Developer War Stories
I'm interested in getting into 2 main real estate development areas:
Ground up development, ie, building residential houses from the ground up, and adding value to already existing houses, duplexes etc.
I am interested in hearing war/horror stories that outline some of the common hurdles this area of investing faces.
In addition, I would be interested to talk to any contractors in the Chicagoland area that anyone would recommend.
Thanks.
You might want to expand the definition of "development" to include changing a property in some way that enhances its value. Developers don't necessarily stick a shovel in the ground--that's what builders do. Developing land, for instance, can be getting a zoning change or getting subdivision approvals and then selling the property to a builder.
Developer horror stories? What is this Halloween?
You mean like the time I had a million-dollar project in trouble and woke up every night about 1 am with recurrent nightmares of people chasing me? Or the guys who tried to renig on my three year option 18 months in? Or the S&L crisis where suddenly you couldn't borrow money at any rate and I had a balloon payment due on a land contract on a 50-unit?
Nah, I don't know any developer horror stories.
Getting municipal development approvals can take years off your life and kill a good night's sleep (in my area, these meetings are always held at night).
I was presenting subdivision plans once to the governing body and 2 of the Supervisors (well into middle age) started disagreeing with each other about something. Got louder and louder. Suddenly, both of them jumped out of their seats, raised their fists and lunged towards each other. No punches were thrown because the 3 remaining Supervisors separated them. It all happened so fast, but when you're holding your breath (as I was at the time), it seemed an eternity. Everybody calmed down and eventually, the board passed a resolution giving us conditional final approval.
Waiting for enough supervisors to make a quorum for a regular monthly meeting of the board. Not enough bodies show up, no quorum, lost a month.
Not getting the township engineer's review letter on your plans till the night of the board meeting and then dashing outside with the engineer and attorney to read it and find out if it contains any smoking guns.
But some funny things do happen. In one township, it was the custom for the municipal engineer to put the plan on a board and explain it more for the audience than the Commissioners and applicants. Bernie used a telescoping pointer. Well, this night, it wouldn't telescope despite his repeated pulling. Meanwhile, the all-male board kept up a steady stream of wisecracks about Bernie's pointer and the place was howling. All of this, of course, was being tape recorded. Finally, Bernie (red as a tomato by now) abandoned the pointer and improvised his presentation.
Expect the unexpected. Know that it ain't over till it's over. There are no slam dunks.
Quote:
On 2004-10-23 08:29, commercialking wrote:
Developer horror stories? What is this Halloween?
lol! Thanks for the laugh!
Let's see....how about my friend who purchased about 400 acres next to a growing outlying town and created a master plan for mixed use with a heavy emphasis on commercial since it was all zoned light industrial. So he buys all the land at a healthy price, spends a ton on land planning, puts in the major new parkway and associated streetscape...only to have 9/11 happen and a lot of his commercial prospects bail on him. He is still sitting on the property and has had to convert some of it to residential use at a lower price. I don't know how he sleeps at night. He will not be able to sell at the price he needs to for a long, long time.
having the subs break it off in me. their every increasing prices that is. i had to learn to control this they will price you to dealth unless you have it in writing and they will still try if you have it in writing.......km
How about going before the board in a preliminary hearing to get a feel for a future development.......you show them 5 acres your want to divide up and put up patio homes...........they say everything looks ok....................................until you buy the land......then they change their mind and you are left with 5 acres in which you can only put one house upon.
Or how about hiring a nice real estate agent to find you a large tract of land..........of course after she makes her commission she go before the board to object to the future development since it is near her posh neighborhood..................of course she still wants your listings. Yeah, right.......in a pigs eye.
One would be wise to buy stock in asprin companies..........because you will be popping them from time to time. lol
NC
But be careful which aspirin company you invest in. These days, you never know which pain reliever is going to give you a heart attack!