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Land Development Overview
The industry’s bible. Nine chapters cover everything you need to know from initial market studies to site selection and analysis. New and innovative design ideas for streets, houses, and neighborhoods are included.
Back Cover
Learn the basics of land development through expanded and new chapters that cover:
- Market study and analysis
- Financing
- Feasibility analysis
- Site selection and analysis
- Environmental regulations
- Stormwater management
- Site engineering
Also included are exciting new design ideas for residential streets, housing types, and master plan concepts, which have influenced development in recent years.
These features, along with a summary land development checklist, make this book indispensable for any developer, builder, or student wanting to understand the fundamentals of land development.
Land Development Contents
Contents
Figures,
xi
About the Author, xv
Acknowledgments, xv
Disclaimer, xvii
Introduction
1
The Process, 1
Where to Begin, 3
Key Elements, 3
New
Complexities, 5
The
Project Team, 6
Market Research and Financial
Analysis
Consultants, 7
Project Planner, 7
Auxiliary Advisers, 7
The Developer, 8
Future
Homebuyers, 8
Chapter
1 The Market Study, 10
Why
Do a Market Study? 11
Purpose
of a Market Study, 11
Types
of Market Studies, 12
General Studies, 13
Site-specific Studies, 14
Highest-and-Best-Use Studies,
14
Target Market Profile
Studies, 15
What
Kind of Study Do You Need?, 15
Housing
Supply and Demand, 17
Housing Mix, 18
Projecting Demand, 18
Adjusting the Projection, 19
Sources
of Demographic Data, 25
Census Data, 25
Other Sources of Demographic Data, 27
Data Vendors, 28
Capture
Ratio, 28
Understanding
the Target Market, 29
Psychographic Data, 29
Sources of Psychographic Information, 31
Specialized
Knowledge of the Target Market, 33
When to Use Specialized Information, 33
Sources of Specialized Information, 34
Project
Viability, 35
When
to Study the Market, 35
Before Land Purchase, 36
After Land Purchase, 37
During Project Build-Out and Sales, 37
After Project Completion, 38
When
to Purchase Market Information, 38
In-House Market Studies, 39
Professional Market Studies, 39
Continue
to Market, 42
Advertising and Other Marketing Activities, 42
Selling
the Project, 43
Selling to Builders, 43
Selling to Homebuyers, 44
Today's
Marketplace, 45
Chapter
2 Financing Your Project, 46
Dramatic
Changes in Development Financing, 47
Sources of Capital, 48
Increased Documentation Requirements, 50
Types
of Loans, 54
Acquisition Loan, 55
Development Loan, 57
Construction Loan, 58
Permanent and Interim Financing, 59
Alternative
Sources of Financing, 60
Partnerships and Investors, 60
Joint Ventures, 61
Pension Funds, 62
Types of Land Purchase Agreements, 62
Analyzing
Cash Flow and Profit, 65
Pro Forma Analysis, 65
Cash Flow Diagram, 68
Sensitivity Analysis, 68
Profit Analyses, 72
Accuracy of Methods, 73
Future
of Development Financing, 75
Chapter
3 Site Selection, 77
Two
Approaches to Site Selection, 78
Development Idea in Search of Site, 78
Site in Search of Master Plan Concept, 80
Three
Types of Site Characteristics, 81
Physical
Factors, 83
Geotechnical Conditions, 83
Topographical Conditions, 88
Site Features, 90
Hazards, 94
Improvements, 95
Site History, 96
Legal
and Political Factors, 96
Zoning, 97
Growth Management, 98
Comprehensive Land Use Plan, 99
Subdivision Ordinances, 101
Contiguous Property, 102
Overlapping Regulations, 103
Political Factors, 104
Off-Site
Factors, 107
Negative Off-Site Factors, 107
Special
Studies, 108
Environmental Impact Studies, 108
Stormwater Management Plan, 109
Wetlands Review, 109
Traffic Studies, 111
Tree Surveys, 111
Sources of Information for Special Studies, 111
Geographic Information Systems, 112
Evaluating
Preliminary Site Data, 113
Organizing Site Data, 114
Decision Matrix, 114
Starting with the Site, 120
Site
Selection and the Target Market, 120
Chapter
4 Site Analysis, 122
Gathering
Additional Data, 123
Project Design, 123
Project Costs, 123
Site
Analysis Tools, 124
Current Maps, 124
Drawings and Tests, 125
Land Survey, 125
Physical
Factors, 126
Topography, 126
Soils and Subsurface Conditions, 129
Hydrology and Drainage Requirements, 131
Stormwater Runoff, 135
Site
Features, 135
Project Opportunities, 135
Project Constraints, 140
Regulatory
Requirements, 143
Zoning, 144
Subdivision Review Process, 148
Environmental Approvals, 149
Building Codes, 152
Off-Site
Factors, 152
Streets and Sidewalks, 153
Utilities, 153
Applying
Site Analysis to the Master Plan, 155
Producing Multiple Solutions, 155
Selecting a Final Concept, 158
Chapter
5 Major Environmental
Regulations Affecting Development, 160
Transforming
the Physical Environment, 160
Regulatory Climate, 161
Creative Alternatives, 162
Environmental
Permitting, 162
Reviewing Project Impact, 163
Submittal Process, 163
Key Areas, 166
Wetlands,
166
Regulations, 166
Project Impacts, 169
Hazardous
Wastes, 170
Regulations, 171
Project Impacts, 172
Water
Quality, 173
Regulations, 173
Project Impacts, 174
Air
Quality, 176
Regulations, 176
Project Impacts, 177
Noise
Control, 177
Regulations, 178
Project Impacts, 178
Radon,
179
Regulations, 179
Project Impacts, 179
Plants
and Wildlife, 182
Regulations, 183
Project Impacts, 183
New
Approach to Development, 183
Marketing the Environment, 184
The Green Developer, 185
Recognition Programs, 185
Environmental
Awareness, 186
Chapter
6 Developing a Master Plan
Concept, 187
Initial
Idea, 188
Unified Master Plan, 188
Community Identity, 189
Site Characteristics, 190
Target Market's Preferences, 191
Regional Context, 193
Sense
of Community, 194
Social Interaction, 194
Automobile and Pedestrian, 196
Privacy, 198
Choosing
a Concept for a New Development, 201
New
Design Ideas, 201
Traditional Neighborhoods, 202
Smaller Developments, 204
Creating a Unique Place, 206
Finalizing
the Master Plan, 209
Development
Guidelines, 210
Architectural Guidelines, 210
Deed Restrictions and
Covenants, 212
Construction Guidelines, 213
Master
Plans of the Future, 213
Chapter
7 Site Engineering and
Stormwater Management, 216
Site
Engineering Plan, 217
Components, 217
Master Plan, 218
Grading Plan, 219
Stormwater Management Plan,
219
Erosion and Sediment Control
Plan, 220
Grading
Plan, 220
Cut and Fill, 220
Spot Elevations and Slopes,
221
Code Compliance, 222
Microengineering Process, 223
Stormwater
Management Plan, 225
Principles, 227
Types of Systems, 228
Design of Closed Systems, 230
Design of Open Systems, 234
Combining Open and Closed
Systems, 236
Stormwater
Drainage Plan, 238
Site Drainage Patterns, 238
Rational Formula, 240
Subarea Drainage
Requirements, 242
Retention and Detention
Basins, 244
Creating Project Amenities,
249
Erosion
and Sediment Control Plan, 251
Temporary Control Measures,
253
Permanent Control Measures,
255
Site
Engineering and Your Project, 257
Chapter
8 Residential Streets, 258
Street
Design, 258
New Directions in Street
Design, 259
Local Street Ordinances, 261
Applying
Ordinances to the Master Plan, 262
Street Hierarchy, 263
Street Width, 264
Cul-de-sac Turnarounds, 265
Street
Geometry, 266
Intersections, 267
Curb or Corner Radius, 269
Vertical and Horizontal Alignment, 271
Street
Patterns, 273
Density and Scale, 274
Site Conditions, 277
Focal Points and Pedestrian Routes, 278
Basic Design Considerations, 278
Cross Sections and Stormwater Runoff Systems, 281
Street
Design Process, 282
Entrances, 282
Enhancing
Your Project's Identity, 284
Chapter
9 Selecting Housing Types,
286
What
the Buyer Wants, 286
General
Design Issues, 287
Density
and Pattern, 288
Single-Family Detached, Large
Lot, 288
Single-Family Detached, Small
Lot, 289
Attached Housing, 294
Matching
the Target Market's Demands to
Housing
Types, 301
Style Preferences, 303
Regional Preferences, 303
Site Characteristics, 304
Climate, 305
Homebuyer's
Identity, 309
Planning
as the Key to Success, 310
Appendix
A Sources of Marketing Data, 311
Demographic
Data, 311
U.S. Bureau of the Census:
Census Reports, 311
U.S. Bureau of the Census:
Other Publications, 311
Congressional Information
Service, 313
Private Sources of
Demographic Data, 313
Psychographic
Data, 315
Appendix B Land
Development Checklist, 316
Market
Analysis, 316
Target Market Identification,
316
Relating Product to Target
Market, 316
Determining Capture Ratio,
317
Financial
Analysis, 317
Land Acquisition, 317
Loan Structure and
Disbursement, 318
Pro Forma Analysis and Cash
Flow, 318
Site
Analysis, 319
Physical Factors, 319
Legal Factors, 322
Political Factors, 324
Off-Site Factors, 324
References, 326
Index, 329
Land Development
Introduction
Introduction
Successful
land development requires you as the developer to go through a complex process
of many interrelated parts. While land development is both an art
and a science, the most important aspect of the process is its holistic nature.
Each separate part influences the others and a viable solution must take into
account market demands, budget constraints, and site conditions.
The
process usually begins with an idea for the creation of a new development that
will serve the needs of the local market. This new development should take its
place as a good neighbor within the local community by acknowledging its
relationship to adjacent land uses. It should also become economically viable
for both its inhabitants and the developer. Therefore, to produce a successful
idea for your project, you begin with a thorough understanding of what your
potential buyer needs and wants in a new development.
The
Process
Instincts,
timing, and planning play an important role in creating a new development.
Although you can cultivate sharp instincts through experience, timing and
planning can be improved if you understand the process of land development and
its various components. As Figure 1.1 shows, creating a new development concept
on a particular site combines three distinct endeavors: researching existing
conditions; analyzing them for project opportunities, constraints, and
costs; and synthesizing the results into a coherent, functional plan that
supports the original development idea. The master plan is the basis for the
design of the development. It can consist of a drawing of the development's
layout on the site and a program, which is a written description of the design
components of lots, streets, and project amenities.
The
process in which these three endeavors are involved is not linear. At many
points, you must retrace steps as you discover new information and its effect on
previous decisions. This synthesizing information, discarding unworkable ideas,
and then reevaluating information to generate new ideas is the hallmark of the
process. Only when you appropriately modify original impressions and decisions
at various stages along the way can you produce a successful project.
Where to Begin
You may approach the process from several
different standpoints. How it is begun influences the order of the process
itself. If you have already acquired a parcel of land, the process begins with
determining the most marketable use for the site. Another approach might begin
with a search for a suitable site that will support a previously determined
marketable idea. The process can also begin with efforts to determine the best
marketable idea for a given local area followed by the search for the best site
to accommodate the idea. Once the site and the idea are placed together for
serious consideration, the process of researching, analyzing, and synthesizing
data to produce the final master plan is the same for each approach.
Key
Elements
As
described in Figure 1.2, the key elements of the land development process are
market research, site selection and analysis, project design, site engineering,
project costs, and financial feasibility . Each element has a unique role to
play. Market research involves determining which type of buyers to capture;
understanding their buying power, lifestyle characteristics, and product
demands; and matching housing types and master plan concepts with those
characteristics.
This
part of the process can extend through to the marketing and selling of the
project.
Site
selection and analysis involve developing a list of desirable site
characteristics; analyzing site conditions; and evaluating all the physical,
legal and political, and off-site characteristics of a particular site for their
contribution to the project's success. Project design matches marketing
information on buyer preferences with site characteristics to produce a master
plan and housing types that best satisfy these requirements. Site engineering
deals with the physical handling of the topography and installing the
infrastructure to support the master plan.
Managing
project costs involves determining both soft costs (fees, marketing, and testing
and investigating site conditions) and hard costs (labor and materials) for the
project together with the schedule for completing each task. From this
information, you can then produce an accurate project cash flow. Financial
feasibility refers to determining the profitability of the project from sales
forecasting and project costs.
New Complexities
By
providing housing, places of business, and jobs for growing populations, land
development remains an important part of the national and local economies.
However, in spite of its necessary role, developers face more challenges in the
form of regulatory requirements and adverse site conditions than ever before. It
is not uncommon now to confront increased costs of site work and construction;
shrinking municipal budgets for providing community security, schools, and
infrastructure; and the growing public concern about decreasing environmental
quality, which many unfortunately associate with development.
To
compound these problems, growing public scrutiny is producing more organized
attempts to influence the way land is developed. In many markets, the land with
optimal development potential has already been developed. Most of the remaining
land contains many restrictive qualities that caused developers to pass over it
in the first place. However, this land is frequently found in prime marketable
locations and may be worth developing if done correctly. But developing this
type of land profitably increases the importance of discovering, analyzing, and
synthesizing all the critical marketing, financial, physical, legal and
political, and off-site information to determine project success.
The
eighth edition of Land Development offers you, the developer, a sound,
general framework for successful land development. However, each location can
have different regulations, development standards, and markets, so you are urged
to become as familiar as possible with the development process in your own
community. Knowing local conditions along with the general process will enhance
your chances of developing a successful project.
If you
are a student of land development, use this book to step into the professional
developer's shoes. As the book walks you through the process, try to
imagine what it must be like to deal with its many complexities on a daily
basis. By the time you finish the book, you should have a better grasp of the
key components of this creative and exciting process.
The
Project Team
Successful land development relies on expertise
from a variety of professionals. Assembling the right mix of professionals and
consultants to provide the specialized knowledge required for creating a viable
project is one of the first milestones on the critical path to project success.
An effective project team is needed to determine
the essential factors to investigate and analyze for each project. As the
project leader, you as the developer are responsible for assembling and
directing that project team. Primary members of the project team include the
people in charge of market research, financial analysis, land planning, and
design (see Figure 1.3). Once that team is assembled, proper coordination of
data and information from the professionals and consultants is important to both
project success and lower project costs.
Market Research and Financial Analysis
Consultants
You may
either purchase market research information or gather it with in-house
capabilities. Similarly, an outside consultant or in-house staff person may
perform the financial analysis. The team member responsible for market research
directs efforts to determine the appropriate buyer and discovers buyer
preferences. The financial planner determines the feasibility of the project
under various sales rate projections when all project costs are considered.
Project
Planner
The
project planner or director of the project oversees the development of the
master plan from the information about buyer preferences and costs provided by
marketing and financial planning, as well as appropriate design concepts from
other design team members. The project planner might be a professional land
planner, urban designer, architect, or landscape architect. Although one of
these professionals might be in charge, each would require input from the other
experts on the project team during the process.
Another
key member of the design team is the civil engineer who might analyze all
geotechnical conditions and determine corresponding infrastructure requirements.
The most Successful master plans depend on the planner, architect, landscape
architect, and engineer working together to produce a developer's vision for the
new development.
Auxiliary
Advisers
At
times, you may need to call in auxiliary project consultants to help the primary
team members in their decisions on the master plan. These might include
hydrologists, geologists, soil scientists, environmental experts, construction
managers, and attorneys. The size of the project and the physical
characteristics of the site will help you select the kinds of consultants
necessary. The project planner should determine the need for additional
consultants, advise you about their respective roles, and coordinate the
distribution of all information among the project team.
The Developer
Successful integration of information from all
disciplines requires strong leadership. From the beginning, you should clearly
define the goals of the team to prevent duplication of work, gathering of
unnecessary information, and increased predesign and preconstruction costs. You
also need to clearly communicate up front how information will be shared and the
schedule for project deadlines. As development progresses, you must coordinate
through regular meetings the efforts of team members as they create and
implement the ideas of the master plan. Throughout the process, provide clear
guidance to keep the team focused on those aspects of the project that are
critical to its success.
Although an effective project team is an expense
that you must bear up front, it can actually help to hold down the rising costs
of examining feasibility and complying with a more complex regulatory climate.
Changing regulations and political and environmental impacts may create new
project constraints and usually cannot be avoided. However, an effective team
can help you look for ways to turn project constraints into opportunities for
new designs with increased market appeal.
One reason for this is that buyers have higher
expectations today about new developments. They expect more quality in products
tailored to their particular needs. They also expect more customer service and
follow-through after sale. Increasingly, quality in the form of environmental
and community sensitivity sells. Marketing a development by emphasizing measures
taken to preserve the natural features of the land and integrity of the
community can provide the foundation for a quality-based approach with a strong
appeal to the buyer.
Future
Homebuyers
The so-called traditional family of mom, dad, a
dog, and one or more children no longer makes up most of the homebuying public.
In fact, the 1990 census reported that the traditional family represented only
26.7 percent of U.S. households. Changing demographics show a dramatic increase
in older buyers, single parents with children, two income families with no
children, single buyers, and two unrelated single buyers. These trends are
expected to continue in the next 20 years and future homebuyers will demand a
different kind of product than the traditional home and development.
Current trends translate into such new product
offerings as smaller, low-maintenance lots; access to public transportation;
fitness-oriented amenities; the two-master-suite home; and convertible offices
and bedrooms. As market niches grow more narrow, the wise developer will
continue to stay abreast of changing population characteristics in order to
provide the most marketable product in the future.
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