Financing
There is a site for sale which is a great development opportunity. Zoned multi-faminly can fit 3 houses on it. When putting an offer on this property what is the process, and how is a project like this typically financed? Can you put in the purchase agreement that its contingent upon 120 days permit approval and stuff like that? Would it be wise to have a set of plans before you make an offer, or just an good idea of what you will build?
Quote:
On 2003-10-24 13:44, jeffm_60 wrote:
There is a site for sale which is a great development opportunity. Zoned multi-faminly can fit 3 houses on it. When putting an offer on this property what is the process, and how is a project like this typically financed? Can you put in the purchase agreement that its contingent upon 120 days permit approval and stuff like that? Would it be wise to have a set of plans before you make an offer, or just an good idea of what you will build?
1. If it is zoned multifamily, why would you put single family houses on it?
2. What makes this property a great opportunity?
Many ways to put an offer on it. One way:
Offer your price with 120 days due diligence before money goes hard. Another 160 days for permits . Closing not until permits are pulled or 160 days.
$5000 additional for each 30 day extension after the 280 days.
(Change the amounts, change the days ,plug in your own numbers.)
Key is control the property while you get your plans, your permits, your engineering, etc.
You do not close until permits are ready to pull.
Good luck.
[addsig]
You would put single family so that you could sell if off and not have to manage a multi-family unit. The site is actually 3 parcels in a very high end area. All 3 parcels are selling for 325k. You can sub-divide and fit 5 single family homes on these. On the lot literaly right next door, a developer just pre-sold a home for 1.1 mil. We were thinking about putting up 5 homes selling for 500-600k each. There is a good market for these in this area right now. There is also a very good chance that the lots next door will go on the market which could mean a couple more units. Only problem is figuring out the best way to right up the offer. New at this, but with lots of money.
I would go with a version of the offer terms above. They are actually not unrealistic for developments - altho the terms are a bit long for property ready to go.
Good luck.
[addsig]