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Townhouse development diary

Discussion in 'Development' started by g-dub, 4th Oct, 2016.

  1. g-dub

    g-dub Active Member

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    Hey folks,

    I thought I'd start this thread to act as a bit of a diary for a new project. Hopefully someone can gain some insights from it. If not it's a good excuse to document it anyway. Project particulars:

    4700m2 site
    1 house (needs demolishing) could possibly rent out for $200-250pw although it's in quite a bad state
    Zoned R2
    FSR 0.6 - this is good as the other 0.4 will be taken up by flooded impact zone
    Net developable floor area - 2800m2
    Flood impacted
    Expected yield - 12-19 units, depending on flood impacts
    27% margin @ 12 units
    41% margin @ 19 units
     
    Perthguy, wombat777, PacMan and 6 others like this.
  2. Agent30yrs.

    Agent30yrs. Well-Known Member

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    Where is it @g-dub ?
     
  3. hobo

    hobo Well-Known Member

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    @g-dub Not a small project - have you done a few of these before?

    Interested to follow how this goes.
     
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  4. g-dub

    g-dub Active Member

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    Hunter Region
     
    Last edited: 4th Oct, 2016
    melbourne171 likes this.
  5. g-dub

    g-dub Active Member

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    1st project but have worked in the industry for a few years - 10 years consulting/project management experience from feaso to practical completion.

    Thanks I'll try and keep it updated weekly at the very least
     
    Last edited: 4th Oct, 2016
    Luke T, PacMan, melbourne171 and 3 others like this.
  6. Agent30yrs.

    Agent30yrs. Well-Known Member

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    Off my radar but will watch with interest. :)
     
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  7. MTR

    MTR Well-Known Member Premium Member

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    All the best, keep PC posted, I am certainly not in this league but keen to watch and learn:)
     
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  8. g-dub

    g-dub Active Member

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    There are a lot of items to tick off under the DA requirements. I put together a quick table to help define the roles and define who will take care of each part/engage subconsultants.

    There will be 4 primary parties involved in the procurement of services and collation of the DA:

    Me
    Civil engineer
    Planner
    Building designer
     
  9. MTR

    MTR Well-Known Member Premium Member

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    Interested in the funding side? are you funding this yourself, some big $ here.

    I have found funding projects the most challenging, especially when you have other projects on the go etc.
     
  10. g-dub

    g-dub Active Member

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    JV with an equity partner. I'm not fully across funding at the moment as I'm focusing on delivery at this stage.
     
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  11. MTR

    MTR Well-Known Member Premium Member

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    Many years ago I would have poo pooed JV partner, but not today, I can see so many benefits if the right project comes along and of course you have a JV partner that ticks the boxes.
     
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  12. g-dub

    g-dub Active Member

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    @MTR

    I think it's a great way to run a project with mutual benefits. No that it's without it's risks! I'm happy to take them on in this instance.

    Cheers
     
  13. MTR

    MTR Well-Known Member Premium Member

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    ... and getting the right legal advice/docs in place.

    I know nothing about the Hunter Region, is it currently a strong market/demand for your product??

    MTR:)
     
  14. g-dub

    g-dub Active Member

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    Depends who you ask lol...I've seen a few posts on PC throwing it under the bus, others are a bit more positive. I'm part of the latter!
     
  15. MTR

    MTR Well-Known Member Premium Member

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    LOL, forums are hit and miss IMO.... the truth can only be obtained when I actually speak to the re agents on the ground, and not one but many and then it is relatively easy to work out what product is selling and how long it takes to sell.

    My thoughts - because Syd market has been booming there could possibly be a ripple effect to other areas, regions etc.

    However, what I think we are seeing with the current boom markets in Syd and Melb they are not repeating what happened in previous boom cycles. I find this interesting, the strong markets today have been due to a major factor, immigration and its not started in the desirable inner city areas but either affordable areas with good infrastructure or areas which have desirable school catchment.
     
  16. PacMan

    PacMan Active Member

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    G-dub have you completed a feaso my friend?

    For our learning experience can we have a look at the detailed feaso study to see how you arrived at those numbers. Appreciated.
     
  17. g-dub

    g-dub Active Member

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    @PacMan

    19 townhouse @ 135m2 floor area * $1800/m2 = $4.6m construction cost
    $200k consulting
    $500k additional site and headworks
    $750k purchase
    =$6m

    Sell $450k * 19 = $8.5m
     
    PacMan likes this.
  18. Leo2413

    Leo2413 Well-Known Member Premium Member

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    Interesting project mate.

    What about stamp duty, contingency, holding costs, selling costs

    Also your total costs above are $6,050,000 according to my calculator .
     
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  19. g-dub

    g-dub Active Member

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    SD - 30k
    Holding - 70k
    Contingency - built into the allowances
    Selling costs - I'm not 100% at the moment. Equity partner has an accountant lined up to sell through off market to his clients

    @Leo2413 nice avatar!
     
  20. ignorant_ecoboomer

    ignorant_ecoboomer New Member

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    Am following with interest mate, all the best.