03 5332 6994

PURCHASER OF DEVELOPMENT PROPERTY

ALPHA ONE PROGRAM

Many properties are advertised and priced as “Prospective Development Site”. If a purchaser is not guaranteed of development approval by the local authorities, it begs the question how can a vendor or purchaser accurately settle on a fair and reasonable sale price?

When a property is marketed with development potential, is it a matter of Caveat Emptor, Latin for “let the buyer beware?” The basic premise is that the buyer buys at his/her own risk and therefore should examine and test a product for obvious defects and imperfections.

The real-estate agent has a duty of care towards the vendor they represent, leaving the purchaser as a Risk Taker and seeking to successfully negotiate with the vendor to become a Risk Maker.

Risk Taker Purchasers

  • Believe un-tested marketing and advertising puffery. In fact, the law considers “puffery as promotional statements which no reasonable person should take literally and can be exempt from rules relating to promises in open Contracts of Sale.
  • Believe un-tested statements of fact regarding property potential.

Risk Maker Purchasers

  • Understand the necessity of seeking out accurate intelligence about the intended property acquisition before committing to the purchase.
  • Understand the purpose of gaining property intelligence to formulate and calculate accurate acquisition and development risk.
  • Understand that risk is a necessary ingredient in establishing a fair and balanced property purchase price.

At KeyPoint we act as your exclusive Property Advocate, resourced to act in your best interest.

We also work closely with vendors and their real-estate agents to enable proper due diligence to occur in a timely manner and to ensure property listings are effectively interrogated.

In many cases, we can secure an exclusive Purchase Option from the vendor to enable the feasibility process to be fully completed and unimpeded to Business Plan stage and assess a fair purchase price for both purchaser & vendor as the investment risks are identified and mitigated.

The latest international standards are used to assess and, if necessary, re-package development acquisitions with accurate and informative documentation to ensure the project can be developed within accepted risk parameters.

Before purchasing real-estate for development, six questions need to be asked –

  1. Can a satisfactory Town Planning Development Approval be granted, within a reasonable time frame?
  2. What is the market demand for the property to be on sold after subdivision and at what future price elasticity is the market prepared to accept?
  3. Can the development approval & construction costs support a reasonable risk contingency and Return on Investment?
  4. Can you fund the project; Is the project attractive to lenders for both acquisition and development funding?
  5. How does this acquisition rank with other like projects and what is your ROI?
  6. Do you need an introduction to a well-resourced and experienced syndicate partner to assist with the project - to spread risk and development anxiety?

KeyPoint’s unique 12 Step Alpha One Program

The program first gathers property intelligence in order to identify and manage strategies in regards to development & construction risk.

Property intelligence reports can be prepared to quickly eliminate projects that are not suitable for successful development, that carry high risks and low profits before significant financial resources are committed.

It may also mean that following the profiling of the project development risk, the project can be re-engineered by the KeyPoint team to mitigate the primary risks and to maximise return on investment and return the project to produce a successful outcome.This is normally reviewed at the Feasibility Report stage

You also have the satisfaction that as the project is fully interrogated early in the process and at each milestone, other risks such as construction, lending, marketing & sales have also been fully considered in advance of acquisition.

If you are not satisfied with the findings in the Feasibility Report don’t speculate, walk away from the purchase and enquire with us about one of our pre-qualified projects that may better suits your risk- profit profiles. To register your interest click here.

KeyPoint is your exclusive property advocate to negotiate your next development project because we –

  • Have the strategic experience and technical knowledge.
  • Have the resources and knowledge to project manage real-estate development from feasibility to completion of the last sale.
  • Independently risk rate your project with our other comparative projects.
  • Package the project with a professional Business Plan which adds value to the project and makes it more attractive to a wider range of purchasers even if you decide you need to exit the project before completion.
  • Assess the property acquisition based on accurate development costs.
  • Secure your acquisition at the fairest price with best fit terms from your vendor.
  • One-stop shop for full development consultancy services.
  • Have the strategic experience and technical knowledge.