, or $6/ft for hardwood like I do for a house. With 120 units per building, and 9 units to get the work on, trades will be competing hard for the work. Even at lower costs per foot, condos are a gravy train for everyone, and so everyone wants them. I’ll be able to get in granite by the container load, toilets by the container etc.
Long story short my costs per ft are going to be pretty cheap on something this big. I’ve already got experience pricing some larger houses/commercial type stuff. And using my more realistic numbers the project will more likely profit around $130million.
This is the point where I need some advice however.
I’ve always done things on my own, and have never had to find a partner/investor. Especially for something like this.
I’d like to have enough of an investment to buy the land, service and develop it (paved parking lot etc.), and construct 2 buildings. After that I could roll the sales of units into constructing subsequent buildings.
About $30million is what I’d need.
I had a meeting with JackEdwards as per is thread Diary of Opening a New Business, and he gave me some great insight into finding investors. But I thought I’d create this thread as well while I continue to pursue that to see what other insight people can give on something like this.
Like I said, I’ve got no experience at all with finding investors for such large sums, and looking to learn from the wisdom of those here. Hopefully others reading this can learn as well. Most info on this site seems to be geared towards internet business, and not so much brick and mortar. So anything additional we can get on B&M on here is very valuable IMHO.
I’ve also considered going right to a bank for financing. I’ve heard that lending on commercial projects is completely different that single family, and is based more on the project than the individual.
So if anyone has any experience or insight into how to find investors for this much money, how to approach a bank, and what type of things both are going to want to see from me/how I approach them etc.
Thanks in advance.
So I haven’t updated in quite a while on my progress, mostly just a lurker and chip in some knowledge where I can, but things are definitely moving.
I think my last update was about the first property we picked up to flip a couple years ago.
Long story short I ended up flipping a couple places, made some decent money, gained quite a bit of wisdom. The point all along was to roll that coin over into being a full time home builder.
I’ve got my own company now with our first build done and behind us and 3 more homes on the go as well as a very large duplex reno. 2 of the homes are already sold, the other is a spec and I’m sure soon to be sold.
So things are coming along great.
My intention was to always get into larger deals such as land development and commercial projects at some point, but thought I’d have to wait till I had a cash position to finance them.
There is quite a few prime pieces of property available right now however, and it’s really dawned on me that my plan wasn’t fastlane enough. Why wait till I have the money, when I can get an investor on board and do it now?
The piece of land I’m focusing on, and the one I’d like to find an investor for is over 30 acres, and has appropriate future zoning for what I have in mind.
It’s been for sale for quite a while, but for the longest time its future was in limbo while the local government decided on a development plan for the area. During that time, all the usual big money guys came and looked and left because its fate was uncertain. However, I had a meeting with the planning manager just after it had just been decided what to allow for the area. And it’s positive news.
From what I was told by the realtor, no large developers have been back to inquire about the land again. As far as I know, I’m currently the only one who’s interested in it, and knows the details about its status.
What I’ve got planned for the land, is a 9 building condo development. 1080 units total. Building code changes that are just coming through the pipeline, are enabling me to fit an additional 50% more units with the same footprint than I would have been able to before, (720 units).
Its location is perfect for something like this, and the local government wants this type of development. Urban sprawl is becoming a serious concern around here, and they want and need more projects like this.
The numbers are very impressive on it. I know what it costs me per ft. to build a basic home, using those numbers for the condo, and a rather conservative selling price per unit. After land and servicing costs, I’m looking at about $80million profit.
But as anyone knows who’s done something like this before, I won’t be paying $10/ft for framing, or $6/ft for hardwood like I do for a house. With 120 units per building, and 9 units to get the work on, trades will be competing hard for the work. Even at lower costs per foot, condos are a gravy train for everyone, and so everyone wants them. I’ll be able to get in granite by the container load, toilets by the container etc.
Long story short my costs per ft are going to be pretty cheap on something this big. I’ve already got experience pricing some larger houses/commercial type stuff. And using my more realistic numbers the project will more likely profit around $130million.
This is the point where I need some advice however.
I’ve always done things on my own, and have never had to find a partner/investor. Especially for something like this.
I’d like to have enough of an investment to buy the land, service and develop it (paved parking lot etc.), and construct 2 buildings. After that I could roll the sales of units into constructing subsequent buildings.
About $30million is what I’d need.
I had a meeting with JackEdwards as per is thread Diary of Opening a New Business, and he gave me some great insight into finding investors. But I thought I’d create this thread as well while I continue to pursue that to see what other insight people can give on something like this.
Like I said, I’ve got no experience at all with finding investors for such large sums, and looking to learn from the wisdom of those here. Hopefully others reading this can learn as well. Most info on this site seems to be geared towards internet business, and not so much brick and mortar. So anything additional we can get on B&M on here is very valuable IMHO.
I’ve also considered going right to a bank for financing. I’ve heard that lending on commercial projects is completely different that single family, and is based more on the project than the individual.
So if anyone has any experience or insight into how to find investors for this much money, how to approach a bank, and what type of things both are going to want to see from me/how I approach them etc.
Thanks in advance.
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