Full Gut job vs New Construction, Philadelphia Pa

[Dae Sandridge]

I just came across a deal that I’m contemplating and I’m torn between doing a full gut Reno or New Construction. I’ve only done two flips so new construction seems a bit aggressive. However, the subject property block has a lot of new construction. Has anyone been in this position? If so what were some of the deciding factors that influenced your final decision? Thanks in advance! Dae S.

[Jeffrey Stasz]

@Dae Sandridge New Construction is the way to go. It is more intimidating but actually easier then a full gut especially if the subject property is older then 50yrs.  

As a bit of background I am a developer AND a builder specializing in historic restoration and new construction urban infill. My new construction stuff is always much less of a headache. 

I could go over the specific reasons why this is true and I have in multiple posts elsewhere in the forums. If you'd like to read those feel free, or you can DM me and we can get on the phone if you're super interested/nervous. 

To keep the forums fresh let me offer you a few rules of thumb to help your new build go right: 

1. Be honest about your experience level with the core members of your team. Just tell your architect and your GC that this is your first rodeo and you will need some hand holding. You'll know you have the right team when they are excited to work with you and help you learn the business.  

2. Related to number 1: When bidding out the job you'll want to start with the architect and then interview the builders they recommend. New construction is a team sport and the folks who play in the space have squads they consistently work with. The architect/builder relationship is important and can take a long time to cultivate. It will be tempting to mix and match. Don't. While it is possible that Tom Brady and Bill Belichick would have be equally successful apart as they have been together I'm not sure I'd want to bet 500K to find out. 

3. Find a builder you can fight with. You will be married to this person for 6-18 months and it is going to be overwhelming, expensive and stressful. At some point, you'll have an argument. It's important to be able to fight with this person without doing permanent damage to the relationship. 

4. Sweat every detail and enjoy the ride. The first new build is really really special, you will quickly learn how little you actually know but you will also learn more then you can imagine. 

Good luck.