When Comparing Potential Land Purchases, Look Beyond the Land Price
When comparing competing sites for land acquisition, it is very important to analyze all of the site specific costs to make a true comparison. The price per square foot for the real estate is just part of the picture. It’s also essential to consider the project-specific costs so the sites can be compared side by side.
There are many different “hidden” costs that can apply to a site, but here are some of the most common.
What are Entitlements?
Entitlements for a commercial or industrial development include Site Plan and SEPA (State Environmental Policy Act) approvals from the agency that regulates the property. Typical site plans will show the proposed building square footage, parking and drive aisles for both cars and trucks, storm drainage facilities, landscape, buffers and setbacks. In some jurisdictions, SEPA may require a preliminary fill and grade plan. These approvals also require consultant studies, such as, traffic studies, storm drainage analysis and wetlands.
Site plan and SEPA approvals can be completed for an assumed maximum build-out of the site and the addendums can be approved by the agency issuing the original approvals.
Addendums allow the property owner to tailor existing entitlements to meet the needs of a development proposal when the opportunity arises. This saves time and allows more predictability in the process.
What Benefits do Entitlements Provide a Buyer or Tenant?
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