All Forum Posts by: Jonathan Orr

For the financing, I would recommend a broker.  Someone who does more than just traditional family purchase lending.  Find a commercial broker, helpful if they are local to you but not necessary.  For the first time, they are going to be in your corner to make sure you have the correct financials, documents and be able to share the "story" of your builds with lenders.  Instead of going at it alone, I find it worth paying the point or 2 when the loan closes to make sure you are getting a good deal.

As for the second question, that all depends on your strategy and many other questions.  How long are you going to hold them, are you going to live in one, are you going to refinance, etc...When you are ready to sell, then I would recommend worrying about the tax implications and talk with your CPA.   without more detail, I would think a 1031 is your best route, or hold them and max the refinance and maybe pull cash out of them that way.  

I would think it would depend what state the plans are in.  If they are 100% done and approved, that seems high to me.  for 75% completed plans for a industrial project I was quoted around 2-3k for a budget, this was for a 65k sq ft industrial center.

I found estimators on a website called upwork.  I ended up just going to the GC I was going to hire and they assisted me with a bid/budget.

My question is why don't you go to the GC that you intend to have build it and get them to provide you with a budget?  

Hope this helps

It would depend on what you are trying to accomplish and how the builder will participate.  If they are only the GC, a larger builder may have better pricing and resources.  However, a local GC may have recommendations such as finishes or potential things that could attract buyers, a local builder might also be familiar with the inspection and permitting process (if it is not done) and be able to help navigate with those things.

Really depends on if you only need them to build, or if you are looking for them to help with anything outside of just construction.

To elaborate on what @Ronald Rohde said (I agree with) in looking at a FAR is because unlike MF where you can go vertical with units and meet the zoning specifications.  You will have different requirements for every property you come across.  For example, my contractors warehouse/garage project I am doing in AZ has setback requirements on the South border but not the north.  This limited me in being able to do things. That being said, I knew what FAR I wanted to hit so even though I had restrictions, I worked with my architect to get and exceed the FAR that I wanted.  Hope this helps explain why with industrial or even retail a "standard" amount of units is not viable when looking at potential deals.

@Ian Dunross we are moving forward on the deal in AZ. With the varying in suite sizes that I am doing, I would focus on floor area ratio, rather than units per acre. We are at a .32 FAR, in my proforma the sweet spot is anything north of 30% coverage.

 John, depending on your markets you are looking at and exactly what you are looking to do; I know a guy on the brokerage side who is involving himself in larger deals like that.  Don't know much besides that, as it's not my purview, but happy to connect you.  Send me a PM

 Larry, I have several different models that I have collected through the years.  That being said I am no longer involved in MF and have transitioned to commercial development.

@Barry Ruby I appreciate the offer. I got out of SFR and am strictly involved in Commercial Development now. Thank you again

Have a multi tenant industrial property in Phoenix AZ and looking for recommendations on property managers/management companies. Will be a NNN property.