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Thursday, October 20, 2011

Real Estate Development Made Easy

Real Estate Development Made Easy
The idea of ​​a joint venture draws a lot of individuals and as a man who has developed $ 1.2 billion worth of real estate across all sectors, I get a lot of questions seeking advice.

There are so many reasons for entering into a joint venture, and if you go to the "JV" road think I have to make a few suggestions.

First and foremost we want to understand why you also think of joining a real estate development joint venture, because I do so with great reluctance.

After all, consider a joint venture must be another person's attitude, emotions, decision making, (or the inability to make a decision) whether they have a logical and sensible head ... the list goes on, oh, what their experience level?

It must always in a real estate development joint venture, a good 'Payback' for you ... actually for both parties.

    Whatever You paint is usually
    the reason for entry into a joint venture.

It would cover an age for me all kinds of real estate development joint venture, so I'll focus on a few.

For example: The other party can be a wonderful development on site and wants to develop it, but do not have the knowledge. They "love" the place and know that you could it a very successful and profitable real estate development.

Another example: Maybe two people have their accumulated capital, but individually the money is not enough to take on a project. The combination of capital and borrowing capacity, it is the real estate development joint venture to proceed.

Whatever your reason, the conclusion of a real estate development joint venture to do is ALWAYS second best, a real estate development by itself.

It must be clear why you are considering a development joint venture, and it must be prepared by a legally binding and real estate development joint venture agreement will be backed up before you spend a dollar.

A real estate development joint venture agreement specifies what each party will contribute, both in money and effort, and encourages each party's rights and obligations.

In addition, sets out what happens if the parties fall together, and for the sharing of profits or losses.

Note: There are a lot more at stake if you JV with your brother-in-law
or other relatives ... The term "On-going-nightmare 'is a phrase that comes readily to mind.

When a family breaks down real estate development joint venture, it does not matter how many pages to say in the joint venture agreement that one "right" were ... as far as your brother-in-law special fund, you are deleting an "expletive .......' I thought I would get that one out of the way!

One more thing: make a development joint venture with a wealthy person if you are many levels poorer, not too smart.


Well, in simple words, when push "comes ... Money Rules" on hard And you know the golden rule: If the GOLD, RULES has.

Even if the rich man tells you, do not interfere with a joint-venture agreement ... It seems that he / she save you money on legal fees and court costs ... tempting is not it? ...

What he / she really is doing, getting your legal rights. Yep, you have fewer rights than an employee. If that's the deal ... become better employees!

The fact is you have less money than him / her. Without joint venture agreement, you have no rights. I prefer a real estate development joint venture with the same man power.

Notice I did not say "the same skills." It is better if you bring both different abilities, hopefully aligned with the development of industry, such as legal, financial, real estate, architecture, engineering, construction, etc.

In the first example I have already mentioned, I had my first and only JV on the basis that the partner had a wonderful downtown corner location property with unobstructed views of the river.

It is important that it was I who initiated the approach to the partner, as I would have to satisfy a market need. So they had the land, and I had the skill development.

The next important point is that the partners to develop an office building, as I wanted, but lack the development skills. And both parties have the financial ability to do the development.

Can you see how this is the basis of a large JV forms? Bluntly in:

   First They had the land, they had financial capacity
   Second I had the skills I had financial capacity
   Third They wanted office space for their own needs
   4th I wanted to develop office space for my needs

We negotiated a 50/50 joint venture, where she realized half the office space from the ground floor, as they had a retail business need, and I took the upper levels has. We have both made available 50/50 cash. I earned a development management fee, as I worked all the development administration. And both partners worked well together for a successful outcome.

However, it is important to note that the entire place into a JV agreement, where it was clear what had to do both parties and to afford.

In the second example of two individuals to combine their financial resources, there is a tendency for both the money aspect, focus, and that's understandable.

I would suggest that they focus on the acquisition of development skills first. From my experience in teaching people how to be the developer, I for a fact that many people start out by buying some land and then start on a journey to know motivated by the question: "What do I do next? "

Professionals do not start by buying land, but also to do a beginner, but just amazes me.

It's a myth floating around the world, the development of competence are something that we all born with, as if it is only natural, just buy a piece of land, and we will know what they do naturally.

We all seem to be a guy we went to school, which developed a successful property and is white, but let's not forget he was not too bright at school, so if he can do it then, someone who is so intelligent how we can do even better.

So let us get away from intelligence and let's talk about industry knowledge. Development is a business like any other, and it has rules, regulations, procedures and processes. Given the cost and commitment required for the development, it is wise to invest in education at the beginning. You will be surprised and amazed at what I do to you before you buy on shore look like. Please note the development of training that I offer on my website, so you are prepared for success.

Finally on the question of money, is always the most important requirement for development financing in the creation of an economically viable development proposal. Yes, there are other problems, but all of them are involved in the creation of an economically viable development should, and that is what I teach you.

By definition, if you're not dealing with a financially viable, you will not have the money from any investor, partners, or sponsors. Want and logically, if you're not dealing with a financially viable development not try to go forward even with him.

If what I have said is true, and it is, then you can be the most important measure is to remove all elements that allow you to learn how to create an economically sustainable development. Part of the training that I offer is, how to prepare a feasibility study. and that's how I discovered and recommend on my website, the software of real data. It makes the calculation and presentation of performance data as simply and directly applicable, which must reach the developers.

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Friday, October 7, 2011

Investment For Home or Stock? Before it Analyze your financial advisor!

He / she maybe an agent in disguise for the real gamblers - builders, owners, brokers, Stock / MF dealers, bankers, manipulators of Dalal Street or Wall Street, etc. Keep aside the financial jargons, equity investments are not more than one " glorified version of traditional gambling. "

Chances are, if you think about investing in real estate or stocks, the first thing that comes to mind, an investment expert or a real estate professional is to ask the parent to your own common sense. Check out the property market as a critic and easy to calculate cash flow return (rental income) and future (ROI housing sales revenue).

Also keep straight the BSE Realty Index and other similar trends. While reading the recent global market crashes and about how manipulative the markets are generally long-term success is not so rosy for small investors more ... Many would take it differently, but that can not be the reality on the ground, right? See the early warning stories!

Under instructions from today's increasingly media can make important decisions to be a disaster, naturally. They are notorious for changing opinions as soon as the status of the markets. Forget what the Kotak, investment magazines, experts, magic bricks, Makaan, HomeWalas, NDTVs, 99Acres, Bankers, CNBC, 2letservices, consultants, real estate times, Yahoos, Googles, .. etc are suggesting, look at the local market conditions! Yes, there is no monarchy in today's digital world, but the basics of what Canakya or Kautilya said Arthasastra (read finance) can not be mutated by a few opportunists always. Why the market will grow in your favor? Find the answer before you jump in!

Historical returns are of little value in the formulation of expected returns, standard deviations and correlations: If the past are shown price movement of stocks / bonds or investing in real estate used as inputs, the outputs of the analysis of portfolios that performed particularly well in the past. If beliefs of investment professionals are used as inputs, we get the output as better or worse portfolios. Good and reliable advice add value through the continuous evaluation of the effects of alternative economic scenarios, investment planning, investment solutions and lifestyle choices, the administrative costs and a margin of safety advice in saving and investing your money. Anything less is a bad practice to fire him / her!

For many people their home is the biggest single investment they will ever make. But you have to remember before that, if you will a house to purchase it part of your overall portfolio of investments. It is one of the most important decision since it may play a dual role of an investment and passion to serve your daily life. While going to buy a house is one of the largest investments the average investor, there are other types of investments in real estate is worth investing in. The most common type is the income-producing real estate. Large income-producing properties are often bought by wealthy individuals and institutions, such as life insurance, real estate investment trusts and pension funds.

Income-producing properties are bought by private investors in the form of smaller multi-family homes, duplexes or even a single-family homes or condominiums that are rented out to tenants. Real estate is considered an alternative investment class, driven more speculative things such as stocks or bonds in comparison! The main difference is that real estate is an investment in 'bricks and mortar "of a building and the land. It is tangible, because unlike most shares that can see you, and your home, try it! This often creates considerable pride of ownership, but tangibility has its downside, because real estate requires hands-on manager. You do not need to mow the lawn of a bond or pull the toilet paper on your capital!

Some benefits of realty investment diversification, value, profit growth, inflation protection, the ability to influence the performance, etc. An investor can be many things to do around a house to increase its value or improve its performance, for example, replaced the leaky roof, improving the exterior and re-tenanting the building with a higher quality tenant. An investor has to be a greater degree of control over the performance of property funds as equity investments, which are driven to be highly speculative for the benefit of smart manipulators.
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