All Forum Posts by: Daniel Chun

I client of mine is looking into a plot of land to develop in Brooklyn.  Here are the stats:

Max residential FAR 2.43

Max facility FAR 4.8

Lot size: 2853 sf

Max residential buildable sf: 6933 sf

Max facility buildable sf: 13,694 sf

Primary zoning: R6 Commercial Overlay: C2-3

QUESTION: By building a community facility you can almost double the sf buildable.  How do you model the community facility component when underwriting the development?

• Let's say residential comps are $1000 psf, the sellout for just residential is $6,933,000.
• But if we build a community facility to get the bonus sf (additional 6761 sf), what would the price be per sf of that community facility?  And how much of that bonus 6761 must be used for the community facility?

Really appreciate any guidance you folks may have!

@Brian Eastman Just want to reengage on this thread.  Are you sure you can leverage to purchase real estate with a solo 401k?  I think I've heard otherwise but am not sure.  For instance, if I have $50,000 in my solo 401k and want to purchase a property worth $200,000, can my solo 401k get a mortgage to purchase the property?

It depends on what your goals are (i.e., build wealth through appreciation or build portfolio of cash flow properties), but I second Bill's comments. It's tax-free gain now (or for another 3 years from when you move out, assuming you've lived there for at least 2 years straight). NYC is great for appreciation and you've realized a lot of it having purchased in 2012, so take the tax-free gain and expand in your next market.  Or if you don't need the capital to start investing in your new market, than you can rent it for a year or two and reevaluate then.  NYC is generally not where you want to invest for cash flow as cap rates are much lower than in other markets.