Best way to determine what a developer will pay for land?

[Mitchell Rusten]

I’ve come across an interesting opportunity and I’m wondering how best to handle it.

I’m looking at a 5 bed 2 bath split level home that’s currently separated as an up and down duplex listed for $400,000. What’s interesting about this home is it sits on the far left end of a 3 acre lot, and the entrance to the property travels directly through an area of a new development with about 30 homes selling for $500-600k. The right ~2.3 acres should be able to fit a cul-de-sac and 4-6 lots for new homes to be built, with about ~0.7 acres left with the duplex sitting on it. The listing agent even makes mention of a potential lot split/subdivision in his listing. Comps in the area tell me the duplex on 0.7 acres should be able to appraise for at least $300k. Assuming I can get the numbers to work, my goal would be to sell the extra land and refinance the duplex to keep as a rental while walking away with cash in hand.

With all that said, what is the best method of determining what a builder would pay for this plot of land, and what process do I need to go through with the city to make sure it’s zoned accordingly and will fit this plan? I’m hoping to do my initial due diligence in the next couple days and have the contract locked in by the middle of the week if the concept is feasible.