Posted by Lee on December 07, 1999 at 22:39:14:
Hi Von
Sounds like you don’t need help, You’ve got it!
Just be sure you know the zoning laws and the Federal laws re: “senior” multifamily housing.
I hope the legal team is (for your sake) working for you.
Re Surprised I got this far… (No Money)… Make sure you keep it that way!
Regards
and Merry Christmas
Lee
ANY BIG RE PLAYERS OUT THERE…NEED HELP - Posted by Von
Posted by Von on December 07, 1999 at 21:34:39:
I GOT BOLD AND MADE AN OFFER ON THE LAST 3.5 ACRE COMM’L PROPERTY(LOCATION WITH-HELD)IN TOWN. I MADE A DEAL TO PARTNER WITH THE SELLER TO BUILD A HOTEL/RESTAURANT,SUBDIVIDE AND BUILD A SENIOR HOME ON IT. I HAVE A DEVELOPER AND POSSIBLE DIRECT CONSTRUCTION/PERM LENDER LINED UP AND LAWYERS ARE ON THE SCENE. BASICALLY I’M SURPRISED I GOT THIS FAR (I HAVE NO MONEY)I WOULD APPRECIATE A MORE EXPERIENCED INVESTOR/DEVELOPER TALK ME THRU NEXT STEPS. PLEASE…PLEASE E-MAIL ME
Ok, here is some follow up for you or anybody else to learn from… - Posted by Shawn M. Crawford
Posted by Shawn M. Crawford on December 08, 1999 at 14:51:50:
Von,
In order to help others on the board, including yourself, I offer the following comments on your reply:
Your first question…“When do I obtain an accountant” judging by the question you have asked I assume you have never had one…therefore I would pose the following ? to you…are you exepensing or receiving any monies in 99 on the property?
The second ? has multiple questions… in your order-well no in my order…why are the construction costs inlcuding anything other than construction cost? Make a spread sheet showing colummns including but not limited to earnest money, nonrefundable earnest money, purcahse price, proceeds from extaneous land sale, commisions, closing costs/escrow fees, title insurance, property taxes, interest on deposits, legal, survey, enviromental reports, Arch/mep/structural fees, reimbursables, blueprints, civil, soils, landscape, traffic report, plan check fees, building permits, water fees, sewer fees, electric and gas fees, impact fees, refundable deposits, builders risk, construction inspection, material inspection, financing costs, construction cost, extraordianry site work, extraordinary building costs. I think this is pretty inclusive-but if others post plese listen to them also. All of the above should be fianaced if possible and definately tracked seperately.
The last part I don’t understand. Are you going to operate the Hotel? Are you selling the site improved with hotel to a franchise or independant hotel operator? Does the seller have a crew that can build a ( ) unit hotel in six months? Are approvals in place from the city. From the Franchise? What about FFE (furniture, fixtures?).
Von…I developed hotels all over the country and it take a he** of a lot of work but it also can take up to two years (and lots of nonrfundalbes) to even think of starting construction.
I emailed you my phone numbers…call me with a note pad, pen and calculator in front of you (smile).
Shawn
ps please post follow ups on the board for others to learn…even if it is something I tell you telephonically.
I used to work for two hotel companies… - Posted by Shawn M. Crawford
Posted by Shawn M. Crawford on December 08, 1999 at 06:49:41:
and have two large loose leaf books that outline the development of a project from site identification to build-out. I also did this for three years.
What specifically would you like to know?
ps if Ray reads this, I am still working on getting the management co. to give me the info on my office building deal.
I’ll help if you promise not to yell (smile) - Posted by ray@lcorn
Posted by ray@lcorn on December 07, 1999 at 23:55:35:
Von,
Before I respond to your question, could I ask you to please turn of your caps lock? It is considered yelling on the Internet to type in all caps. Thank you.
Now, to your deal:
I have developed a project very similar to what you are proposing, which included a hotel, restaurant and two medical office buildings. It took over a year of planning and up front work, at a cost of over $100T, to get to the point we broke ground on the hotel in the first phase of construction. I always knew it would get built, but sometimes I wondered who would own it when it did! But we were acting as an owner-developer-operator, and you say you have a developer lined up. I would have to know how you propose to work with the developer in the deal before I can advise you about how to move forward.
In most development deals, the property is optioned from the seller, or otherwise controlled until the developer obtains all the approvals and committments from his tenants or users, i.e the restaurant, hotel and senior care facility. It sounds as though you and the seller plan to stay in the deal, as landlords maybe?, I can’t tell. Or is your intent to obtain the property, develop the improvements, and sell them to the end user? Let me know your game plan and perhaps I can be of more help.
It sounds to me that so far you have had a good conversation with a willing-to-make-a-deal seller. That’s a great start, and it sounds as though you may have a grand concept. One thing to know about this business from the get-go though, is that the devil is in the details.
Number one on the list should be the details of the partnership agreement; such as who contributes what and pays for the upfront cost to get the development to the finance stage: the equity split should be well established before you start, or you will never finish arguing about it. I highly recommend that you use the “lawyers on the scene” to draft and execute the appropriate organizational documents. I would also advise that you take another look before entering creating a general partnership. As an ownership entity, it sucks. An LLC is the most favored entity of recent years.
Depending on the nature of the relationship of you and your partner with the developer and the lender involved, appropriate contracts and agreements must be drawn and executed with them as well. Any guarantees of performance, bonds, penalties, events of default, etc., need to be negotiated now rather than argued about later. Everybody must have a clear understanding about what is expected of all parties. A multi-use development is a complex orchestra to direct from any capacity, and it only takes one missed cue to start a domino effect of consequences. Again, not knowing your objective here I’m just hitting the high spots that are true of any deal.
I am curious as to how you are going to fit the hotel, restaurant and senior living facility on 3.5 acres? Is this a high-rise project?
Let us know some details, and I can be more specific.
ray
Re: ANY BIG RE PLAYERS OUT THERE…NEED HELP - Posted by Jim Pasquini
Posted by Jim Pasquini on December 07, 1999 at 23:45:31:
I have some associates that I was helping convert a property to an assisted living facility. There are only a handful of players in that market. I would contact them to see if they are truly interested. They might cash you out nicely if they want the property. E-mail me if you need some contact information for the senior living businesses. I think I still have it laying around in the office.
Keep us informed on the progress - Posted by Potash
Posted by Potash on December 07, 1999 at 23:38:23:
lmao