VENDORS OF DEVELOPMENT PROPERTY
BETA ONE PROGRAM
If you own property that has development potential, you may wish to avoid becoming a PRICE TAKER by first becoming fully informed of what a typical purchaser is looking for in a property such as yours. Uniformed vendors run the risk of selling their property for less than its true value or ask for an unrealistic price, causing the property to linger as distressed, creating the market expectation of significantly discounting the sale price.
At KeyPoint our Beta One Program has been specifically designed to assist property owners to professionally prepare their property for sale by calculating a reasonable asking price that can be supported at point of sale with factual information.
Property owners now have access to an alternative by electing to fully or partly develop their own property, hand in hand with the KeyPoint team to further support an increase in the asking price. This unique program commences with detailed Property Intelligence reports, and can also identify the most financially beneficial time for the owner to on sell the property before it is fully developed. Most beneficial, other KeyPoint clients can be introduced to such projects giving the purchaser a fair selling price with a known settlement date for development potential property and shovel ready projects.
Price Taker Vendor
- They can sell their property at the highest possible price by taking short cuts without the preparation of proper commercial feasibility assessments and a business plan. Astute purchasers understandably need verification of their purchase, to ensure the project, once developed, can achieve their anticipated targeted ROI for the risk they are asked to take.
- They can assume their sale price based upon comparable property sales without knowing the actual cost footprint of the individual property. In reality every project has a very different cost-benefit footprint.
- They expect the purchaser to form their own view and cost assessments that underscore the perceived viability of the project and reflects the anticipated sale asking price.
- Why would a vendor rely upon the varying expertise of a purchaser, to establish their best sale price, when it is in the purchaser’s best commercial interest to use development impediments (manageable) to suppress and drive the purchase price down?
- They unrealistically expect real-estate agents to sell their property at the maximum price without providing supporting accurate and professional feasibility reports - Noteworthy there is a good reason why buyers don’t purchase motor vehicles without roadworthy certificates!
Price Maker Vendor
- Their property value is driven by two primary factors;(i) The underlying property kerb side value [excluding development potential](ii) The value prescribed for development potential. [This is where the vendor has opportunity to maximise their sale price if development potential can be adequately prescribed]
- The actual value of development potential can increase the underlying asset sale-price significantly if professionally packaged.
- The value of development potential is verified only following assessment of a development feasibility report using accurate development cost modelling.
- The difference between a successful and a marginal project is inevitably found in the business plan prepared by our KeyPoint team where project risk is identified and often mitigated with practical strategies to repackage the project. This strategy can improve commercial viability and consequently the legitimate selling price.
- Property development values appreciate incrementally as the Development Approval process is advanced. Conversely , a reduction in commercial risk for the purchaser also occurs.
- The Beta One Program identifies when the maximum sale price for the Vendor coincides with when the risk is minimised to the purchaser, eliminating the commonly experienced looser/ winner outcome that occurs with many such transactions.
- If you don’t happen to have a purchaser in waiting, KeyPoint has purchasers generally ready to commit to development potential and shovel ready projects, such as builders and developers who are always looking for KeyPoint certified projects to either purchase outright or form Joint Venture Partnerships using the Eta One program.
- The Beta One Program allows vendors to work with us prior to marketing their property.We start with rigorously testing the feasibility of their project and manage every step to completion including town planning, and introductions to our purchasers who seek a range of suitable development projects. This gives vendors the choice of selling when their property reaches its optimum selling price during the development process. For more information visit our Building Contractors page, Gamma One Program.