"Safest money investments"
There are few human creations that require nearly as much planning as land development. To meld with the environment and surrounding communities, raw land must be architected for form and purpose, prototyped, reviewed and researched for potential issues, subjected to numerous tests to ensure engineering soundness and finally approved by numerous governmental agencies and other interested parties. And all of this must take place before the first shovel breaks ground!
It is through the stages of land development that professional land developers add value to and unlock the hidden wealth in raw land, typically increasing its value by 3-5 times on average.
STAGE TWO: In the next stages of land development, once available raw land has been identified in the path of growth, the land developer will negotiate favorable terms for acquiring the raw land. There are a number of ways that a land developer can acquire raw land, but the two most common are:
a) Purchasing the raw land upfront.
b) Negotiating an "option to purchase agreement" in which the land developer obtains the rights to buy the raw land by a set date at a set price by offering a non-refundable deposit.
IMPORTANT: Investors are typically sought at this stage to help fund the acquisition of the raw land and cover costs associated with land development stages 3-5 below. These investors will typically be 'silent' partners with the land developer in the land development project.
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STAGE FOUR: The proposed plans are submitted to the city, county, state and federal governments for necessary approvals in the next stages of land development. This is known as "The Entitlement Process" and involves all of the critical sign-offs and approvals required for the newly proposed use of the raw land.
IMPORTANT: In these stages of land development, the land developer is literally "creating value" by gaining the approvals to utilize the land for a higher economic purpose and this is why land development can be so profitable. It is this entitlement process that creates an average 300-500% increase in the value of raw land!
The increased value of the newly "entitled land" results from several important factors:
c) Fully approved or 'entitled' land is ready for immediate construction, giving builders and contractors the benefits of accelerated cash flow and returns.
Each of these factors helps make land development projects among the most lucrative and secure high yield investments available today.
Here are examples of local government approval processes. i.e. The "Entitlement Process":
* Part One
* Part Two - Residential
* Part Two - Commercial
STAGE FIVE: By the final stages of the land development process, following the entitlement process, the original value of the raw land has typically been increased by 3-5 times what the land devloper paid for it. And in some cases, even more, by the addition of "infracture" improvements such as: access to utilities, municipal water, sewer, roadways, etc. Lastly, the newly "entitled land" is sold by the lot or parcel to building contractors and other real estate developers.
RESULT = average of 300-500%+ increase in land value!
Land Development Process is completed.
Profits are realized and Investors are paid.
Ultimately, the builders take over:
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For More Information click on these links:
4 Reason to Invest in Land Development
10 Growth Markets for Land Development
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Land Development Process
Step-By-Step
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