All Forum Posts by: David A.

Glad its been helpful. ADUs get a lot of buzz, but the process always seemed like black box. I'm pushing through the fog myself and if it goes well hoping to keep repeating the process at my other properties. Here's was my timeline leading up to breaking ground:

• September 2019 - purchased the property, pre-leased it before I could even close. The rent on the existing home covered the PITI making the unused part of the lot "free". I knew I wanted to add an ADU but the laws in 2019 were restrictive to say the least and would have required the property to be owner-occupied and wouldn't have let me build more than ~400 square feet. The upcoming 2020 ADU laws swung the other way and I read them word for word and got to re-learn how bills become laws.
• Oct 2019 - Had an initial site visit and had a feasibility study done by some fly by night, over promise, under deliver "ADU consultants". Parted ways and went back to the drawing board. Probably my biggest reason why I want to share as much I can.
• Nov 2019 - asked friends for recommendations of architects. Spoke to a few, began working with a designer / architect who did an addition for a friend. 
• March 2020 - Decided on design /floor plan
  
• --- Corona virus uncertainty pause ---
• Jan 2021 - Picked things up again, engaged the engineer
• Feb 2021 - Submitted the plans to the city planner for the preliminary review. No go, not even close. Turns out the city failed to mention a bunch of limitations during our initial discussions that came from the neighborhood specific plan from 29 years ago that directly conflicted with the state-wide ADU laws and current municipal code. They also weren't very forthcoming about the "mandatory approval" avenue that overrides the limitations in the specific plan that was also hidden deep in the municipal code. After some tense discussions with the planner and questioning if I had the stomach for this, we ended up having to drop 20% of the square footage to meet the "mandatory approval" requirements. This wasn't easy because we were already squeezing a lot in but still better than the first answer we got of no-way, no-how. This planner left the city shortly after, so I'm guessing she was already checked-out and jumping up and down to start anything in her last few days. Other than this one experience, everyone at the city was very helpful.
• Mar 2021 - resubmitted for preliminary review and received a preliminary approval, submitted printed plans to get the official planning department approval
• April 2021 - planning department approval and submitted printed plans to building & safety department for plan check. The city outsources plan check to a 3rd party and they have a min 10 day turn around. They only pick-up plans from the city twice a week so this can add some days if you miss a pick-up date.
• May 2021 - plan check corrections dropped off at the city, I picked these up and scanned / took pictures of comments to send them out to the architect and engineer 
• early June 2021 - resubmitted corrected plans for plan check. Engineers get busy. 
• mid June 2021 - The plan checker had one remaining comment that was raised with less than an hour until he had to return the plan set to the city. The engineer saved the day by addressing the comment in record time by emailing a stamped / signed letter and saving us from having to re-print / re-submit and wait another 10 days. Plans are approved, remaining city fees are paid and permits are issued. We broke ground same week.     

Great point, I hadn't even had a chance to process that. When you add in the printing costs, since the city likes to do things the old fashioned way, it was more than then the 3 skilled, experienced and licensed professionals combined. My city fees were also on the low end of the spectrum since square footage / project cost directly impacts these amounts and I was definitely building small and lean. I definitely feel like I found my project size sweet spot, real estate development in beginner mode. In the city’s defense, they were pretty easy to work with and moved things along pretty quickly. 
 

 I hope so too! Entire build was going to be 3 months so this could potentially double the timeline. I'll be happy if its done in 6 months, but not ruling out it taking 12. Without a roof, we can't get a head start on the work inside either. Once we have a date to move the service line I can start reforecasting the timeline but as of now a lot of the next steps are on pause:

I think I really lucked out here, my contractor was a word of mouth recommendation who does 0 advertising and tends to work with larger developers. I made a point of letting people know I was looking for a contractor for a new build and that I was happy to pay a finders fee for the right one.

I can't say exactly since I never considered a slab. Engineering seemed to be somewhat of a flat fee so didn't see any uptick in cost there. Material wise, and I'm guessing here, the lumber for the floor joists and plywood(with the inflated prices) probably cost more than the concrete for a slab. Labor wise, my GC does the framing himself with his own crew where I believe the concrete work is subbed out so this could offset the higher material cost.    

I'm working on adding a ADU now and when I looked into any of the construction loan products they where more of a headache than I was willing to deal with. I don't do garage conversion ADUs, only detached new ADU builds, so your returns may be different but even with the worst financing terms this strategy still made sense for me. I would take your build cost estimate, double it, and then compare it against your worst case monthly rent scenario and see if the returns warrant considering more non-conventional financing (100% LTV HELOC, personal loan, borrow from your 401k, hard money). You will need the full amount ready to go up front because you'll be burning through checks once you start.

Progress pics and city inspections passed to date (continued):

Floor framing and insulation complete (both passed inspection)

Floor sheathing complete, pending nailing inspection.

Walls getting stood up next week, as well as excavation for the upgraded gas line (to feed the additional gas meter) and excavation for the new water line to the ADU.

First timeline snag: The existing power line to the main home is (and possibly the neighbor's power line) are in the way of framing the roof. Power company was out to assess how to proceed but warned us they were potentially behind up to 3 months on requests to move service lines.   

Thanks, I'm looking to standardize this and repeat the same design / layout at my other properties that have very similar lots (small house upfront, big lot I can split up with alley access). I'm in the process of permitting the next one now, trying to stay one step ahead of my contractor.      

I'm anticipating some where between $2400 (on the low end, get this thing rented tomorrow) and $2700 (on the high end, this location has very few rentals and is one block away from the university & downtown area). The ADU is separately metered for the various utilities, but because CA law requires it be net-zero energy usage via a solar system I may include the monthly solar lease (>~$100 per month) in the rent. Its on the smaller side and may be less desirable since its a back-house but it will be brand new with all the amenities (d/w, laundry, AC) and will have its own completely separate yard and entrance off the alley. I already have someone interested in it so we'll see where things are once its completed.

Progress pics and city inspections passed to date:

Lot cleared of vegetation with existing rental property in the background. Existing property is a remodeled 1920s 2 bed/1 bath ~900 sq ft home on a large lot with alley access. Fence was put up to split the lot prior to the tenant in the front house moving in. ADU was designed to fit around the mature avocado tree which produces lots of massive "fuerte" avocados that I like to share with the neighbors as a small token of my appreciation for "keeping an eye" on my properties.

Foundation footing concrete forms and underground plumbing completed, passed set-back, footing, hardware and underground plumbing pressure test inspections and got the OK to pour concrete.  I actually got a call from the city inspector to let me know how great everything was looking and that my contractor was doing a bang up job. 

Foundation poured and framing began. I opted for a raised foundation (vs. slab on grade) to make future repair / maintenance down the line easier.