A compilation of Fine & Country I.D.E.A.L Investor Series
When investing in real estate , here are important questions to ask.
DURATION – When will the development be delivered? Is the stated time frame realistic for completion and are there any penalties on the developer for late delivery? Successful real estate investment and development is all about timing. Project management by a reputable firm should help with this. However, it’s important to note that projects will generally overrun, but beyond 6 months or in a worst case scenario over 9-12 months, the profitability of the project would be significantly jeopardized causing both the developer and buyers serious danger.
In addition to ensuring the integrity and duration of the project, another question to ask is what is the Excellence factor? Does the project have a WOW factor to it?
EXCELLENCE – Does the development have the quality of being outstanding? What makes the development an excellent project? What is that special feature that sets it apart from the competition? This can be a combination of many things from extraordinary views such as defining water features such as the man-made Twin Lakes by Chevron Pension Fund, Eko Atlantic with its Great Wall of Lagos feature, and other distinguishing features including the use of technology and iconic architecture. These types of features not only attract the initial buyer but also underwrites the value of your investment long term. Iconic projects speak for themselves, create an enhanced return on investment and retain their value long term.
In addition to ensuring the integrity, duration and the excellence factor of the project, another question to ask is what is the AIM of the Project? What does the project stand to achieve?
What is actually being developed? What is the purpose of the project? The development must be relevant to the market and its’ location in order to raise finance and not end up as an abandoned or significantly delayed project. The development should have the relevant facilities required by its’ target market. For example, a development describing itself as luxury should have at a minimum in this location, basic lifestyle amenities such as a pool and gym to justify the asking price. Luxury of course should go beyond basic amenities and should typically offer features that create a sense of exclusivity and desirability that regular buyers would aspire to. Luxury is after all more about a sense of pride and accomplishment more than anything else. In the entry to middle market, similar questions apply, but in this segment it’s more about value, rather than convenience or extra fancy finishes. The key question that still begs answering, is what the high value areas are for middle market investors. Only by actually engaging the potential end users in any segment through a market intelligence report can the accurate answers be deduced.
In addition to ensuring the integrity, duration, the excellence factor of the project and the purpose (or aim) of the project, one last key factor and very important question ask is; what is the Location of the Project? Where is the Project located?
LOCATION – Where is the development located? Location is more than just its’ immediate surroundings. Important location considerations include the area’s security, access to transportation hubs, proximity to good schools, hospitals, restaurants, leisure centers etc.
In developing economies like Nigeria, location has to have a multi-layered approach in assessing what’s a Prime versus viable or growth location. At Fine and Country, we take a considered view of many factors in assessing locations that will hold value both in the long and short-term.