Land Cost Negotiations

The owner needs to be realistic in identifying the number of acres of land required to accommodate the initial construction. If the owner is planning to expand their facility the timing and the square footage of the building expansion needs to be identified. It is always prudent to plan for at least 25% to 35% more building square feet of expansion plans than initially thought to have been required.  This is to accommodate faster growth than anticipated. It is best to identify 3-4 Municipalities that can be considered for the expansion.

The owner needs to also consider:

  • How many miles, and in a larger metro area what is the drive time the existing employees are willing to travel from home to work?.

  • Might the owner consider “Flex time” working hours for key employees?

  • Might the owner consider a 4 day work week?

Develop a competitive atmosphere among the 3-4 cities making sure each city is really a viable option to consider.

Land Consulting Services:
  • The first consideration should be to verify the current zoning is the correct for the markets best opportunities.

    • Commercial for office or retail is likely the highest in generating income for the future.

    • Manufacturing would be the next highest for income producing priorities.

    • Warehouse zoning is generally lowest in income.

    • The presence of utilities is a high consideration.

    • Gas is expensive to bring to the site.

    • Electrical needs are basic.  In most cases if single phase power is available but three phase is not at the site it usually can be brought without any issues that impact the cost of the property.

  • The next consideration is the topography of the site.

    • A flat site will usually require more expense to the project.  This is especially true when dock high warehouse needs are important.

    • Generally speaking, it is best to have some natural fall.  This allows the site work sub-contractors to “cut and balance the site” and increases the flexibility for relocating dirt to accommodate the user’s needs.

  • The next consideration is to be certain there is land available on the adjacent site to acquire or right into the contract a clause for first right of refusal at a price locked in  case potential user’s need additional property for expansion needs.

  • The next item to verify is to determine the cost for Impact Fees for each of the Municipalities being considered.

    • Development impact fees need to be determined.

    • Utility impact fees need to be determined.

    • Parks and Recreation fees need to be determined.

    • Determine if the Municipality has any other fees that have not been identified.  Some of the smaller communities may have “frontage fees” vs. Impact Fees.  If so, these need to be determined.

  • Each City should be asked if Economic Development Incentives are available and if so what are items included.

  • Does the City offer Tax Abatements for 5 years minimum at one level and a lower percentage for years 5-10?

 

 

  • Are 380 Grants utilized that allow the City flexibility in reimbursement of various items:

    • Bringing utilities to the site.

    • Reimbursement of unusual costs to build on the property because of expansive soils?

    • Are there provisions to allow the City in question to reimburse the user for fire hydrants required or bringing the fire line from the property to within 5’ of the building?

    • The use of 380 Grants offers the City the most flexibility in negations with the user.

    • Will the City be able to waive certain fees or costs as part of their Economic Development Incentives? 

Contact Us

 Address. 823 Doral Drive Mansfield, TX 76063

Tel. 817-689-6775