• Are you using umbrella policies, specialty endorsements, or standalone environmental policies?

Great topic — ground-up projects can produce strong margins, but execution risk is where many investors get caught off guard.From the builder/developer side, the biggest challenges we consistently see are:1️⃣ Site Work UnknownsFill, compaction, drainage, and soil conditions can shift budgets quickly — especially in markets where lot conditions vary significantly.2️⃣ Utilities & Impact FeesWater/sewer access, well/septic requirements, and local impact fees are often underestimated during underwriting.3️⃣ Environmental FactorsProtected species, wetlands, and flood elevation requirements can affect both timelines and build costs.4️⃣ Permit TimelinesApproval periods — particularly when civil or environmental reviews are involved — can extend holding costs beyond initial projections.5️⃣ Builder Execution CapacityProject success often comes down to the operator’s systems, trade relationships, and cycle times — not just the numbers on paper.Because of these hurdles, we’re seeing more investors lean toward ready-to-build projects — where feasibility, plans, and permitting are already in progress or completed — as a way to reduce entitlement risk and shorten timelines.Ground-up can be extremely rewarding, but the upfront diligence and execution planning are what ultimately determine outcomes.Always happy to compare notes with other investors and builders working through similar projects.

This is why many experienced investors in cities with old housing stock (I am in Philadelphia) intentionally buy property that requires full gut rehab - to change out all of the systems and structural elements and remove most of the need for ongoing expensive maintenance. 

The asset itself doesn’t really change much year to year.Campgrounds feel almost inverted.A lot of the risk is front-loaded and structural: zoning, environmental constraints, infrastructure costs, layout decisions, access, utilities, and seasonality.

Problem was that there was environmental concerns, with estimates of costs to cure ranging from $60,000 on up.  

I don't think anything has changed. 1) Ensure the borrower has the ability and exit strategy to pay the loan back, 2) Ensure the borrower has a history of paying their bills (we pull credit), and 3) We pay attention to not only the LTV and not overleverage, but we make sure there aren't any significant defects in the collateral (environmental issues, settlement issues, title issues, etc).

I think so many things in my life I "fear" or "avoid" simply because there is an element of unknown there, and that very quickly gets into a "failure" type space mentally for me. 

You generally need permits when you’re touching:Electrical - i.e New breaker box panelsPlumbing - i.e removing cast iron pipes and replacing with PVCHVACStructural elements (walls, beams, load‑bearing anything)Roof workAdding square footage - i.e addition to the home or conversionAnything that changes the home’s layout or safety profileThose items can impact insurance, inspections, and liability, so pulling permits protects you long‑term.Cosmetic work usually doesn’t require permits, like:PaintFlooringCabinetsFixturesTrimAppliances (unless rewiring or re‑plumbing is needed)Another thing to factor in is your exit strategy.

- How does environmental differ?

Here's a https://www.irs.gov/businesses/cost-segregation-audit-technique-guide-chapter-4-principal-elements-of-a-quality-cost-segregation-study-and-report to the IRS website noting specific items that are included in the cost segregation study report. hmm, that website is a 404 error.