Comprehensive checklist for managing the developer’s ‘seed money’ budget
Phase 1 - Site selection and seed money
1.1. Land acquisition
- Estimate costs associated with acquiring the chosen site.
- Include expenses such as purchase price, legal fees, and title searches.
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1.2. Project studies
- Allocate funds for environmental studies, geotechnical assessments, and other required studies.
- Budget for expert consultations to gather essential data for project planning.
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Phase 2 - Predevelopment seed money
- Plan for expenses incurred during the pre development phase.
2.1. Design fees
- Budget for architectural, engineering, and other design-related fees.
- Ensure adequate funds for creating detailed design plans.
2.2. Marketing expenses
- Allocate funds for promotional materials, website development, and advertising.
- Include expenses related to branding, market research, and public relations.
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2.3. Financing expenses
- Set aside seed money to cover costs associated with securing project financing.
- Account for fees related to loan origination, legal consultations, and financial planning.
Phase 3 - Preconstruction or preclosing seed money
- Prepare for expenses related to the preconstruction phase.
3.1. Construction expenses
- Estimate costs for construction materials, labor, permits, and subcontractors.
- Budget for unexpected costs that might arise during the construction phase.
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3.2. Design expenses
- Allocate funds for design revisions and adjustments during the preconstruction phase.
- Ensure the budget can accommodate design-related changes.
3.3. Marketing expenses
- Continue funding marketing efforts to maintain awareness and generate interest.
- Consider ongoing advertising and promotional activities.
3.4. Financing expenses
- Account for any additional financing-related costs that arise during the preconstruction phase.
- Ensure funds are available for any unexpected financial requirements.
Phase 4 - During construction seed money and equity advances
- Manage ongoing expenses during the construction phase.
4.1. Predevelopment budget management
- Monitor and manage the budget throughout construction to ensure financial discipline.
- Identify and address budget overruns promptly.
4.2. Predevelopment work order system
- Implement a system for tracking and managing work orders during construction.
- Ensure that all work orders are authorized and aligned with the budget.
4.3. Work order system procedures
- Define clear procedures for submitting, reviewing, and approving work orders.
- Ensure proper documentation and communication throughout the process.
