Help, should I do a Land division in NE Portland as a newbie

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Help, should I do a Land division in NE Portland as a newbie

Kevin Asgharian
Portland, OR · Member since 2017 · 14 posts · 3 votes

Hi, Looking for help/insight on Land division in NE PDX.  Let me know your thoughts and experience please!

I was looking at a property with an existing home that could easily have a flag lot behind it (link below).  Since I haven't done this before, I was curious what everyone's experience is with the City of Portland and if you would recommend it to someone looking at their first deal.  I've heard in general the city is difficult, frustrating and slow.   The land division process seems straight forward (link also below).

Property in Question

City of Portland Land Division process

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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
9y

you may want to hire a company to do this for you  ... city is frustrating ... although I just did a PLA merging 4 lots and creating 3.. and I was able to do that myself.. took 5 seperate trips and a year to the city.

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    you may want to hire a company to do this for you  ... city is frustrating ... although I just did a PLA merging 4 lots and creating 3.. and I was able to do that myself.. took 5 seperate trips and a year to the city.

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
    2Reply
  • Kevin Asgharian
    OP
    Portland, OR · Member since 2017 · 14 posts · 3 votes
    9y

    I was thinking 2 trips and 3 months at the worst.  Thank you for putting it in perspective, Jay.   

    @Jay Hinrichs

    1Reply
  • Randy Johnston
    Residential Real Estate Broker · Beaverton, OR · Member since 2014 · 335 posts · 149 votes
    9y

    I would suggest that you schedule an early assistance meeting with the city to ensure that it's feasible. I also suggest that you take @Jay Hinrichs advice about hiring a civil engineering firm to work with the city, there will be a lot of hoops to jump through and a good firm will help immensely. 

    Just my opinion, but the asking price seems close to or even above the ARV and that's before the land partition, the value will go down with another home on the lot. The land value, after you complete the development (build ready), would be in the $150k to $225k range.

    2Reply
  • Lincoln Herman
    Real Estate Agent · Portland, OR · Member since 2014 · 1 post · 1 vote
    9y

    Yes, a pre-app will help tremendously.  Your proposal may not be viable under City code depending on a number of factors.  Also, they will define other requirements that could  dramatically effect your pro-forma.  I have completed several in the City and have currently taken control of a land division that has been wiling along for about 2 years now to push it across the finish line.

    1Reply
  • Brian Bradley
    Attorney · Wilsonville, OR · Member since 2017 · 504 posts · 411 votes
    8y

    I would hire, or at least consult with, an attorney and a civil engineering firm. Your land division application is going to take lots of detail. I am a strong believer that an investors job is to find the deals, and then have their team manage the details. You will have to have review and approval of your preliminary plan, review and approval of final plat. Each stage will have a lot of detail that will need to be done correctly the first time for your project to not be delayed. Best of luck. 

    0Reply
  • Chris Shepard
    Investor · Portland, OR · Member since 2012 · 163 posts · 121 votes
    8y

    I have a reverse flag lot that I am still working on that we submitted in 2014.  We are just about to finalize it. From encroachments on neighboring properties to angry neighbors at the neighborhood association meeting and the neighborhood association voting against our lot split, we are still going to get it done.  It’s just taken a very long time.  If this was my first deal, I’m just not sure how long I would have made it. 

    This is a worst case scenario though. 

    If I was starting over, I would buy a 4 plex with 5% down Owner occupied financing and fix up each unit, raise rents, get a HELOC, and then buy another with 20% down and do it again.

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y

    @Chris Shepard  unfortunately    "the city that CAN"  simply cannot anymore.

    I have 3 houses going vertical on Ivy and MLK area and that only took 3 years and 60k.

    its crazy.. along with builders are really apprehensive of working in the city anymore.

    will be my last city of portland project.. simply easier places to build..

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
    1Reply
  • Karen MargraveBusiness Member
    Moderator
    Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
    8y

    First off you need to meet with a Civil Engineer, that has experience getting things through the City, and determine what all the costs involved will be, along with the timeframes. THEN, you will need to decide if gaining one lot on which to build is worth the time and costs involved.  Is the land in a high end subdivision where the costs, and end value will justify the time and costs involved in splitting and developing, or would you make as much by developing one lot, selling and moving on to the next project? The devil is in the details, and we don't have enough of them to really advise you. 

    1Reply
  • John Jacobus
    Investor · New York, NY · Member since 2016 · 224 posts · 333 votes
    6y

    I have a 100’ x 60’ lot in Belmont, zoned R2.5, that I’m planning to divide into 2 separate 50’ x 60’ lots. The north end of the lot has a home on it and I plan to build a new home on the newly created southern lot. There are at least two carbon copy examples in the neighborhood and this seems to be a low complexity project.

    Can anyone here recommend a surveyor and/or engineering firm who can guide me through the land division process, create the new plat plan and help sort though the possible need for a new retaining wall on the south end of the lot?

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