When Yogi Berra stated, “If you don’t know where you’re going, you’ll wind up somewhere else,” he wasn’t mistaken.
The same is true for your development build. If you don’t have a plan, something else will happen instead of what you had intended (or nothing).
Any build-to-suit project’s objective is to successfully collaborate to give tenants efficiency and customization while also helping them grow their businesses. So why not adopt a straightforward and efficient method for usage from concept to completion?
Here is a brief guide on approaching a new build-to-suit development in 7 steps.
1) Examine the Market (s)
Determine how your organization can expand the most effectively. Consider the market’s total supply and demand. Are you satisfied with the demographic trends? Are they what you wanted or expected? Are there any needs or gaps that you can fill for some users?
2) Establish needs/long-term objectives
With build-to-fit developments, it’s crucial to remember that the leasing and construction schedules frequently have longer durations than usual. Tenants should identify their demands and long-term objectives before signing up with a build-to-suit project to see whether it is the best option.
3) Identify the Requirements
- Complete your planned building needs, which should include:
- Its intended usage
- Size approximation
- Completion timetable necessary
- Suggested lease duration
- Additional specific lease conditions (if any)
- A draft budget that gives you a general idea of the costs associated with the project is included.
4) Selecting a Reliable Developer
The next step in your approach is to follow the necessary procedures and to ask the appropriate questions to select the best developer. Typically, a renter will wish to evaluate:
- Skills, personnel, prior work on related projects, and relevant references
- A list of the specialists on the developer’s team may be consulted for the project, such as architects, engineers, land planners, and lawyers
- A basic explanation of the project’s approach that the developer would take
5) Planning and Designing
Making the precise building blueprints is arguably the most crucial problem dealt with in a build-to-suit transaction before construction. Specifications for the various building materials and parts, as well as the attribution of responsibility for different plan elements, will be included.
6) Site Selection and Evaluation
You’ll start the site selection with the analysis step when you’ve determined your needs and specified the site criteria. A vital step in the selection process is the analysis of particular categories of data about each competing website. The advantages and disadvantages of each potential development site are emphasized by side-by-side assessments of the locations and established feasible prospects.
7) Calculate expenses
Reviewing and ultimately approving the work budget go hand in hand with reviewing and approving the plans. Based on the approved blueprints, a general contractor will offer more exact cost parameters for the project’s construction. It immediately affects how the rental rates are influenced since the developer or landlord will base the rent price on those building or development expenditures.
This summary is to help you set a strategy in place and carry out your project from beginning to end, even though build-to-suit development contains many nuances, ins and outs, and may be challenging.
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Come join us! Email me at mark@dolphinpi.us to find out more about our next real estate investment.