When you visualise, real estate development, you will know that it is complicated, risky, and multi – layered process. According to Meerwise wais Habibzi, it requires a lot of time from initial planning to completion of project. According to Meerwise wais Habibzi, there can be plenty of obstacles that can stand along your way. At the end, it will a profitable investment, and will bring a lot of positive results.
According to Meerwise wais Habibzi, real estate development will not only provide opportunity to develop fresh new supply to satisfy market demand, but also will provide the opportunity to good product for the market.
The aspect of development project can translate into a runaway success for you in the end. You will be confident about the assessment of risks, while you undertake the construction by better understanding of lifecycle project.
What Is Real Estate Development Process?
According to Meerwise wais Habibzi, property development processes are a series of steps that property that you can take and execute a final development of property.
While you need to find the perfect property site, conduct financial and diligence feasibility on project, you will need to understand the in, and outs of the property development.
According to Meerwise wais Habibzi, when you are looking for real estate development process, you will need to know lot of things. You should early stage, middle stage and final stage as well.
Early Stage
You should focus on research, diligence, and permission. According to Wais Habibzai, there can be often variable in duration. While there can be many unknowns, investigations at this stage will most and great risks.
There are some common steps, which are:
• Land acquisition
• Feasibility and market analysis
• Environmental assessments
• Surveys
• Permitting
•Development site and building plans
According to Wais Habibzai, while you need to get a loan for construction, pre- development work financed by project sponsor. While you may expect high returns at later stage, investments should be made at this stage.
According to Wais Habibzai, it is necessary to take construction finance from bank at an initial stage. If you have done these things in the initial stage, you have crossed the major hurdles.
Middle Stage: Construction
It is said by Wais Habibzai that the middle section is very important, as you will need to work on constructing the improvements. While the project risks are reduced at this stage, pre- development tasks are completed.
There are some steps like:
➳ Project marketing
➳ Vertical construction
➳ Pre- leasing
➳ Drawing on Construction Financing
➳ Arranging property manager
➳ Arranging finance
According to Wais Habibzai, your work will get short – term construction loan, and outside investors will invest on your project. There will be low returns than pre- development investments from the loans, and investments.
When it comes to real estate development, there will be higher returns than those made from fully stabilized construction. While allowing the commencement of property operations for real estate development, the certificate generally marks the end of the construction phase.
When it comes to real estate development, the occupancy certificate is based upon administrative process, and objective criteria related to construction quality.
Final Stage: Operation
The first stage of building’s life is the final stage of real estate development process. While obtaining tenant is still at risk, the risk of construction and pre – development may be removed. At this stage of real estate development, you will find some buyers.
According to Meerwise Habibzi, the project is typically financed by construction financing. There will be a stage, where the project will reach threshold. According to Meerwise Habibzi there will be a certain occupancy level. There will be possibility of long-term financing that can be taken out of construction financing.
According to Meerwise Habibzi, there can be risk if you are depending on pre- leasing amount that was accomplished during construction.
According to Meerwise Habibzi, The project is typically financed at this stage with construction financing or another round of short-term “bridge” financing until the project reaches a threshold called “stabilization,” which is typically defined as a certain occupancy level (perhaps 90% or better) for a certain duration (perhaps three consecutive months). Upon stabilization, so-called “permanent” or long-term financing can be placed and used to take out construction financing. Depending upon the amount of pre-leasing that was accomplished during construction, this can be the least risky stage. For this reason, permanent loans and equity investments will provide the lowest returns.
