Join Australia's most dynamic and respected property investment community

Price per site in big estates

Discussion in 'Development' started by ej89, 16th Oct, 2015.

  1. ej89

    ej89 Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    688
    Location:
    Sydney.
    Hey,
    Does anyone know how much a big developer would roughly pay for each lot in a 200-400 lot development when selling each individual 300sqm lot for around the 150k mark in SEQ. e.g yarabilba, park ridge, redbank plains, springfield etc.
     
  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    13th Jun, 2015
    Posts:
    2,959
    Location:
    Perth
    Do you mean how much they paid for the land in the first place before they developed it?
    If they are selling for approx $500 per sqm then they probably paid about $100 per sqm in the wholesale land area, then they lose 30% of that land to roads and public open space then sell the end blocks around $500 p sqm.

    If you mean developers as in House and Land packages where they buy the completed lots then they may only get a $10-25k or so discount per lot for buying a group of them.
     
    ej89 likes this.
  3. ej89

    ej89 Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    688
    Location:
    Sydney.
    Yeah asking about before they developed it so original site. thanks mate. Is there a formula I can use to calculate price per site a developer should pay if sold at $x amount?
     
  4. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    13th Jun, 2015
    Posts:
    2,959
    Location:
    Perth
    Not really. I had to make a lot of assumptions on that figure because some areas have massive infrastructure, retaining, flooding, fill, excavation etc requirements but the end price would hope to be 3-5 times the original wholesale price.

    Generally in large developments you need to work it backwards. Start with how much land is selling for then how much it will cost to develop then profit of xx% then that is how much you want to pay for it.
     
    ej89 likes this.
  5. ej89

    ej89 Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    688
    Location:
    Sydney.
    No worries thanks mate
     
  6. Tekoz

    Tekoz Well-Known Member

    Joined:
    24th Jun, 2015
    Posts:
    1,244
    Location:
    Sydney
    What about the information provided from this website: http://pdonline.ipswich.qld.gov.au/pdonline/Modules/PropertyMaster/default.aspx?page=search

    It has some information like th following with pricing if that is waht you're after when you enter the location range:

    01/07/2015 - $134,000 Non-Rural - Site Value
    01/07/2014 - $134,000 Non-Rural - Site Value
    01/07/2013 - $134,000 Non-Rural - Site Value
    01/07/2012 - $149,000 Non-Rural - Site Value
    01/07/2011 - $149,000 Non-Rural - Site Value
    01/07/2010 - $124,000 Unimproved Value
    01/07/2009 - $124,000 Unimproved Value
    01/07/2008 - $124,000 Unimproved Value
    01/07/2007 - $104,000 Unimproved Value
    01/07/2006 - $104,000 Unimproved Value
    01/01/2006 - $104,000 Unimproved Value
     
  7. Jeffb

    Jeffb Active Member

    Joined:
    13th Jul, 2015
    Posts:
    43
    Location:
    Melbourne
    I don't know what the sites sell for originally, but to develop from scratch you are looking 60-80k per lot for a subdivision of that proportion. So $24-32mil for development costs for 400 lots.

    So then 400x150k = 60mil. Minus development cost, minus land purchase, minus profit margin.

    Hope that gives an idea.
     
    Tekoz likes this.
  8. ej89

    ej89 Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    688
    Location:
    Sydney.
    So if I can pick a 400 lot site for $3m how would I on-sell it to a developer without purchasing it?
     
  9. Jeffb

    Jeffb Active Member

    Joined:
    13th Jul, 2015
    Posts:
    43
    Location:
    Melbourne
    I think you'd have to strike a deal with the owner of the land.
     
  10. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,575
    Location:
    Sydney or NSW or Australia
    $7,500 per lot raw?

    Where are you looking, Simpson Desert?
     
    ej89, wombat777, Hodge and 2 others like this.
  11. ej89

    ej89 Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    688
    Location:
    Sydney.
    It's a secret :). Yep 7500 per lot raw.
     
  12. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    13th Jun, 2015
    Posts:
    2,959
    Location:
    Perth
    just remember that you lose around 30% of the land to public open space and roads etc so a site which is divisable by 400 is actually only 280 lot subdivision
     
    ej89 likes this.
  13. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,575
    Location:
    Sydney or NSW or Australia
    How much of the site is zoned "environmental protection"? "Water catchment " and electrical transmission easement?

    As noted by others, 1/3 will go to circulation/parks etc but your development costs per site will not decrease.

    Speak with a QS or civil contractor for works budget - this won't change whether you pay market or zilch for the land.
     
  14. Jeffb

    Jeffb Active Member

    Joined:
    13th Jul, 2015
    Posts:
    43
    Location:
    Melbourne
    I'd round up everyone you know to try and raise $3mil to purchase it.