I got an email from an Architect in Florida looking to get started as a small developer.  She wanted to know how to pick a property to get her new enterprise started.   We always recommend that you think beyond the individual building and commit to the neighborhood as your project. Stake out a geographic area as your "farm"  the piece of town that you are going to know better than anyone else.  If you cultivate that farm, meet people, build trust with your neighbors and the folks who might oppose new construction , you have an edge that a big operator from out of town will not have.

Where should you look for your Farm?  No, I am not talking about an actual agricultural farm.  "Farm" is a metaphor for a neighborhood you are serious about cultivating long term.  Pick a place that you care about, that needs you.  For example, I really care about my old neighborhood; Prospect Park in Brooklyn -but Prospect Park, along with the rest of Brooklyn is booming.  So that place does not need me. Find a place in between where cool stuff is already happening and where things are still kinda lousy.  Work the seam.  If you can find a piece of a neighborhood that is on the seam between the two, you can have a significant impact and have real upside for the value of the buildings you build or renovate.

 Look for an area with multiple buildings to renovate and repurpose, or multiple vacant parcels to build new infill buildings on.  Map out your various opportunities, which properties are listed for sale.  For properties that are off the market, you dig into the local county assessor or recorder's office records to learn when the property last changed hands, are there any liens filed against the property, and who is the owner of record.  Sometime the County Assessor records are available online, but even if you use the online resource, go down the the assessors office and meet some people.  Learn how your local operation works.  Print out some physical maps to mark up as you walk or bike around your farm.

Commit to your farm. Buy a house in your farm, renovate it, and live there.  Look for something you might divide into a duplex or perhaps a small existing mixed use building where you could live in one unit rent-free while figuring out your farm.  Once you become familiar with what your likely rents, likely hard and soft costs to build or renovate might be you will be able to evaluate multiple properties and rank them for which ones you want to pursue first.  Working the project(s) on paper is the best way to get started. There is no risk other than your time and attention.

Get out and meet people.  Walk around.  Put your self in a place where you are likely to have some chance meetings, the farmers market, a coffee house, a neighborhood bar, a hardware store, a church, a community meeting, anywhere that helps you meet people who live and work within your farm.

 

I tend to let too many files accumulate on my computer desktop.  As I was clearing out files today I came across the photo above and the text below.  As you can see from the photo, we did manage to put on the first boot camp in Duncanville.  By the end of 2015 we had done six bootcamps and workshops and launched non-profit to coordinate the effort to cultivate Small Developers around the US, the Incremental Development Alliance (IDA).  Next Tuesday, June 7th in Hamtramck, Michigan we will running the 7th event of 2016 the day before the 24th gathering of the Congress of the New Urbanism starts up on June 8th.

In addition to running the one day and three day training events, IDA along with Midtown, Inc has been awarded a Knight Foundation grant to do a deeper diver into the Midtown neighborhoods of Columbus Georgia, providing 18 months of extended training and mentoring for local small developers.

None of this would have been possible without the hustle and hard work of local sponsors and volunteers in each of the cities that hosted us and the ongoing efforts of the IDA staff and board.  Strong Towns helped us get started, hosting the boot camp registration for the first couple events on their website.  Lynn Richards and the staff at CNU have been tremendously supportive as we continue to figure out how to scale up the Small/Incremental Development Effort.  The CNU's Project for Lean Urbanism was the genesis of this entire effort.  The time we spent with the Lean Urbanism Working Group exploring what it would take to Make Small Possible made it very clear that we need a new business model for development, That shifting the scale of the development enterprise was going to be critical to building better places.   Thank you everyone.

June 5, 2015

Things are moving FAST with the rapidly expanding Small Developer/Builders Facebook group that we set up last April prior to CNU 23 in Dallas.

I have heard from a number of group members via email and phone calls that they would be interested in a hands-on workshop on basic skills needed as a small developer builder. There is an effort percolating to hold a one day workshop for Small Builders in Atlanta the day before the National Town Builders Association (NTBA) Fall Roundtable October 16-18.

But that’s all the way into late October and folks are pressing for something much sooner.

I think we can put this together in the Dallas area rather inexpensively. If the folks attending cover their own travel, lodging and meals, if we can find a venue at modest cost. It could be a very Lean affair.  A meet-up with other folks considering or practicing as Small Developer/Builders. Connect with some mentors, roll up our sleeves and get some skills.

Here’s what we are thinking for content:

• BUILDING FOR-RENT VS. BUILDING FOR SALE PROJECTS.
• HOW TO DO BASIC MARKET RESEARCH.
• PRO FORMA BASICS, SORTING OUT YOUR DEAL ON PAPER.
• HOW TO BUDGET FOR HARD AND SOFT COSTS.
• OPERATING EXPENSE BUDGETS AND THE PROPERTY MANAGEMENT BASICS.
• SITE SELECTION – EVALUATE SEVERAL SITES TO FIND THE BEST ONE TO START ON.
• HOW YOUR FINANCING REQUEST LOOKS TO YOUR BANKER.
• NAVIGATING THE APPRAISAL PROCESS.
• HOW TO PITCH A DEAL TO AN INVESTOR.
• DEAL STRUCTURES; ALIGNING THE INTERESTS OF PARTNERS.
• POP-UP RETAIL AND STREET MARKETS; HOW TO CULTIVATE TENANTS (WHEN YOU HAVE NO MONEY).
• UNDERSTANDING FHA LOAN PROGRAMS 203(B) AND 203(K) FOR 4 UNIT PROJECTS.
• DEALING WITH CONSTRUCTION IF YOU DON’T HAVE A CONSTRUCTION BACKGROUND (AND EVEN IF YOU DO).
• COMMON SENSE DESIGN STRATEGIES AND WORKING WITH ARCHITECTS AND ENGINEERS.
• MULTIPLE ON-RAMPS, SCENARIOS FOR HOW TO GET STARTED AS A DEVELOPER/BUILDER.
• A STANDARD 4-PLEX DEAL; ALL RESIDENTIAL OR SMALL MIXED USE BUILDING.
• A STANDARD COTTAGE COURT DEAL.

What other content should we cover?

We are thinking folks would arrive in time for food and drink on Friday evening, leave after lunch on Sunday.  We are doing this on August 14-16,  Who’s in?

Warning! Planning Geek stuff ahead....

Most state have a law on the books that requires municipalities to adopt a Comprehensive Plan (called a General Plan in California) that will guide local investments in transportation, schools, parks, fire trucks, hospitals, and sewer plants.  Once the Comprehensive Plan (Comp. Plan) has been adopted, the municipality is supposed to revise their local zoning codes and development ordinances to bring them in line with the goals and policies of the Comp. Plan.  So the Comp. Plan is the big idea, the thoughtfully considered suite of policies that should guide the finer-grained rules and regulations that developers are required to follow if they want to build something.

Here's a common problem.  After going through a long string of cathartic public meetings, charrettes, visioning sessions, etc. to prepare the Comp. Plan, Downtown Master Plan, Corridor Plan, etc., the mere mortals that staff the local planning department or sit on the planning commission and the city council are kinda burned out.  The unglamorous task of revising the zoning code tends to get delayed or forgotten.  Sometimes there is  just no money in the budget to get the zoning code revisions done.

If developer shows up proposing a project that is in line with the general policies of the new Comp. Plan but violates the specific rules of the old zoning code, the only path forward is some sort of Planned Development Permit (PD), Planned Unit Development (PUD), or some similar additional process designed to allow greater flexibility that is allowed under the letter of the zoning code.  PD's and PUD's require require additional applications, additional review by the planning commission, and typically a public hearing.  In the meantime, if someone wants to build some crappy project that violates the policies of the new General Plan, but is specifically allowed under the old zoning code, they could do that as an as-of-right project. That's just bullshit.  Imagine how local residents who participated in all those visioning workshops for the Comp. Plan are going to feel when they see that crappy project get built.

I think that putting this statement on the front cover of every Comp Plan to save people a lot of time, money and frustration:

"WARNING! This is a feel good scam. We have no intention of actually changing the rules to allow you to build any of it without special permission and a number of public hearings with local residents who have not read this document."

If your community wants to see the vision of their Comp. Plan actually get built, get serious about changing your zoning code.