Posted by Chris in FL on June 09, 2006 at 07:10:17:
I wish I was dealing in numbers that large, and could advise you better. I know if I was interested in developing the project, and if I thought I was going to make a profit similar to what you talked about, I wouldn’t mind you making a million or two to assign me the property. If you want to make more than that, maybe you should try to set up a double closing instead, and not disclose to your buyer what you are paying for the property (or did they already know the asking price?).
Also, if you really want to be in on the project, due to the allure of a monster payday, try giving a large developer a partnership offer that they can’t refuse. If they aren’t interested in a standard 50-50 partnership, what if you offered them 75% of the deal? You still stand to make a whopping big payday, but you are recognizing that the developer is taking on most of the risk and work, while your contribution, in that situation, was limited to getting the land under contract (I think; you didn’t say if you already did some rezoning or not, etc.)? You would probably do well to post on the commercial board (on this website) and ask people with more experience in that arena. I have only done residential deals, and just threw a suggestion out there to make sure you were aware of other alternatives. Often people get so focused on a project that they lose sight of an easy avenue to a payday by wholesaling. I have seen people walk away with nothing on a great deal because they couldn’t close, and, meanwhile, they could have wholesaled and still made a decent profit. That just seems silly. Best wishes!