All Forum Posts by: Canesha Edwards

@Said Aliyev

Hey Said-

What exactly are you looking to find out?

I can better help if I know what you’re specifically doing anting to know.

General information.

1. Make sure the property is zoned for what you desire to build. Rezoning can be a pain.

2. Talk to your planning and zoning department to understand the process steps to entitlement.

3. Make sure utilities are on the property or very close by. It’s gets expensive when you have to run utilities if a connection is not close by.

4. Conduct your market studies ahead of time and have a solid grasp on your numbers rent/sales price. Always air more on the conservative side here.

5. Never purchase land until you have received all entitlements.

6. Make sure you have enough capital to cover the cost of entitlements.

Hope this helps. Feel free to reach out any time if you have more questions.

Best,

Canesha

@Matt Nico

@Matt Nico

Hey Matt-

I actually started my development company to solve this very issue. Here’s my input.

I have 2 lots under contract which I was hoping to develop 4 townhomes and then continue buying the other vacant lots on the block to continue building. I assumed that since there are several habitat for humanity homes on the street, my 4 affordable townhouse development would fit right in. Well the city denied my proposal and only agreed to 3 townhomes at a min of 26’ wide lots. This would put the homes over 2000sqft and to turn a profit I would have to make them luxury homes to make the numbers work.

Tip #1- Make sure the plans the city has for the area aligns with what you want to develop. It will save you a lot of time any money.

The other main issue with building affordable is the cost which has already been mentioned.

There are tax credits given to developers and investors of affordable housing. Every state receives these credits but it’s extremely competitive and larger projects typically win out.

Secondly- You will not be able to compete with larger developers when it comes to cost of development. Larger developers have economies of scale and get better pricing on materials, professional services, etc.

So, smaller developers have to be more creative.

One thing you may think about is tiny homes. These are great for the elderly, young professionals, newly weds. Check with your planning and zoning to see if these are allowable in your area.

Maybe you can find a local contractor who will do the work in exchange for equity in the project. This way you only have material cost and some cost for sub contractors.

Also, a lot of developers ask for a reduction in impact fees for providing affordable units.

Check out your local community development office see what grants or incentives are available.

Low-income tax credits are also an option.

Feel free to reach out with any questions.

Hope this helps.

Canesha

@Cameron Riley

Hey Cameron-

Just because the property is in the hood doesn’t mean you can’t find decent tenants. I suggest looking at the Section- 8 tenant requirements and building your criteria from there.

Honestly- I would try to market the properties specifically for Sec-8 tenants. Many Sec- 8 tenants value their voucher and are good tenants for fear of losing the benefits and do not mind living in the hood.

Also consider

- eviction history

- ask for previous landlord references.

- income verification/job history

Hope this helps.

Happy Investing.

Canesha

@Aidan Sorenson

Hey Aidan-

Try driving for dollars. Searching through the property records for your county or city for out of state owners. Look through tax records for properties with unpaid taxes.

Once you have a good list. Skip trace the owners and one thing I do is send hand written letters. It takes time but property owners are drawn to open a hand addressed letter. Especially- older owners.

Hope this helps.

Happy Investing!

Canesha

@Floyd Bonner

Hello Floyd-

Nice to meet you. I current live in College Park, which is between East Point and Union City.

As far as the market- East Point is a little more mature and higher priced than Union City. There is Woodward Academy which is a great private school in East Point. There is also new construction of apartment homes, Tyler Perry’s new studio is in the area, there’s a lot happening in the area.

Union City is has not gained as much interest as the other areas but the area is slowly changing. The city welcomes development but the interest from investors has not picked up. School systems in Union City aren’t the best- but the administration knows this and is working to turn things around.

However- as the city of Atlanta continues to become more expensive...people are starting to look to other cities. It’s only a matter of time before investors start looking in these areas. Getting in now would be smart.

Like I said I live between both areas so feel free to reach out anytime with any questions.

Best,

Canesha

@Doug Trumbull

Hey Doug-

Here’s my input. First, I’m not an attorney and this is not legal advice.

From what I know.....unless you are forming the LLC to raise money under SEC regs.....I am not aware of any equity limitations for partners for formation of a regular LLC.

I would make sure to clearly define the equity percentage and the expected responsibilities to be performed by each partner.

Hope this helps.

Best,

Canesha

@Josh Randolph

Hey Josh-

Are you looking to sell the land to a developer? Or hire someone to develop it for you?

My advice on finding developers. Go online to your city planning department and look through project submittals. These documents will let you know who the developer is, what type of projects, etc. Reach out- and see if they would be interested in what you’re offering. This information is readily available in GA, don’t know much about AL. You could always call the planning department to see where they keep this information.

Hope this helps.

Canesha

@Jennifer Kris

Hey Jennifer- I don’t think there is a one size fits all approach.

Why does the seller want an adjustable rate? What was the original rate offered? You could always increase the interest rate if it won’t kill your deal.

Honestly- I think what you offered was fine. 20% down on a seller financing deal is high in my opinion.

Is the property worth full asking price? If the numbers don’t work , don’t agree. If the deal still works at full asking....I would try to negotiate a lower down payment if you agree to full asking price.

Get creative. Things will workout.

Best,Canesha

@Haseeb M.

I know a few investors taking this approach. Their strategy is to identify newly built or updated hotels where most of the units are set up as suits. The plan is to hopefully assume the loan and convert the hotel into apartments.

I don’t see corporate travel returning to 100% percent and this will have an impact of the hospitality industry. It’s honestly a lot cheaper for corporations to keep employees at home.

I do think leisure travel will see a spike once people are allowed to live around freely again. But I don’t think levels will stay elevated.

There are some good deals out there for sure if you have the capital to take advantage.

Just my 2 cents.

Canesha

@Charles Scott

Hey Charles. As someone who is currently developing their first ground up project....here’s my advice.

My first attempt at development in 2017 was a failure! I lost $30k. How did this happen? I was uneducated and trusted control of the project to someone else. Don’t be like me.

However- you do not need a mentor? No. This is what I thought and wasted a lot of time trying to find someone to show me the ropes, Before I actually took steps to start on my current project. So, here’s what you need to do.

1. Get educated. Pick a market and learn everything possible. Does the city welcome develop? What current projects are going on? Read the comprehension plan. What does the community want/need?

Is population increasing or decreasing? Wages? Are jobs being created or are companies leaving the area?

Then study the technicals. Zoning ordinances, land use designations, etc. You can typically find all of a city’s development information online. I even read through project denials and the reasoning behind the denial.

Call your city planner and have a conversation. This is the best way to get direct information. I typically use a property I’m considering buying and ask questions around what I would like to develop.

Ex. I’m considering buying 123 ABC St to develop 50units. I believe this falls within the current zoning. Can you confirm? Are there any overlays or restrictions I should be aware of?

2. Talk to lenders early. Even if you don’t have a deal. Build relationships. Find out if the bank has an appetite for this sort of thing. What are their terms? This will help you gauge your financial situation. Don’t get in over you head trying to develop outside of your financial range. Development is expensive and some times have high upfront cost. Make sure you have enough saved to at least cover your soft cost ( plans, permits, engineering fees, survey, etc).

3. Hire Experienced Professionals. This is important, especially starting out. Spend time and actually interview your team before hiring.

Let me clarify that development is by no means easy or a simple task. But I am a firm believer that you can accomplish anything you truly set your mind to. With or without the help of others.

Take the time to really learn the craft of development and you will be fine. Knowledge is key.

I hope this helps to get you started in the right direction. Reach out any time, always happy to help.

Best,

Canesha