[no subject]
From: Rowena Conkling (rowenacworldnet.att.net)
Date: Mon, 9 Sep 1996 14:28:42 -0500
 You asked how much developer's are getting paid and what they are doing.
You will find that the responses are all over the lot.  I asked the same
question last spring when we were first getting going and couldn't make a
lot of sense of it.  We ended up paying a development consultant a modest
fee to review our agreement with the developer to see if it was reasonable;
he made some minor suggestions but thought we had an OK deal.  Anyway, here
is a brief summary of the statement of work. 

Our Agreement breaks the work down into five phases.  The first Phase ended
when a purchase and sale agreement was signed on the property.  Up to that
time, our developer did not receive any payment!  They searched for sites
and developed preliminary schemes for three of them to show how the
development might work, negotiated with the owners, developed preliminary
budgets, etc. and did preliminary investigation of such matters as
environmental problems.  We did not use a realtor since one of the
developers is also a realtor with extensive knowledge of the area, thereby
saving a 5-6% fee.  When the first phase was complete the developer received
their first payment.

The 2d Phase consisted of schematic design and review, working with the
group to develop the master plan and common house requirements; meeting with
groups of households wanting similar sized units to establish a "standard"
size and layout; talking with individual households where necessary.  All
this preliminary design work was done "in-house."  They assisted with
marketing; investigated financing; obtained surveys and soils analysis;
prepared documents and plans for application for a Special Permit and acted
as liaisons with the city planning department.  They discussed energy and
environmental issues and efficiencies with the group.   They investigated
financing possibilities and obtained several rough construction estimates
from contractors.  They assisted in presentations to the neighbors.  We are
close to the end of phase two, which will be over when we pass papers at the
end of the month (God willin' and the crik don't rise).

The 3d Phase includes preparation of documentation for financing, finalizing
permits and zoning approvals; updating business plans and cost estimates
including operating budgets; assembling and coordinating the project team
(architect, engineers, designers etc.); assisting in negotiating contracts
between the cohousing group and the professional team; finalizing agreements
for the affordability components.  If environmental matters had been an
issue (always a possibility in a developed area) this phase would include
preparation of an environmental impact statement, etc.  This phase will be
complete when permits are obtained and when financing commitments for
construction are secured.

Phase 4 consists of design development and documentation.  The final working
drawings will be completed, design of units ("standard" and "upgrade"
versions) and the common areas refined; finishes decided upon, etc.  They
will assist in preparing the construction contract, reviewing energy
efficiency standards, and value engineering efforts.  This phase will end
when the building construction permit is obtained and the construction loan

Phase V will consist of construction oversight, with all the coordination
that involves, including keeping peace with the neighbors.  They will also
assist in preparation of condo/coop documents and arrange management
services if required.  Phase five will end when the City issues a
Certificate of Occupancy.

What is Not Included:  Fees of a third-party architect to complete working
drawings, etc in phase 4; fees of other professionals - engineers, lawyers,
etc.  All these bills are paid directly by the Cohousing group - our
Development Oversight Committee meets weekly with the Developers to go over
everything that is planned and approve expenditures, etc. These fees are not
included in the Project Cost on which the Developer's fees are based. In
addition to all this, they attend most of our multitude of meetings and act
as the first catch point for phone calls in response to flyers and brochures
we circulate.

We pay fee as follows:  Phase 1 - 0%;  Phase 2 - 25%;  Phase 3 - 15%;  Phase
4 - 10%; Phase 5 - 25%;  Holdback 25% - payable upon issuance of the
Certificate of Occupancy.

I hope this helps.

Rowenac [at] worldnet.att.net
Cambridge Cohousing

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