Our fair city wants to find a “developer” to renovate 8 townhouses and put them on the market. For the life of me, I can’t see a role for a developer here. The city owns the properties, will transfer them to the developer, who will then get them fixed up (by contractors) and put them on the market.
Or live in them, which is what a group that I belong to wants to do.
I’m not even sure we need a general contractor. For the houses that we’re already working on, there is one paid carpenter, and electrical, security, and HAVC subs as needed. The rest of the work is being done by group members for free — mostly demolition and rough carpentry at this point, but some of us have done roofing, sheetrock and finish carpentry, too.
I’m not knocking general contractors. I’m just wondering if a bunch of well-heeled and industrious urban homesteaders can make do without one, on a project of this scale. Thoughts?
P.S. It’s been a blast, so far. My first love is carpentry.
Replies
Your city (where are you) probably wants some formal structure and legal responsibility in the transaction. Why don't you incorporate and take on the role?
Whenever you are asked if you can do a job, tell'em "Certainly, I can!" Then get busy and find out how to do it. T. Roosevelt
Your city (where are you) probably wants some formal structure and legal responsibility in the transaction. Why don't you incorporate and take on the role?
Some of the folks in the group are forming an LLC and looking for a developer and general contractor, just so they have one of each in their Proposal.
My question is more along the lines of: What role is there for either in such a small project? Just trying to understand their respective roles -- and maybe talk the city out of asking for them -- I think the whole RFP is just public sector boilerplate, so there might be a chance.
Mike
The developer owns the property, adds value and sells it.
The GC, or General Contractor, holds and performs the contract for all work done for the HomeOwner. The HO can be the GC.
The subcontractor or specialty contractor, holds and performs specific work for the GC or the HO. Specific like electrical, hvac, concrete, framing, roofing, etc, etc, etc,
In your case, the LLC will be the developer, one of your group or the LLC will be the GC, and the developer will sell to a different corporation made of the group that will live there. Apartment style.
For a condo, the developer will have to set up the condo assoc's paper work and operating budget, and the group members individually purchase the units and collectively, thru the units, the condo corporation and holdings.
The developer is expected to show an SCA, (Specifications and Cost Analisys) for work to be done, a business plan for profit to be made, proof of funds to carry it thru.
Combine all these into one step and form a condo assoc with no holdings and drop the business plans part above. Have each member develop an SCA for their area of expertise. Figure on paying each member $50/hr for their labor. Find Jerralds Labor burden spreadsheet. Add up the numbers and 3x it, That's the #'s you use in the master SCA to the city.
Add up the retail value of all 8 units. Everyone apply for a preapproved mortgage for the average value. That is your proof of funding.
The condo assoc becomes the developer and the GC, and when you get your certificate of occupancy, the HOs.
Talk to the bank first. Talk to the council, tell what you want to do and ask them what they need from you.
SamT
Note that the above is just one of my pipedreams. st.
Note that the above is just one of my pipedreams. SamT.
A remarkably detailed and useful pipedream! Very much in keeping with my questions and concerns. Things are getting a bit clearer.
Most projects that I undertake just aren't this complicated.
Thanks!
>Why can't you disclose the proposal terms? It sounded from your original>post that this is a public event, involving more than one family on public>property. If the city is looking for a GC/developer, then isn't it public>knowledge? Anyway, if you have the time and the expertise, why not get>involved? You already have a vested interest since you will be one of the>tenants.
The RFP is public, but the details of "our" proposal are not.Competition and all that. The property has been acquiredby the city, but title will transfer to the developer.
I have both the time and the expertise, but not the money,to undertake the project myself -- the city would like to seeenough money to hire out all of the work, and I don't havethe financial resources, or the inclination, to pay others todo what I'd rather do myself.
Most of our group feels as I do, but the folks preparing theproposal that I mentioned are making an effort to try todo things the way the city would like.
I'm trying to understand why the city's way may make sense,at least from their prespective -- although I suspect that theactual RFP is an almost exact copy of similar ones issued formajor developments encompassing entire neighborhoods.
Mike