|In favor of a co-developer / Wonderland Homes||<– Date –> <– Thread –>|
|From: Rich Lobdill (richardlcallamer.com)|
|Date: Mon, 13 May 1996 00:40:14 -0500|
We here in Grell Cohousing of Oceano CA, have been acting as our own developers (with no development experience) for nearly eight years. Four days ago the county planning commission gave tentative approval to our project (27 units, 5 acres). This is by far the biggest milestone we have passed to date. Eight years without breaking ground has presented us with a lot of reality. One signifacant shard of that reality is that developing a cohousing project through to completion is not a part time job that can be done after regular work hours even by the most dedicated group of amateur developers. We presently see what looks like a whole slew of benefits from bringing in a responsible co-developer not the least of which is feeling that developer expertise could heavily weigh the odds towards the project actually getting built within our lifetimes (a bit of sarcasm here). What I ask of the readers of this memo is such: We have made initial contact with Jim Leach at Wonderland Homes and are frankly very impressed with the goods his company has to offer. So much so that I presented the outline attached below to the group as justification for my proposal that we seriously pursue some type of working relationship with Wonderland. My questions to the readers are: Does it seem I'm misrepresenting the advantages of having a co-developer in general? (I realize that my presentation does not have pros and cons of have a co-developer, that was not my intent) >From those who have worked with Wonderland, am I overstating their abilities? Would you hire them again? Thank you in advance for your input and feel free to send comments directly to my e-mail address if you don't wish to post it to the world. Presented to the Grell Cohousing group general meeting May 9, 1996: The BIG picture according to Rich Lobdill 1) Presently, our main goal is to come up with a development process which will produce units as inexpensively as possible AND provide the structure for actually getting the project built 2) Every cohousing community built so far has had co-development assistance (risk taking) from either the public or private sector. 3) We should pat ourselves on the back for a job well done so far and then seek out co-development assistance, even with the possibility of the cost of the houses slightly increasing, so as to ensure that the project will actually come to fruition. Advantages of co-development Some burden of risk is transferred to developer. A significant amount of the developers fee is dependent upon the project being successfully built. The developers fees do not begin to be paid until construction commences. Liability insurance for the various consultants and contractors is covered under the developers insurance. Developer can take the risk to contract the finished price of the house with the future owner before the house is built. Developer does projects as a full time job. To be successful they must: Take a hard look at a project and see if it has the potential of actually being built. Accurately estimate early on the costs of the development and individual units. Develop and implement time lines and cash flow analysis. Develop and implement a marketing strategy Secure construction financing Be able to understand the strengths of their architects and compensate accordingly. Choose and oversee a general contractor during construction. Negotiate with the county during the approvals process. Why Wonderland Hill Development Company (Jim Leach)? They have been intimately involved in five cohousing projects. Three which are built and two under construction. Have a history of solar, energy-conserving and environmentally-progressive designs. Jim Leach has been developing planned communities since 1969. Have done low-income housing project. The last being a public/private funded 120 unit project. Have financial expertise on-board for overall view of project costing structure and a certified estimator who has worked directly with cohousers for costing base units as well as options, upgrades and customization. Will sign contracts with each buyer guaranteeing the price of the unit before ground breaking. Only requires the project to be 70% pre-sold before ground breaking. Wonderland will bear the risks of selling the rest. Are impressed in how far we have come on our own, understand that we have a financially and emotionally committed group and are willing to work to overcome the distance barrier. Are willing to work with all of our local resources and manage them as a cohesive development team Sincerely, Rich Lobdill Grell CoHousing Group, Inc. Oceano, CA
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