General financial information
-Selling Price $125 per sqft
-Leasable area : 220,000sq.ft
-Construction cost : $25,000,000(estimation from RSMEANS QUICK COST ESTIMATOR)
 |
| estimated construction cost of 1100 Trinity Mills *The developer does construct buildings by itself. Thus, he could save construction cost as much as he can. |
-Land Price : around $3,000,000
-Units Price
Unit
|
Sqft.
|
Price
|
1Bed, 1 Bath
|
700
|
$87,500
|
1Bed, 1 Bath, Den
|
1,000
|
$125,000
|
2Bed, 2 Bath
|
1,100
|
$137,500
|
2Bed, 2 Bath, Den
|
1,295
|
$161,875
|
2Bed, 2 Bath, Den
|
1,300
|
$165,000
|
Development Costs
| + Construction Costs (PSF) | $114.00 | $100.00 |
| x Total Square Feet | 220,000 | 220,000 |
| = Total Construction Cost | $25,080,000.00 | $22,000,000.00 |
| + Land Acquisition Costs | $3,000,000.00 | $300,000.00 |
| = Total Development Costs | $28,080,000.00 | $22,300,000.00 |
| - Governmental Rebates for Energy/Sustainability | $- | $- |
| = Revised Development Costs | $28,080,000.00 | $22,300,000.00 |
* The total amount money that the developer can earn from this development is $125x220,000=$27,500,000. Thus, if the maximum cost per sf of the construction is $100, and the vacant rate is under 19%, this project is worth to do.
Conclusion
When I heard about this project at first time, I was easily sure that this project's feasibility is very high. It is because the location of this condo is fantastic. There is the Super H-mart right next to 1100 Trinity Mills. 4 years ago, before H-mart did not open yet, around the shopping mall, that has H-mart now, was half empty. But, now the shopping center is full of tenants. And, apartments around this shopping center is very popular for Asians. Thus, average occupancy rate is over 95%. That is why I could determine the condo's location is really good.
According to my financial analysis, the project has a feasibility if the condos could be sold over 81%. Within 6 weeks after the development company(DIRA) started pre-sale, 88 units(61.54%) out of total 143 units have been sold. to sell condos. The developer have a plan to raise selling price. This project is about to start construction. It is supposed to start the end of April 2012.
Does this development project have feasibility? My answer is absolutely "Yes".
Good work identifying a population niche and government assisted program (CRA).
ReplyDeleteI appreciate your analysis summaries to assist explaining your project.
Well Ham, I'm posting again because all my posts from Wednesday were mysteriously deleted from each blog!
ReplyDeleteI had stated before that this development is right in my neighborhood and I will be keeping an eye on it. I live right down the road on Trinity Mills and can attest to the high volume and traffic surrounding the Super H mart. The market area has definitely created a community and magnetism to the area.
This development is very near to the Carrolton stops on the DART. It will be worthwhile to keep a watch on the types of developments that take place around these stops where existing property is available for new development or redevelopment.