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June 2, 2008
Building Condo's - Are my "Ball Park Est's" on Construction Cost Close?
Hi All,
I have "a friend" who owns vacant land in South Slope and is considering developing the land. It's a 25x100 lot and with its current FAR can be developed to around 6,000sf.
Without getting into too much detail, any construction experts out there who could offer a very "Ball Park Estimate" on the construction costs? Assume:
3 story (or 3.5), 6 unit walkup Condo at around 6,000 SF (6units x 900sf + common). Mid Range interiors/fixtures (nothing highend, but nice), no parking but a finished basement (for storage, mechanicals etc). Central air.
I'm thinking this could be done for around $150sf (excluding Architect/Legal)
Any Estimates on Architectural fees?
Legal/Condo Plan Fees?
4% Sales Commission?
Any help or suggests are welcome. Thanks for your time.
Comments
$150/SF?!!! Try double that.
Posted by: johnife at June 2, 2008 2:53 PM
ROFL, $300/SF! and excluding the Land, Architect and Legal for the construction of a Mid-Range "walk-up". The Land alone cost $900k, so that's another $150SF. Throw in Architect and Legal, you are stating $500SF!
No offence John, but I'm looking for posts from people who have the experience and know what they are talking about, not random postings.
Posted by: polatbo at June 2, 2008 4:24 PM
polatbo, maybe someone with construction experience will weigh in, but jonnife knows that a rehab, not construction, will generally cost $150-$200 psft.
Don't laugh at $500 psft. If you sell at $600 psft, not out of line for the South Slope, you are making a 20% profit. What's wrong with that, especially if you are using borrowed money?
You're not gonna have the economies of scale that an experienced large developer will have. There's not exactly a shortage of South SLope new condos either, in case you haven't noticed.
Posted by: denton at June 2, 2008 4:47 PM
Ummm, did you check my profile to see what I do for a living (and my history of being within 5% of the bid numbers every job I've estimated is virtually unblemished)? It's you who's living in a dream world, my friend, unless you're planning on building it out of cardboard.
Posted by: johnife at June 2, 2008 4:50 PM
I think you're looking at considerably more than $150/sf for new construction. An insurance company estimated $130/sf for my ex-partner's conversion of a four-story Brooklyn industrial building and that was back in 2004 and conversions are a lot cheaper than new construction.
Posted by: Steve at June 2, 2008 4:56 PM
I didn't intend to offend you Johnnife, I apologize. I just didn't like your post without any comment or substance. Maybe I just didn't like your number :)
I'm certainly no expert but I've been around enough to know a basic 3 Story walk-up is not going to cost you well over $2 million to build.
Denton, I'm aware of what's going on in SS and I think even $600psft is pushing it for a mid-range built Condo, which is why I am laughing at $500. Factor in a 4% commish, interest to carry the construction and tax, then it's barely break-even.
If using the "top of the market" numbers in a place like New York City don’t add up financially....then the numbers must be wrong.
Thanks for the posts, appreciate it.
Posted by: polatbo at June 2, 2008 5:27 PM
The thing is, polatbo, that concrete, copper, steel, appliances, tile, and so on, cost the same whether you build in Manhattan or the South SLope. If your friend owns the land free and clear tho, surely there is a profit to be made.
Posted by: denton at June 2, 2008 6:05 PM
Denton, I guess I was trying to say that if you can't make it work in (Brooklyn) @ $550 or so psft and everything costs the same wherever you are....then you wont make it work anywhere in the country. It doesn’t explain the thousands of unit that have and are going up.
Yes the land is free and clear, sounds like the consensus of this board is to simply sell the land "as is" and walk away with almost as much as developing it.
Posted by: polatbo at June 2, 2008 6:13 PM
Check your area calculations. I don't think you're taking into consideration rear and front yard requirements. I think our floor area is going to be less than 1800 sq. ft.
Also, new construction, for every 3 units I belive you need 1 parking spot. (don't hold me on that though).
You really should take with a zoning expert, not 'guests' on a blog.
Posted by: guest at June 2, 2008 6:21 PM
Goes without saying regarding guests on a blog. I've done considerable research and gone down to DOB a few times.
With the current lot size you could easily get 5400sf, more if you go to the max partial 4th floor. These homes must comply with the Row homes, so there is next to no front yard. You dont need parking with a building of 6 units.
Anybody have experience with Architects? How is it priced? ( I heard it's often x% of construction cost)
Thanks again.
Posted by: polatbo at June 2, 2008 7:12 PM
Contact the agent you would like to hire--that information should be part of the 4% comm. An agent who knows about new construcion/new developments will know these numbers right away....
Posted by: guest at June 2, 2008 8:28 PM
$300/ft to build IF you are an experienced developer. IF you are not… expect to pay for your inexperience. Yes and then the land costs… and soft costs… and im sorry but in this market …. Low end walk up in the south slope… NOT selling at $600/ft.. (high end… luxury elevator high floor amenities packed buildings aren’t moving at $750/ft in downtown Brooklyn or way better locations!).
And… you don’t really have 6000 sq ft to sell… you will loose about 15% in halls and common areas… You still have to build them… but you don’t get to sell it.
And a 4% commission is not competitive in this market. You won’t solicit broker participation with a 2% commission… the bigger sites are offering 3,4 and 5% SALE side commissions (oh and the perfunctory ipod’s and free trips to Miami… Broker are heavily courted these days!).
So yes as someone points out above… even if the land is free you can’t build and sell for a profit in the south slope or in a lot of areas in Brooklyn. That will of course in time obviously correct the over supply and prices will get tight again. But for now…
Posted by: guest at June 2, 2008 9:37 PM
My advice: find some recent developments that are similar in size and quality to what you are looking to do. Go on nyc.gov and look up who the architect is on the building permits. Contact 4 or 5 of them to interview them and get some figures.
They will tell you what it costs to build what you want to build. It's very difficult to get a number without details and the range of estimates will vary widely.
To further your point that it can be done cheaply, there are plenty of people building lower end homes farther out in brooklyn (fedder's specials) for well under $200/ft - they often sell for around that. Often times you can make the right aesthetic choices to make a property stand out without spending an arm and leg more.
Posted by: guest at June 3, 2008 5:01 PM
You could expect an architect's commission to be in a range (depending on extent of services offered) from around 10% to 12%.
As to construction costs, on this small scale $150sf might be possible, but the quality of the building would reflect that price. $250-300 seems more realistic
Posted by: Smokychimp at June 3, 2008 5:40 PM
That standard for architects on multi-family residential is per square foot, not % of construction. I would factor about $400/sf for construction costs on residential these days. maybe slightly more because your lot is very small. But you can sell the thing for $1,000/sq. ft. so there's a profit definitely.
Posted by: guest at June 3, 2008 11:16 PM
Oh and as to 6:21's comment, there is a waiver for required parking spots if there are less than 5 required, and the density of the zoning is R6 or greater, and Quality Housing standards are followed.
Posted by: Smokychimp at June 4, 2008 5:54 PM
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