All Forum Posts by: Kristi Kandel
Kristi Kandel has started 49 posts and replied 357 times.
Post: North Carolina Architects
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Jeremy Levine:
Hi BP!
Getting started in multifamily new construction in the Charlotte, NC area. Any stellar architect recommendations out there? Would be great to connect!
-Jeremy
Post: Industrial Flex Space
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Brent Thomas:
Greetings y'all. I am starting my journey on industrial flex space. I am a commercial GC by trade (www.boxtconstruction.com) so I decided that I am ready to move to the development side. I am really just looking to connect with people for ideas and maybe some sort of coaching. I think my biggest struggle is finding the right dirt. There is plenty of it for sale around Houston's sub-markets, but I am overwhelmed with the search. Anyway, feel free to chime in on this topic.
Here's a checklist for how to find off-market deals. That's the best way to reduce competition and likely be one of the only people talking to the property owner. https://docs.google.com/document/d/1ZVH7Tkmk-r50jEIh5dcZJlgo...
Post: Avoiding contractor liens
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @James F.:
How do you ensure that your builder is paying the contractors so as to avoid contractors liens against your property?
You stipulate in your GC contract that the building must provide all preliminary lien waivers & releases as applicable each pay app cycle. Verify with your state on the exact lien rules but the general practice is that the only way the GC gets paid after the first pay-app cycle is that they continue to submit proof of partial payments to the subs each cycle.
That means at the start of the project you need the complete subcontractor list AND prior to issuing payments each payapp submitted by the GC needs to show the % of the total contract that the GC is billing for and the payments due and paid to subs.
Then typically at the very end of the project you would exchange the final check for the final releases.
The size and scale of the project dictate how complex this process should be to fully cover the developer.
Post: Developing Condos - Lending Questions
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Keith Schulz:
First let me start with, I'm a residential investor and have only done a few small commercial deals as an agent. I'm considering developing some condos. I've talked to a few commercial lenders and gotten a few different answers. In general commercial loans are shorter terms (3, 5, or 7 years) and often involve prepayment penalties if you pay it off or refinance early.
How would you expect financing to be handled in terms of title and prepayment penalties for a scenario like this... Let's say a full condo development is 10 million dollars so we borrow 7.5 million against the whole property for development and construction. A year down the road the development is completed and we've sold off 1/4 of the inventory. If we plop down 3-4 million on principal after a year to reduce the debt load:
1) What would you expect for a prepayment penalty each time we pay a chunk toward principal?
2) How do they handle releasing some units from the loan while maintaining a loan on the remaining units?
1. You need to start talking to lenders and you might need to talk to 10-20 of them in your market.
2. Regional banks typically know the markets the best and can give you the best rates for the construction loans and then the stabilized loan.
3. Commerical loans are completely different than residential and each lender has different loan products which is why you need to talk to a lot of different lenders.
The document below helps vet lender:
https://docs.google.com/document/d/1WavkX3gNG8T0pQuUr2EYJYH2...
Post: Life cycle of Industrial Flex space project - Managing Risk
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Rohan Bhoomkar:
Quote from @Kristi Kandel:
Quote from @Rohan Bhoomkar:
Hi , I'm Rohan. I plan to undertake an Industrial Flex space project, first timer on any real-estate project . I'm very close to putting an offer on a 3 acre land and want to understand all the aspects related to construction I need to be aware of. i have build myself a exhaustive list of all that i need to consider which tell me i need the following people to work with -
Civil Engineer, Architect, Development Project Manager, Construction Project Manager, Other consultants: noise, wind, signage, LEED, lighting, etc., Landscape Architect, General contractor
Usually how would you go about the life cycle of the project. I'm thinking this should be order
1. Find suitable Land - I have found a property that is zoned correctly around 3 acers but has a creek on it and gas line running adjacent to the property
2. Civil Engineer - to determine building codes and determine area sqft area that can be build
3. General contractor - to determine cost of building, along with site work and other foundation costs including Landscape Architect
4. Market survey to determine average rent - I already have the numbers for current market
5. do the profitability maths
6. I'm approved by the bank for a project already, so I need to present the bank with our proposal
7. work through rest of the construction life cycle with general contractor
what i'm confused with is, how do i make sure to get least number of surprises the lead bumping up to project cost significantly
(small additional cost will always be there ) - like sewer/water is on the wrong side of the street we need special contractor and additional work done, very huge storm pond is needed, etc..
can i put a contingency in the land deal so that i can get enough time to square out all such unknowns related to that specific property ?
Yes, with development you need to put clauses into your LOIs and purchase and sale agreements (PSAs) that address inspection period, feasibility period, due diligence, governmental approvals, etc.
You don't want to close on the land until at minimum you have planning/zoning approval but ideally not until you have all permits issued.
Everything in the LOIs and PSA are negotiable and you'll need a broker & RE attorney likely to help you structure the LOI and PSA terms since this is your first deal. There are many nuances to development deals that you'll need professionals on your team to avoid land mines along the way.
Thank you @Kristi Kandel, all your pointers have been just amazing and to the point. all the other research i did along the way just echoes what you mentioned. I have a learned a lot of bookish knowledge since i started researching this. By now i believe i have good comprehensive list of what i need to consider from the Civil engg, permits, estimates, approvals, testing, etc.. all the things that will take place during due diligence time. I think i have some that are MUST have and some that are good to have.
Now my next step is for me to see how i can work together with a partner ( already have one ). I will need to get in touch with an Attorney and Lender ( SBA lender that my Partner has chosen ) to make sure its feasible for me to become a 18% partner because of the SBA restriction.
we have a property identified in a well established business park ( has most utilities setup already ) that is zoned correct. already put in an offer and into the due diligence period which ends Jan 31. Closing of Before March 1. I need some advice on how do i go about investing 18%, because we are looking at an SBA loan. my Partner need help with more upfront cash. so If im able to put in that upfront value not all at once but more like go 50% in all initial and then for the SBA qualification show the rest of the amount im will to put in. because my partner is assuming all of the SBA loan risk but getting the loan against his business im open to contribute more earlier. How do we go about it, i fell first thing Monday I got to start calling Lender, Attorney and CPA. But any and all advice and pointer i can gather here by them will give me time to ruminate over it.
I know there are a lot of people very knowledgeable in here and must have already solved for this problem statement. How do i easily connect with them?
You need to be brave and start calling on lenders, CPAs, attorneys, etc. You have to talk to a lot of experts and find the ones that fit your team and your project needs. The first group you talk to will likely NOT be the group that you go with. You might need to talk to 10-20 experts in each group prior to making a decision. It starts with picking up the phone and having conversations, learning from each conversation and applying that knowledge.
Post: Estimated development cost on 100~ units (800 sq ft each) and land cost?
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Matthew Paul:
A local civil engineering firm could give you some rough numbers .
But there is no such thing as "affordable " housing .
Here is a link to what affordable housing is with the LIHTC credits that also requires gap financing and the rents are restricted for developers to secure the credits and gap funds.
The Low-Income Housing Tax Credit (LIHTC) program is the most important resource for creating affordable housing in the United States today. Created by the Tax Reform Act of 1986, the LIHTC program gives State and local LIHTC-allocating agencies the equivalent of approximately $9 billion in annual budget authority to issue tax credits for the acquisition, rehabilitation, or new construction of rental housing targeted to lower-income households.
HUD collects LIHTC data at the property level and the tenant level. HUD's property database includes information on the size, unit mix, and location of individual projects. HUD's collection of tenant information includes demographic and economic characteristics of households residing in LIHTC properties from state housing finance agencies that administer the LIHTC program. This page provides access to the property and tenant level data and also to data on Qualified Census Tracts and Difficult Development Areas designated by HUD.
Post: Estimated development cost on 100~ units (800 sq ft each) and land cost?
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Shanty Wu:
I am working on developing a 60% Area Medium Income (AMI), all affordable for a residential building. I am sorting out the number of units. I contacted a handful of developers to get development and land costs. I found some land costs but have not seen any luck with the development cost for 100~ units. Does anyone have an estimate of the development and land comps? I reached out to a handful of developers and failed to succeed. The project is located in the South Seattle Rainier Beach area in WA. I would appreciate any help. I am working on the performa and am happy to share my learning.
The costs completely depend on the market, current construction costs for multifamily, associated on and offsite work, how much land you need, etc.
For affordable housing to pencil you really need the zoning to allow for 20 units or more per acre and approx 5 acres for 100 units. That allows for 3-story garden style apartments with 20-24 units per building and surface parking.
About 9 months ago west coast multi-family pricing was in the $300 + range per SF to build 100 units (not including land, site work, soft & hard costs, etc.) which doesn't come close to penciling for affordable housing (needs to be closer to $150 / SF with gap funding OR a LOT of gap funding options in that market) unfortunately.
Ideally you have 20 units per acres with 100 units and the land costing approx 300K per acre with building costs at $150 / SF. Both the land and / SF cost are likely not feasible in WA but maybe you'll find contractors and property owners who can get close.
Post: What to do with inherited land in 29 Palms
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Maria Regis:
My husband I are about to inherit just under 10 acres of undeveloped land, 6 minutes from downtown 29 Palms. It is zoned for single family residential and my understanding is that it has city water.
We have a few long term rentals in the Southern U.S. and are about to start our first short term rental in WA but, we have no experience with development. I have read the city's vacation rental policy so it seems that short term rentals with this location are not an option (correct me if I'm wrong).
What is the best course of action with this property in terms investment. Should we sell it as a whole? Split it into individual plots, if so how long does this process take in San Bernardino county? Should we develop it?
Anyone with experience in the area that could provide some advice would be greatly appreciated!
Hey Maria! I've been a developer the past 17 years with a majority of that work in CA and I'm pretty sure we put a Family Dollar in 29 Palms. That being said development requires stamina as the development process takes 2-3 years minimum and for 10 acres depending on the development you'd move forward with could take more like 3-8 years.
I'm happy to jump on a call with you next week to discuss your property and see what your options might be based on the location and zoning. Right now SFH new construction is very tough to pencil in a lot of markets and you'd need higher density per acre to make something work. However, if the city is on board with more affordable housing then maybe a rezone isn't a stretch for the land.
Real estate developers need to identify the highest & best use for a piece of land or property, then gather the team & resources necessary to complete the project. They use educated assumptions based on personal & partner experience to predict the revenue/income the development will generate.
Development projects take years to complete and real estate developers should have expertise or strategic partners) in the following areas:
- Building and maintaining relationships
- Land acquisition
- Market studies
- Approvals and permits
- Project financing and financial analysis
- Building development
- Building renovations
Post: Life cycle of Industrial Flex space project - Managing Risk
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Rohan Bhoomkar:
Hi , I'm Rohan. I plan to undertake an Industrial Flex space project, first timer on any real-estate project . I'm very close to putting an offer on a 3 acre land and want to understand all the aspects related to construction I need to be aware of. i have build myself a exhaustive list of all that i need to consider which tell me i need the following people to work with -
Civil Engineer, Architect, Development Project Manager, Construction Project Manager, Other consultants: noise, wind, signage, LEED, lighting, etc., Landscape Architect, General contractor
Usually how would you go about the life cycle of the project. I'm thinking this should be order
1. Find suitable Land - I have found a property that is zoned correctly around 3 acers but has a creek on it and gas line running adjacent to the property
2. Civil Engineer - to determine building codes and determine area sqft area that can be build
3. General contractor - to determine cost of building, along with site work and other foundation costs including Landscape Architect
4. Market survey to determine average rent - I already have the numbers for current market
5. do the profitability maths
6. I'm approved by the bank for a project already, so I need to present the bank with our proposal
7. work through rest of the construction life cycle with general contractor
what i'm confused with is, how do i make sure to get least number of surprises the lead bumping up to project cost significantly
(small additional cost will always be there ) - like sewer/water is on the wrong side of the street we need special contractor and additional work done, very huge storm pond is needed, etc..
can i put a contingency in the land deal so that i can get enough time to square out all such unknowns related to that specific property ?
Yes, with development you need to put clauses into your LOIs and purchase and sale agreements (PSAs) that address inspection period, feasibility period, due diligence, governmental approvals, etc.
You don't want to close on the land until at minimum you have planning/zoning approval but ideally not until you have all permits issued.
Everything in the LOIs and PSA are negotiable and you'll need a broker & RE attorney likely to help you structure the LOI and PSA terms since this is your first deal. There are many nuances to development deals that you'll need professionals on your team to avoid land mines along the way.
Post: Pool Safety Measures for My Airbnb Rental in Escondido, CA
- Developer
- Fort Myers Beach, FL
- Posts 380
- Votes 195
Quote from @Manjusha Tangirala:
Dear Bigger Pockets Community,
I hope this message finds you well. I'm reaching out to the knowledgeable and experienced community here at Bigger Pockets for some guidance regarding my short-term rental property in Escondido, California, which I have listed on Airbnb.
One of the unique features of my property is a spacious 9ft deep, 35,000-gallon pool. While this amenity enhances the guest experience, it also comes with a significant responsibility to ensure guest safety and minimize any potential risks or liabilities.
I'm interested in learning from your collective expertise about what signages, safety measures, and precautions I should put in place to provide a safe and enjoyable pool experience for my guests. Specifically, I'm curious about:
- Pool Signage: Are there specific signs I should place around the pool area to inform guests of safety rules and guidelines?
- Safety Measures: What are some essential safety measures I should consider implementing, such as pool alarms or fencing?
- Liability Waivers: Do you recommend having guests sign a liability waiver related to pool usage? If so, what should it include, and how should it be presented to guests?
- Other Rental Agreements: In addition to standard rental agreements, are there any other specific agreements or contracts that I should have my guests sign to address pool usage and safety?
I understand the importance of ensuring the safety of my guests and protecting myself from potential legal issues, and I greatly appreciate any insights or advice you can provide on this matter.
Your expertise in real estate and property management is highly valued, and I look forward to hearing from you. Thank you in advance for sharing your knowledge and helping me create a safe and enjoyable experience for my Airbnb guests.
Thanks in Advance
I just finished building a pool that will be used by STR guests when I go to the mountains each winter.
1. fencing is around the entire property with gaps no larger than 4"
2. each gate has hardware above 56" and the gates swing out from the pool so a kid can't accidentally work the hardware and get into the pool area.
3. we flipped the screen doors to open INTO the house areas and raised the hardware above 56"
4. we will add a baby gate at the bottom of the stairs from the house to the pool since the screen door at the top of the stairs has a dog door that a kid could crawl out of.
5. make sure your liability insurance covers the pool and guests on your STR home policy
You can't plan for every possible outcome but as long as you have every code required safety mechanism in place and you're covered by insurance you do mitigate your risk.