Residential Real Estate Development – Keys to Success

Developing prime residential real estate takes research and planning. The first step in the development process is finding attractive property. The development group needs to select property that has unique natural amenities, or contains a specific terrain, this is beneficial and adds to the overall theme that a development group is establishing. Pivotal’s knowledge and experience in property selection has been proven by their development in the western region of the United States. Pivotal pinpoints growing areas around the US and begins planning residential developments. Finding lucrative property within these areas allows Pivotal to develop master planned communities that meet the high expectations of their residents. Pivotal has been successful developing residential areas in both downtown and suburban locations. The specific location of the property is not as important as what the property offers residents. There are many categories within the property that have to provide a balance making the property an ideal development opportunity.

Finding the ideal property and combining it with a pristine home builder facilitates Pivotal to provide attractive homes located on beautiful property. Pivotal has teamed up with award winning builders from all over the country to design and build homes within their master communities. Utilizing the expert construction knowledge of the builders along with the ingenious design of the architects allows Pivotal to create luxurious homes within their master communities. The builders who are contracted by Pivotal understand the high expectations that Pivotal demands, and the high quality product that Pivotal provides to its residents. Pinnacle Peak Place is a master planned community that Pivotal developed in Scottsdale, Arizona. Pivotal teamed up with Geoffrey H. Edmunds and Associates to design and construct the homes within the community. This partnership resulted in beautiful custom homes ranging from $1.5-3 million dollars. These types of results are what Pivotal uses to attract investors from all over the United States. The relationships with builders that Pivotal establishes and maintains allow them to replicate these results.

Adding legendary facilities completes the residential real estate development. Many of Pivotal’s master planned communities have spas and other retail sites located within them. These amenities add to the convenience that residential real estate developers are looking to provide for their residents. Signature golf courses and first class fitness facilities help complete the development process. Pivotal has teamed up with the best golf course designers in America to offer their residents a unique golfing experience. Jack Nicklaus designed the 18 hole championship course that Pivotal I built in their Cimarron Hills community. This kind of expert knowledge shows residents that they are receiving the best quality when they move into communities that Pivotal has developed.

Pivotal has helped transform residential real estate development from home building into community design. Pivotal developed communities are planned and designed taking into consideration the needs and expectations of potential residents. This allows the architects and designers the freedom to create master communities.

Real Estate Development – Applying For a Property Development Permit!

The development permit is one of the keys to a successful real estate development project. Problems getting a permit approved can cause major delays and result in increases in holding costs. We like to do everything possible to ensure in advance that our development application will be approved smoothly and quickly.

Once we secure control of a site, we assemble the project team that will design and document the proposed development in accordance with the requirements of the Local Authority, the design brief and development mix.

Depending on the complexity of the project, our real estate development consultant team usually consists of:

– Property Accountant
– Property Lawyer
– Architect
– Town/Land Planner
– Civil/Hydraulics/Structural Engineer
– Land Surveyor
– Landscape Architect
– Quantity Surveyor
– Finance Broker

Other possible team members, such as acoustic and traffic specialists, may also be required by the Local Authority to submit a detailed report with the Development Permit Application.

To minimise the risk of disputes, we create a written agreement with each consultant. The agreement we typically use describes, among other things, the basis on which fees are calculated, the fee structure and services to be provided at each stage and the method by which we agree for the consultant to proceed to the next stage.

The architect will draw up plans for submission to council (these aren’t the detailed plans required for construction) that fit in with the planning regulations and the local authorities development guidelines, using a contour survey prepared by the land surveyor. The town/land planner is often involved at this initial stage, providing advice on the overall planning policies of the Local Authority.

Today most architects use sophisticated 3-D CAD software to compile drawings as it allows for ‘virtual’ buildings to be created. This system has the added benefit of creating fly-throughs and 3D images (also useful for the sales process and submission to Council) as well as documentation of the building for the Development Permit Application and for Construction by the Building Contractor.

We normally tailor our designs and standard of finishes slightly above the requirements of our target market, so they stand out from other developments on the market. This way our projects have the potential to attract a premium rental and sale price plus it makes it a lot easier to sell, if we need to.

The Local Authority will assess the submitted Development Permit Application for its impact on the neighbours, local community and the environment, typically including:

– Privacy for neighbours
– Traffic generation
– Overshadowing of neighboursAdverse impacts on air, water, and noise levels
– Amount and type of waste the project will generate
– Other areas of concern include historic districts, parks, open space, trees, and wildlife habitats

If the consultants have all done their jobs well, most of these concerns will all be addressed to the satisfaction of the Local Authority within the development application, and approval should be given within a reasonable timeframe.

The actual development approval process will obviously vary between areas, and it is continually under legislative review, so up-to-date information should be obtained from the local authority and/or the Planning consultant on your RED Team.
After a Development Permit Application is lodged with the local consenting authority or Council it would typically follow something similar to the process below:

– Initial Review
– Expert Referral
– Advertising and Notification Period
– Assessment
– Outcome

Several factors can delay the development application consent process which can end up becoming costly to a property developer. Here are some of the most common assessment delays:

– insufficient information
– non-compliance with development rules
– poor designs creating unacceptable impact on the neighbourhood
– objections from neighbours or other groups
– unsatisfactory impacts on trees
– complexity of assessment reports
– external referral delays

It’s not necessarily the end of the process if Council has refused the development permit application. An experienced architect and planning consultant can greatly assist in challenging a planning decision.

Dubai Real Estate Developers Revising Prices and Payment Plans Based on New Market Conditions

With an estimated 70+ projects that are now for sale across Dubai, we are increasingly seeing Real Estate Developers revise their offering, prices and payment plans to gain market share.

While the major established developers like Emaar Properties, Nakheel and Dubai Properties Group are still able to sell out projects with relative ease – there are now dozens of smaller, private developers that are building various types of projects across Dubai.

The competition is strongest on the mid-end segment. Hot spot areas of development include projects like Dubai Sports City, Jumeirah Village and the greater Dubailand area. With so much competition in this segment, developers are adapting to the market place with new, innovative campaigns and product placements.

A bit of background; Dubai’s real estate market crashed in late 2008 and between 2009 – 2011, the market corrected drastically with prices declining between 30 – 50% in some cases.

Starting in 2012, mainly as a result of instability in the region (remember the Arab Spring), billions of dollars poured into Dubai – largely being diverted into the local real estate market.

From 2012 – to late 2013, the market appreciated drastically. In order to cool down the market and prevent another bubble, the Government took a number of measures to prevent speculation. An increase in the mortgage cap, doubling of transaction costs and preventing off-plan buyers to resell immediately have all contributed to a slow down.

The slow-down has not been as drastic as once feared. The correction which began in mid-2014 has seen prices decline by 7 – 10% on average for most communities. Many of the small and medium sized investors have started consolidating their positions. Most mature communities have high occupancy rates and now witness less transactions.

The overall market has now shifted towards the off-plan market. Buyers from within Dubai and from overseas are attracted to purchasing on payment plans which minimize cash flow and risk.

Thousands of units have been announced for development since 2013. In the long run, the city will require new housing to counter a growing population and high rental costs which contribute to the high cost of living in the city.

With so many under-construction projects, developers are competing against one another in ways that they have never done before.

Developers are revising prices downwards and in an interesting turn of events, many new projects are now offering payment plans which extend to upto 3 years after completion – a concept which was pretty much unheard of a few years ago.

Good examples of these extended payment plans are projects like Royal Estates in Dubai Investment Park, GGICO’s numerous developments in Sports City and Dubai Silicon Oasis and Al Khail Heights.

Even high-end developments are beginning to introduce flexible payment plans. Fortuna Village, a 30 townhouse development enclave within Victory Heights, has recently offered buyers a chance to pay off their units upto one year after handover on a 6% increase on the purchase price.

According to research done by on under-construction freehold supply, there are 9,000 villas, 6,300 townhouses and 38,000 apartments currently under-construction across Dubai.