Developers: How Do You Guys Make So Much Money?

[Jim Macedon]

I put a piece of land under option and went through the whole process of getting quotes for everything for a 36 unit condo project.  Below are the numbers I came up with.  I have no idea how to make money in development now.  What am I doing wrong? (Sorry, I'm sure the formatting will get screwed up when I copy and paste this.)

Costs
Costs that can be financed
43200	x	$140	=	$6,048,000	building costs
			$75,000	pool
			$150,000	site work
			$85,000	land
			$10,000	design fees
			$60,000	civil engineering
			$5,000	legal fees (condo incorporation)
			$100,000	developer fees
			$288,000	commissions and closing costs
			$7,000	web design
			$6,828,000	total financiable costs
Costs that cannot be financed
			$1,092,480	closing and interest costs
Total cost
			$8,208,480	total costs
Total cash cost
$6,828,000	x	0.2	=	$1,365,600	down payment on construction loan
			$1,092,480	closing and interest costs
			$2,458,080	total cash cost
Revenue, Profit, and ROI
			$200,000	estimated sales price per unit
36	x	$200,000	=	$7,200,000	revenue
$7,200,000	-	$8,208,480	=	($1,008,480)	profit
($1,008,480)	/	$2,458,080	=	-41.03%	ROI