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Attention Real Estate Developers – What Is In Your Business Plan?

Do you need a real estate development business plan? You will if you want to obtain financing for your project. The first thing any lender or private investor will want to see is your real estate development business plan. This plan is specific for development of real estate. Your business plan will tell your story in an organized and concise manner. It will provide all of the critical information needed to judge your project. A well-written and professional looking business plan is crucial for your success in obtaining financing 26 newton.

Most real estate developers make the mistake of not creating a good business plan or even getting professional assistance in developing their business plan. They will use the excuse of not having enough time or they can’t find the data. Don’t let that be your excuse! All a real estate development business plan really is, is the answers to a bunch of questions! You will learn what to include in your real estate development business plan.

Executive Summary

The Executive Summary should provide a complete overview of your project & company. This will include:

  • Brief description of the overall project. For example, develop a 4 star, 250 room luxury hotel in downtown St. Louis, Missouri.
  • Brief overview of the company – Is it a corporation, LLC, etc? Who are the owners and/or board members? Brief company history & experience level.
  • Brief summary of the market & demand.How large is the market and at what stage of development is the market currently in?
  • Brief summary of the competition and what separates you from them?
  • Brief description of key Management team members.
  • Key financials – total acquisition & construction costs, nature & use of funds, future revenue & expenses.

The Executive Summary should be brief and an outline to your overall business plan. Now lets take a look at the specifics in the real estate development business plan.

The Company

This part of the business plan should give full details about how and when the company was formed. It should indicate the legal structure of the company, as well as where it is licensed. A key piece of information about the company is the company owners. Name all of the principals and their percentage of ownership.

Project Description

This section of the plan is where you explain your project in detail. Remember, you are selling your project so that you can get the funding you need! Is this a hotel development project? Is this a luxury, single-family home community project? Is this a multi-tenant shopping center? Give all the details about the project. For instance, lets continue with our hotel example. You will want to name the other amenities that will be located at the hotel, such as swimming pool, tennis courts, the number of conference rooms, etc. How many of the rooms will be suites? What other features & benefits will your project have?

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