I used to get very excited when an agent called me to say...”Jo,
I’ve got a great DA approved site coming up...”
My little heart would pound as
I’d eagerly keep checking my emails for the plans and consent to come
through.
As soon as they did, I’d open the consent file first and
scan the conditions. Any weird and
wonderful requests would jump out at me like “...the developer shall construct kerb
and guttering, construct and gravel the road shoulder, place a two coat hot
bitumen seal to road shoulder...” that’s a really bad one. It could mean up to 50 lineal meters for
kerbing plus road works! This condition really gets up my nose as
council are basically off loading their road cost to us.
Next, I’ll scan to the Council Contribution condition, the
Section 94 as it’s called in NSW. This
can vary greatly from council to council and sometimes it’s reasonable, but mostly
it’s highly unreasonable. All these conditions
need to be allowed for and are on top of the construction costs. And, they won’t add any value to the
project.
Once satisfied with the Consent, I’d close that pdf and
venture onto the others...
Usually the files I
receive of plans are bad scans that the agent has tried to do off the large
format plans he/she’s been mailed by the vendor. I can just picture them trying to fit the big
plans onto their scanner, capturing the vital bits. If I’m lucky enough to make out the designer
at the bottom, I’ll pick up the phone and call them to discuss the plans and
get a decent lot sent over; in particular I’m looking for the stamped plans. If they are not stamped then they may not be
the final plans and I could be wasting my time.
When I have a decent set of plans to review, the first thing
I look for is the fall on the block. Is
it a flat block or are we going to need lots of site works and retaining? Then my eyes would scan over the floor plan, and
then skip down to the bottom of the plan where they usually mark up the gross floor
areas. Are the villas big enough? Are they too big? I’d check the site plan and look for the
little compass rose which will tell me the aspect of living spaces. North facing is good. On first glance, most plans may look ok.
Then I’d forward all the details I’ve been able to find onto
my builder for an estimate.
In fact, this is
exactly what happened this week as I looked at a DA approved dual occupancy
site. Then came the call from the
builder...”Jo, I’ve got the cost in” he’d explain and I’d hold my breath with
my analysis spreadsheet open on my computer, waiting, ready to drop in the
number, the magic number. Bang, there it is, the moment of glory...or
defeat.
Today it was a big noooooo that echoed through my mind (and
my office) as I watched the bottom line, the most important line of the
spreadsheet, turn red. The bottom line
of my spreadsheet shows the estimated equity that could be created for my
clients from the development. Red is not
good. This DA approved site was overpriced
and been ill designed. It simply did not stack up. The designer had created a
plan that was unfeasible to build. After a few curses, I return my focus to finding a raw site,
one that we can work on from the beginning to get the best results from.
As a developer, it’s important to cross check the cost of
your design before you lodge your DA. Sounds straight forward right? But most DA approved sites I come across are
on the market for one reason. They don’t
work.
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