small developer training
TRANSCRIPT
D‐TAP 101Small
DeveloperTraining
Course InstructorsAndy BabulaVarro Real Estate
Joe BowmanConscious Living Institute
Sara Joy ProppeSchafer Richardson
SECTION 1
Purpose of Course
Purpose of Course
SECTION 2
Introduction
Development Process
Site Selection & Opportunity Identification
Acquisition, Due Diligence, & Entitlements
Financial Feasibility Financing
Design & Construction
Lease Up & Property
Management
Skills Needed at Each Stage of Development
Site Selection & Opportunity Identification
Acquisition, Due Diligence, & Entitlements
Financial Feasibility Financing
Design & Construction
Lease Up & Property
Management
Partnerships
• Real estate broker• Attorney• Architect• Engineers• General Contractor
• Market Analyst• Financial Partners• Financial Analyst• Property Manager
Activity A:
Small Developer Skills Inventory
Your Business Model
Buy Build
Hold Flip
Residential Commercial
Internal External
Build‐to‐Suit Speculation
Financing
Acquisition
Term
Asset
Tenant
Geography
Where Do You Start?
Activity B:
My Small Development Business Concept
Small Group Discussion
SECTION 3
Site Selection &Opportunity Identification
Build Your Inventory Comparison
Build Your Inventory Comparison
What to Consider When Selecting a Site
• Basic Specifications (Size, Age, Parking, etc.)• Zoning• Plans• Price• Market Potential• Existing Tenants• Property Conditions• Availability• Relationships!
Basic SpecificationsWhat is buildable land?
www.spb‐inc.com
Stair192 SF
Tenant 1 Tenant 32592 SF 2400 SF
Elevator72 SF
108'Mech25 SF
Stair216 SF
180'
Tenant 2
Tenant 5Tenant 45772 SF3107 SF
3384 SF
Kitchen/Lounge600 SF
Gross vs. Rentable vs. Usable Square FootageBasic Specifications
Finding Basic Site SpecificationsHennepin County
Finding Basic Site SpecificationsCity of Minneapolis
Understanding Zoning Maps
www.planning.orgwww1.nyc.gov
Zoning Code Terms
Plans, Plans, & More PlansComprehensive PlansSmall Area PlansNeighborhood Plans
Market PotentialTraffic Volume – Visibility – Accessibility
Resources for Site SelectionBroker Sites
http://www.mncar.org/public‐commercial‐listing/
http://www.loopnet.com/
http://www.themlsonline.com/minnesota‐real‐estate
Resources for Site Selection
Minneapolis Property Information
http://www.ci.minneapolis.mn.us/propertyinfo/index.htm
Minneapolis Planning and Zoning
http://www.minneapolismn.gov/cped/planning/index.htm
Minneapolis Sector Liaisons
http://www.minneapolismn.gov/cped/cped_about
Minneapolis Resources
Minneapolis Communities and Neighborhoods
http://www.mncompass.org/profiles/neighborhoods/minneapolis‐saint‐paul#!community‐areas
http://www.minneapolismn.gov/residents/neighborhoods/index.htm
http://www.ci.minneapolis.mn.us/neighborhoods/
Resources for Site SelectionHennepin County Property Information
http://www.hennepin.us/residents/property/property‐information‐search
Resources for Site SelectionTraffic Counts
http://minneapolis.ms2soft.com/tcds/tsearch.asp?loc=Minneapolis&mod
http://dotapp9.dot.state.mn.us/tfa/
Activity C:
Site Selection Questionnaire
SECTION 4
Acquisition, Due Diligence, & Entitlements
Acquisition Process
Letter of Intent
Purchase Agreement
Due Diligence Closing
Letter of Intent
PropertyPriceTiming
Contingencies
Non‐Binding
How Long “Under Contract”
All Cash/Quick Close
No money goes “hard” until all Due Diligence is complete and tenants lined up
“Free look” period
Paid extension(s)
Due Diligence Checklist
Buying Financing Appraisal Taxes & Assessments Financial Review
Managing Tenant Review Property Management Review
Owning Title Survey Environmental Inspections
Using Zoning/Use Licenses & Permits
Phase I & Phase II Environmental
Phase IIPhase I
• Property Records
• History of Uses
• Photographs
• Surveys
• Maps
• Records of nearby properties
• Soil samples
• Water samples
• Vapor samples
• Surveys for underground storage tanks
• Sampling of drums on site
• Testing of underground tanks
Zoning & Buildable Potential
Minimum Dimensions
Setbacks (Yard Requirements)
Lot Coverage
Floor Area Ratio
Height Limits
Parking
R3 – Multiple Family District
Uses Minimum Lot Area
(Square Feet)
Minimum Lot Width (Feet)
Maximum Floor Area
Ratio (Multiplier)
Maximum Height
RESIDENTIAL USES
Dwellings
Single‐ or two‐family dwelling
5,000 40 0.5 or 2,500 sq. ft. of GFA per unit,
whichever is greater
2.5 stories, not to exceed 28 ft. The highest point of the
roof of a single‐ or two‐family dwelling with a gable, hip, or gambrel roof shall not exceed
33 feet.
Cluster development 5,000 or 1,250 sq. ft. per dwelling unit, whichever is
greater 40 1.5
2.5 stories, not to exceed 35 ft.
Multiple‐family dwelling 5,000 or 1,250 sq. ft. per dwelling unit, whichever is
greater 40 1.5 4 stories, not to exceed 56 ft.
Planned unit development 1 acre or 1,250 sq. ft. per dwelling unit, whichever is
greater As approved by C.U.P. 1.5 4 stories, not to exceed 56 ft.
Zoning & Buildable Potential ‐ FAR
Floor Area Ratio (FAR)1:1 Ratio
1 story(100% lot coverage)
2 stories(50% lot coverage)
4 stories(25% lot coverage)
Entitlements
Entitlements
Administrative Planning Commission City Council
Entitlements – City of Minneapolis
Permit
Permit Application
Administrative Site Plan Review
Development Coordinator
“Small” 1‐4 DUs, <1k SF
“Large”
Non‐Admin Site Plan Review
Neighborhood meeting(s)
Heritage Preservation Commission*(If needed)
Planning Commission*
City Council(Appeals, Rezoning, Vacating public right of way)
Planning Committee of the
Whole
Preliminary Development
Review
Administrative Approval
Resubmission Required
Construction Plan Review
PDR Approval
PDR Resubmission Required
Optional
* Requires public hearingNOTE: Variance requests not requiring planning review go to the Zoning Board of Adjustment
Activity D:
Zoning Research
SECTION 5
Design & Construction
Do It Yourself v. Hiring Expertise
• Key Partners• Architect• Civil Engineer• General Contractor
Principles of Good Design
• Repeatable• Flexible• Cost‐Effective
The Missing Middle
Accessible Design
Design Process
SchematicDesign
DesignDevelopment
ConstructionDrawings
Evaluating a Building
• Roof• Insulation• Foundation and structure• Mechanical systems• Electrical systems• Plumbing• Doors and windows
Contracts
• Scope• Schedule• Budget• Terms of Payment• Insurance and Bonding• Liens
Scope of Work
• Work performed• Major fixed equipment• Fixtures and finishes• Permits
Budgeting
• Lump Sum Contract• Unit Price Contract• Cost Plus• Guaranteed Maximum• Incentives/Fees at risk
Wrap Upand
Final Questions