At the Juncture of Real Estate and Technology

I try to write on topics that I am interested in but cannot find good books or reads on the internet.  Evaluating real estate development deals is definitely one of those subjects.  Here is how I evaluate residential deals for value-add or ground-up development in a 5-step process: Market Analysis, Development Concept, Preliminary Due Diligence, Financial Modeling and Returns.   Step 1 - Market Analysis Market analysis is usually the first step of any deal evaluation. It will provide a lot of useful information, such as area insights, demographics, product type/design, comps, etc. The most important information to a developer is probably the supply/demand and comps data of the specific product that you choose to develop. As legendary real estate entrepreneur and investor Sam Zell highlighted in his book Am I Being Too Subtle that real estate business follows the simple law of supply and demand! Here is the thought process on how I develop the supply/demand and ...

  There are roughly 3.5 M housing units in New York City. Two thirds of them are rental housing. Clearly a majority of people rent. Multifamily rental is a big part of real estate business in NYC. Significant capital (domestic and foreign) continues to flow into this sector. But there are investors who are hesitant to enter the market. A lot of it has to do with cumbersome rules and regulations around rental housing and many of them are unique to the city. Here are some basics about the business addressing many of the common questions. I hope the information will help clear some concerns due to unfamiliarity about the sector. Type of Housing There are regulated and unregulated housing in New York State. Rent control and rent stabilization are two types of regulated housing. An unregulated apartment is considered “free market” or “market rate” unit. Rent control (RC) limits the rent a landlord can charge for an apartment and significantly restricts the right of the landl...

  A number of investors asked me if anyone at the choice of current tenant can take over the lease on a rent stabilized or controlled apartment in NYC, regardless if she/he is a family member or has stayed in the unit as her/his primary residence. This is obviously a very important question for investors to assess their assumption and risk of their investment in such property. Here is some information that could help answer the question.  The New York State Rent Stabilization Law gives certain occupants of rent stabilized or controlled apartment the “succession rights” to the unit. You can find the details from DHCR’s website  here . To qualify for the succession rights, there are a few conditions that have to be met:  The apartment The primary tenant on the lease The occupant claiming succession Minimum co-occupancy period The apartment The apartment needs to be rent stabilized or controlled unit regulated by NYS Rent Stabilization Law. To find out if your building ...