What a packed week! Tuesday saw me back in Sheffield for a fantastic monthly meet up with the Development Discovery crew. A few days back in East Lothian working on recruitment and our SA business, followed by 3 days at Progressive Towers for Chris and I learning about Business Systems with Jason and Ray.
With such a busy week of content there’s too much to share in one post but here’s a few highlights from our Development Discovery Day which may well be of value to all the budding developers out there.
We started the day with a mini round table mastermind where each member updated what they’ve been working on the last month, any challenges faced and their learning objectives for the day. Common learning points to cover were:
- how to go from outline to full planning
- how to deal with lapsed planning
- targeted commercial
- optimising existing owned land
- how to do vendor finance
- Cohort updates
Each project group updated the room on the progress of their development site. In our case we are going through a pre-application process to optimise our site from 11 to 14 apartments. This is a snapshot of our discussion on the progress of planning and the new design:
– Our mentor Alan felt the revised design will sell much better.
– In regards to previous challenges of massing and scale- this has been addressed with the following adjustments from our Architect:
- Upper floors have been set back so its less imposing
- The roof line has been lowered with a flat roof so there is not any mass above the original height of the first planning design (*annoyingly there are not any ratios or anything to determine massing, it’s very subjective.
- A vennel between the front 2 blocks has been created to open up a coastal view for the apartments at the rear of the development which will add to the value
- The ground level where the footprint of the building will sit will be lowered by half a metre helping to reduce the scale and massing. The ground level will then be feathered away to level it out and we will install French drains (essentially soak away drains that prevent ground water from flowing towards a building) around the perimeter of the building.
- The overall design palette of the building now looks really sharp using grey Trespa panels https://www.trespa.com/
- The balconies have been redesigned so will be easier to construct and drain rain water
Overall a super insightful exercise to go through these planning issues and work towards something that should ultimately be granted planning because the design has been informed by feedback from the planner.
When, rather than if, planning is granted it will raise the valuation of our site as it is and of course dramatically increase our projected GDV. Very exciting and fingers are firmly crossed.
Alan later walked us through some key principles of vendor finance which has worked extremely well for him to create win win outcomes on several sites. As a little insight, one of the key things is to do your homework and go to meet the vendor equipped with a project folder containing details of how a potential site scheme could work, good comparables, a site valuation and any helpful insights informed by the local plan affecting the area.
What you are essentially doing with vendor finance is minimising risk by speaking to the right people to eliminate as much guessing as possible, and ultimately create a fantastic win win scenario whereby the vendor can achieve the price they want (and more), while you minimize risk and create a fully self funding development. This strategy can work extremely well with commercial sites that might be costing the owner money (i.e. if it has a struggling business).
Here are some key things you can look for:
- Empty buildings
- Failing pubs and hotels
- Sites that have been sitting on websites and not selling for months
The other key ingredients to this are approaching the vendor with a problem solving mindset and being completely honest throughout.
We used the remainder our time in Sheffield for a mini mastermind session focused on helping one of our cohort members brainstorm possible options for a large country hotel site with land.
It’s now Sunday morning and after a fun night out with the group from our Business Cashflow Masterclass, we have the final session at Progressive Towers with Ray and Jason before we drive back up the road to East Lothian.
Have a great week ahead.