Development Soft Costs

[Emilio Ramirez]

Hello Folks,

Great site you have here. I'm a newbie and will introduce myself after I get this post done.

I'm working on my first development deal, a 65 unit independent senior living apartment building. I'm currently building the proforma and am trying to make sure I have all of my soft costs identified. I was hoping that some of you could help me spot items I might be missing and answer a few questions.

AE Fees
debt service(while under construction)
permit
survey
impact fees ( what are these?)
Land costs (is this a hard cost, soft cost or all on it's own)
Contingency ( I know I will have a construction contingency, do I also have a soft cost contingency? total project contingency?I understand it is up to me, what would you do?)
Phase I?
Market Study (i intend to do my own, but I'm not sure how to establish an absorption rate) the county gov't has some data published on this, but I would like to find a way to get my own numbers.
Builder's Risk (I would like to make this a construction cost. Can I buy this with my construction loan?)
Gen liability - Do I need this?
Prof Liability - Do I need this?
Incorporation (If I form an LLC with myself as the managing partner and 1 or two investors as limited partners do I need workers comp and do I pay unemployment ins? I would be the only active employee.)
Reserves (how do you determine what they should be? Is this a soft cost?Is this different than contingency?)

The project at this point will not cash flow until year three. How do i account for the losses in years one and two? Is this a soft cost?

Alright, I have a million more questions, but this post is getting lengthy. Thanks in advance. - Bwiab