So, You Want to Build Something

In my 40 years as a commercial real estate broker, I’ve repeatedly heard incorrect information being given to people who want to build on their property. Advice that could cause serious problems should they proceed without further diligence.

What is the TRUTH about what you need to know before you make important decisions — and who can you count on to steer you in the right direction to ensure a successful project?

This column is written for those venturing into a building project for the first time.

Building residential is much easier than commercial. Relatively speaking, most people can build a house with few problems. But building a commercial project is a whole new ballgame.

Let’s start by coming in the back door – obtaining a Certificate of Occupancy aka CO in the industry. The CO is necessary before you can put any furnishings or equipment into any structure, be it a commercial or residential building. To obtain a CO requires working with a number of professionals.

Before you can do anything with a piece of land, you must make sure it is zoned properly, which is why the first question a seasoned realtor asks is what is your use for the property. If the land is not zoned properly for your use, you cannot start building. Zoning is the very first step.

There is not enough room in this column to begin to explain in detail all that must be accomplished prior to turning dirt. When the dirt is turned, you are about halfway home.

It would be helpful for you to understand who and what you need before purchasing land to construct a commercial building.

A civil engineer will get your zoning, your survey, your various studies required such as an Environmental Phase 1 study and wetland/endangered species study, DOT permission for ingress/egress, possibly a traffic study, water management certificates, water allocation and sewer capacity letters. These documents will then be used to obtain a Development Order or DO.

We haven’t talked about the bank, legal, and cost estimation for the horizontal site work and vertical construction. And somewhere you have to engage your architect to obtain building permits for the various phases. The “working drawings” are the final, “as built” plans that are stamped by all the various governmental agencies that must sign the plans prior to the start of any construction, like community development, fire safety, zoning, dot, water management district, county or city water and sewage departments and landscape planning department. Many of these steps are also needed for residential. construction. However, some of the problems of a single lot are resolved because of the nature of the residential district. Projects vary and I am writing this from experience without a checklist, but I want to instill in you the importance of hiring experienced professionals. Trying to do it yourself may very well end up costing you more in the long run.

Hire professionals: An experienced commercial realtor with real-life development experience, a land use attorney who can help draft development contracts, a civil engineer, a landscape architect, a general architect, a qualified experienced builder who has a track record of building your product, and a banker that understands the process from land acquisition to CO. These people will help avoid major snags which can cost time and money. Even with all of that and the best-laid plans, all projects will incur unexpected expenses, which is why it is paramount to have a contingency fund of 10%-20%.

Be sure to plan for the proper amount of time. If a zoning change for a small commercial building is required then it will take somewhere between 18 months to two years to complete the project, if there are no major problems.

Do not think you can get a deal by using cheap anything! You cannot save money by trying to cut the budget. Do it right the first time and you’ll save time and money and have a project you will be proud of.

Randy Krise, CCIM is the broker owner of Krise Commercial Group, LLC in Fort Myers and can be reached at 239 633 8672 or [email protected]