At the Juncture of Real Estate and Technology

In Part 5 of the series, I want to share eight (8) real cases on small lot developments, primarily in Harlem, a vibrant neighborhood in Upper Manhattan. Here is a summary of these cases along with their estimated returns. IRR was not calculated due to difficulty in estimating development cash flow as well as reversion value. Address Type Project Return Equity Multiple Devel o pment Yield 310 W 114 ground-up condo 32% 1.6x 215 W 122 ground-up condo 36% 1.8x 126 W 130 condo conversion 53% 313 W 121 ground-up condo 54% 145 W 123 ground-up rental 6.0% 255 W 136 rental conversion 5.9% 63 W 130 co-living conversion 5.9% 81 W 118 rental conversion* 5.3% 310 W 114 Ground-up condo: the site was a 26’x101’ vacant land in a mid-block lot on a narrow street in R7A zoning district. FAR: 4. The developer built a 7-story 8-unit boutique condo building with a 26’x67’ floor plate and an elevator. No front yard and 34’ backyard. Front and rear setback is 15’ and 10’, respectively. Total saleable s...

  This is Part 4 of the Small Lot Development series. I want to share some information on the financial aspect of small lot developments. Each deal is unique and it is hard to generalize on cost and profit. The information provided here will give you an idea how a project achieves profitability. Please try to focus on the process of how developers create “value” through the development instead of the numbers themselves. Here are two examples: one ground-up condo and the other one rental conversion. Example 1 (ground-up condo): Existing 20’x100’ vacant land in a mid-block lot on a narrow street in the R7A zoning district. FAR: 4. Zoning floor area: 8,000 SF The plan is to build a 6-story boutique condo building with a 20’x65’ floor plate. There will be 6 floor-through units and each unit has roughly 1,050 SF saleable space (81% efficiency). Gross floor area 9,300 SF (7,800 SF 6-story + 200 SF penthouse + 1,300 SF basement). Front and backyard is 5’ and 30’, respectively. ...