All Forum Posts by: Jon H.

We're in the process of Title 24/PV mapping and a Gas/Electric appliance selection for our multifamily development in San Diego, our utility provider is SDGE. 

I understand there are a lot of energy rebates out there for upgrades/improvements but it appears that most all of these are exclusively built for homes occupied by the taxpayer and not for the purposes of use during a larger development. Looking for recommendations and experience with energy efficiency rebates, appliance selection based on value to rental impact (is no gas for new development generally acceptable?) or and any equipment decision-making from those who have built multifamily homes not part of any affordable housing program. 

So far, I have found no programs that a MF development qualifies for and our only benefit is reducing environmental impact, offsetting utility costs with PV.  This leads me to believe that we keep a select few gas appliances in our development if we are to position them for sale in the future.

Hi @Chris Seveney, thanks for the note. The asset is a duplex that is occupied at significantly lower than market rents. We are halfway through permitting, so no physical changes or construction done yet. Thanks for your advice.

We're currently halfway through development planning (including soft costs) to a coastal multifamily development project. Looking for any anecdotal references on developers who have delayed current WIP projects due to rate increases. 

I'm aware every project is different and there are a lot of complex details that impact a financial decision whereas simple responses here would not be reflective of great advice. We're primarily looking for some feedback on general topics that are included in decision making that cause a delay in MF developments. There are many fellow San Diego based large developers holding off on projects, so I want to see how far down in project size that trend is going.

The options we have are:

1. We stall development, cleanup current property, rent at market, hold our I/O 2.9% rate for the next 5 years while still locked in and pick back up development when rates fall in the next few years. Essentially any Reno costs need to be recouped at +ROI before development begins.

2. Continue with development but stall until we believe rates are good enough to move forward with an 18mo construction plan. Essentially this leads to worse loan terms, higher debt allowance and worse ROI on the project.

We'll surely run this evaluation in detail and we would appreciate any feedback from Socal or National developers who are involved in 2-20 unit projects.

Thanks BP Pros!

@Nabil Suleiman, that's a great point. We were full aware that purchasing this duplex would come with many decisions that needed to be made after the fact. There are no current plans approved and we've identified a good 6-9months of coastal commission work in and of itself. The great part about the area is there are so many other permit applications that were approved in the past 10 years for add-ons and complete tear downs so we have some references to look through. The GC we are thinking of going through has done a few properties in 2020 with CC permitting and he mentioned it's not too painful just takes time. We'll make sure to vet an expediter to support anything we do.

@Justin R. I'll pm you specifics!

I'm interested to hearing experiences from those on here that have invested in construction projects on properties they own. We've acquired a coastal duplex in Southern California and are looking at the options to renovate cheaply or build up now, investing for better CoC and resale down the line, details below and happy to answer any specific questions about the property if you want to chat in PM!

Unit Specs:

- Single level - 2units (2bd/2ba each), 2k combined footage, detached with carports and small yards, plenty of off-street parking on the lot.

Area info:

- Few blocks from the ocean, zoned as high density allowing 3 stories up to 35 feet with coastal commission approved plans

- Neighboring lots are multi unit (some 8+) and 2/3 stories, we're one of the only remaining single levels.

My main concern is building costs, timeline and mainly being inexperienced in larger scope construction projects. We've done a handful of $100k or less renovations but never new story builds/extensive framing/permits like this, it's always been cosmetic and repair.

Seems like it comes down to having the right financing (which we have) and construction crew you can trust (which we are vetting). If the numbers work, would you pursue a 12mo permit/build process in 2021?

Thank you in advance!

I'm interested to hearing experiences from those on here that have invested in construction projects on properties they own. We've acquired a coastal duplex in Southern California and are looking at the options to renovate cheaply or build up now, investing for better CoC and resale down the line, details below and happy to answer any specific questions about the property if you want to chat in PM!

Unit Specs:

- Single level - 2units (2bd/2ba each), 2k combined footage, detached with carports and small yards, plenty of off-street parking on the lot. 

Area info:

- Few blocks from the ocean, zoned as high density allowing 3 stories up to 35 feet with coastal commission approved plans 

- Neighboring lots are multi unit (some 8+) and 2/3 stories, we're one of the only remaining single levels. 

My main concern is building costs, timeline and mainly being inexperienced in larger scope construction projects. We've done a handful of $100k or less renovations but never new story builds/extensive framing/permits like this, it's always been cosmetic and repair. 

Seems like it comes down to having the right financing (which we have) and construction crew you can trust (which we are vetting). If the numbers work, would you pursue a 12mo permit/build process in 2021?

Thank you in advance!