My wife and I are planning to build a triplex or 4-plex on a lot we own.
We've talked to a couple of local architects, builders and developers. Tomorrow we are meeting with the town planner for an extremely early pre-application meeting.
This project is daunting, and we have a mixture of investment motivation, and desire to build a home we like. At some point, we will live in one of the units and rent the other two or three units. Right now the property is zoned for 3 units, but it's at least possible we could get a variance to add a 4th unit, which we think would increase the value of the property and help with cash flow. It's not all about an investment, but it's mostly about a good investment.
Does anyone know of checklists that other property developers use? Gantt style project management charts? I'd like to visualize this whole process.
Also, how would you go about vetting potential partners? A realtor/developer has strongly pushed one building company and architect team, another architect friend has a couple ideas for alternate partners. My thought is to get a reference from the builder, but also find people that live in homes he has already built and ask them for a reference without going through the builder.
For context:
-Building costs are estimated at $200/sf, which is low for our area, and we expect it could go higher to $250/sf.
-The rentals would positioned as a premium rental in our market.
-We are as focused on appreciation as we are focused on cash flow. These will cash flow, but perhaps not meet the 1 percent rule. We're okay with that given our local market, the favorable location of the lot, our desire to live in a unit, and our expectation that the as-built value will be 20 percent higher than what it cost to develop the lot. As a build and flip, we think we could come out ahead.
-The plan is to have an architect customize a design that the builder has already built. So builder has plans, we give them to architect, and he makes minimal changes so the build fits our lot. We want to go with a builder who has already built something similar.
-At this stage, we are ambivalent about design, and I think that will make us easy customers. For example, we aren't going to have a lot of change orders relating to fixtures because we mostly don't care about which fixtures. Instead, we would select fixtures with an eye to durability (tenants) and resale.
-Our town requires builders to jump through more hoops than other towns. This is not an anything goes environment. That said, there is pressure on the town to approve housing permits quickly.
What else am I missing? Anybody know of a really good blog on this sort of thing? And please, any flow charts, project management tools, checklists, book recommendations, send them my way. I'm trying to get my arms around this project.
