Hoe Does Commercial Multifamily New Build Makes Business Sense?

[Manik Zaman]

I been in buy and hold for a while in Massachusetts. Commercial multi-family is mostly what I have done. 

I was researching with the idea of whether to go into new construction instead of purchasing existing buildings. Idea is to buy buildable lands and build 20-50 units on it. Construction cost numbers that I see online are bit scary. I get the notion of 150-250 per square foot on expenses.

I am trying to make a business sense of the build cost. With 150-250 per square foot cost, we get to around 5-6 million to build a 20 unit building, this will never work as a business.

What am I missing really? How does other people make money doing this really? Appreciate any pointers and knowledge share.