Building new multi family units

[Patrick Flanagan]

Hello, 

I’m wondering if anyone is building new apartment buildings these days? I understand that if you buy an older one, forcing appreciation is a way to make a lot of money. 

I want to build my own. I’m curious if there are any general contractors that do the work them selves to save on a lot of the costs?? 

I’m just looking for any tips or advice if building a new building was worth it. 

[Robert Rixer]

Working for a condo developer in my early career, 3 pieces of advice I can share.

1. Trying to make money through efficient construction is a losing battle. Even if you do everything right construction-wise (a big if), the added upside will be marginal. Bigger needle-movers are getting a great deal on the land, up-zoning to fit more units or the area naturally appreciating during the development process.

2. You have to get some other satisfaction from developing, other than just money. This could be building something tangible, improving the community, etc. The risks are skewed in development with so much that could go wrong (rezoning/permits process, construction, slow sales, tanking market, etc.) and the upside rarely justifies it when compared to buying existing. Yes there are people out there who do it very well but it's a tough business with a lot of pitfalls. 

3. Best time to develop is when the price of existing is above or at least close to the cost to build new. Obvious statement but people still develop when there's similar existing product half the price of replacement