Structuring the right deal?

[Joyce Kim]

I own approximately 30,000 square feet of land in the LA area, and a developer has expressed interest in either purchasing or co-developing the land. We could potentially subdivide the lot into four lots and build a main house, a Junior Accessory Dwelling Unit (JADU), and an Accessory Dwelling Unit (ADU) on each lot. There is an old house with some code violations and a tenant in it. Our intention is to demolish the house and proceed with the subdivision.

Since I lack experience working with developers, I'm unsure what would be a fair arrangement for me in this deal.

How much does a developer typically charge for the scope of work? I'm considering 20% of the final profit. I would appreciate your thoughts on this figure:

1. Subdivision process (estimated duration: 2 years)
2. Entitlement to construction process of 4 lots
3. Property management (if we decide to hold onto the property)

If I were to sell the lot, what would be a fair price for me, considering that I can subdivide it into 4 lots? Would charging the market price for four lots of vacant land be considered fair?

Thank you!