Innovative Real Estate with Three Squared, Inc.
As specialists in efficient residential and commercial prefabricated design, Leslie Horn, Breck Crandell, and Jill Ramirez of Three Squared, Inc. share their greatest insights, tips, and case studies from their years of experience in the industry. They'll be giving you their best advice through, trainings, guest features, and Q&A segments so you can turn your innovative vision to a reality.
Innovative Real Estate with Three Squared, Inc.
Everything You Need To Know About Real Estate Investments with Jan Dijkers
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The real estate development industry can be an overwhelming place...good thing there are experts like Jan Dijkers, whos' job is to help developers and builders alike to navigate the industry.
Jan is the Managing Broker and President of Berkshire Hathaway Home Services, The Loft Warehouse, a Detroit based real estate and marketing company.
In this episode Jan shares how she got her start in the real estate industry and her process with working with developers from start to finish to create the most efficient housing. She also shares her experience working with first time developers, analyzing building plans with a buyer mindset, and why working with her company could take your development to the next level.
Here's a glimpse of what you'll learn:
- Who is Jan Dijkers and her role in the real estate industry
- How she helps developers find land and create efficient housing
- Why it's important to have girt as a developer
- Thinking twice about Land Bank land
- Project Highlight of the Week: Veterans Housing Prototype
Head to Berkshire Hathaway Home Services, The Loft Warehouse to learn more about their services.
Subscribe to Jan's email list here: https://www.jandijkers.com/subscribe
Full Show Notes
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Welcome to the Innovative Real Estate Podcast with your hosts Leslie Horn, Brett Crandall, and Claire Olilla. We're here to make your life easier as a real estate developer and teach you everything we've learned about designing and building innovative homes, multifamily, and mixed use structures. On this podcast, we'll be giving you our best advice, trainings, and QA segments so you can learn from our years of experience and make your innovative vision a reality. Welcome back to the podcast, everyone, to episode 65, where we're going to be diving in with another awesome guest by the name of Jan Dikers, who is a longtime friend of our wonderful CEO, Leslie, and we'll give an awesome introduction to her in a moment. We're going to be having a conversation around financing and interest rates and also Jan's personal experience as a real estate investor and lessons learned. So you're definitely going to want to tune into this conversation. But before we get into that, I'm going to kick it over to Breck for our project highlight of the week. What we got, Breck?
SPEAKER_00Speaking of real estate solutions, uh, we actually have been working with a number of uh partners and uh different nonprofit organizations on housing solutions for a long time. One of those housing solutions being targeted specifically for veterans. Uh, veteran associations, veteran housing is obviously something that our nation has struggled with for years. And there are a lot of people working on fantastic solutions. So here in the city of Detroit, we actually had a lovely couple who have been lifelong residents of Detroit and spent a lot of time and energy in their community, uh, are looking to support veteran housing solutions. And so they came to us, and lucky for them, we had also been working on solutions at that time. And we found a model that fits their needs very well. So, what we're working on is actually um, it's a tiny house, but it's not a tiny house. And the reason why I say that is because we actually did an exercise a few years ago where how small of a house makes sense? Uh, because as we've talked about on this podcast before, um square footage of a house and cost of a house based on square footage is kind of a misleading question, just because there are expensive areas of home and cheap areas of a home. And so a kitchen and bathroom, if you build that, uh, you'd be remiss to not give yourself a little bit of free living space. Because if you build a super tiny micro house that has a full kitchen and a bathroom, uh, the rest of the space is what we affectionately refer to as dumb space. So we actually ran the numbers and worked with appraisers to determine what the minimum square footage is before you're actually losing money on a design. And that magic number was 750 square feet. So we have a 750 square foot building, which has a full bathroom and a full kitchen that supports a living and dining space and then a bedroom. And this is a one-story structure. We also have an alternate version of this structure that adds an additional 350 square feet for a total of 1100. And that version is a lofted version that has a small staircase up to a lofted bedroom that overlooks the rest of the building. So these are uh prototypes of veteran housing that we're gonna be rolling out on some vacant lots here in Detroit uh through a city program. And we're really excited to show you what that model looks like here in the new future. All right, Leslie, we're gonna hand it over to you to give a warm introduction to a friend and confidant of yours for years.
SPEAKER_01Oh my gosh, 20 years. When I said those words out loud this morning, I almost fell off my seat because that means that's when I started my real estate journey. And I met Jan in the very beginning. We were both starting, I'm gonna say pretty much about the same time. And Jan and I worked together. She worked in helping rehab 30 houses back in the day. And boy, it was rough back in the day. I mean, we've got stories, we're not gonna, they would not be boring. Um, so but we've got a focus on this today's podcast. So Jan comes to us with great experience, not just as um a real estate investor, but also as a real estate broker and managing partner of Berkshire Hathaway, the Lopes Warehouse, which is actually probably one of the, and you can correct me, Jan, but I think it's actually the largest uh brokerage house here in the city. I think that you guys have done great work um in navigating not just you know large projects and and such and and people who are renting, but also to help navigate newer developers. I know that your office is very kind and patient, and we'll talk a little bit about that when new developers come your way looking for land and such. But I've always been struck by your the way that you handle stress. I've seen the most stressful times. Um I've also seen how graceful you are during those times of communication and hard conversations. And I don't know, it's just always been a privilege to call you as a friend, also to see how much you've grown and really are such a leader in this Detroit market. And we're really, really super thrilled that you are here today. I know you're gonna give our audience some really great nuggets. And I hope this is the first of many times that you are on. And just as a little plug here, I receive your emails uh with your little with your posts, and you also give tons of golden nuggets, um, little videos. Sometimes they're two minutes, sometimes they're seven or eight minutes. Uh, I've shared with you that I listened to about 90% of them. And I have to say that I've learned so much from those. So this is a little plug. People need to get on that mailing list because it's really uh a viable way of learning just through the experience of what's going on, not just in the Detroit's market, but also in the whole real estate market as a whole. So, Jan, I really want to welcome you here. And I'm just gonna start you off by asking you a little bit about your experience and and most recently, and let's say in the last two to three years, what's been the highlight of business um for you as a real estate broker and an investor? Hey, welcome. Thank you so much. Thank you for that warm introduction.
SPEAKER_03You bet. You bet. Um, yeah. Wow, 20 years ago, I I was literally like a child compared to where I am now. Um, I have learned and grown so much, but my experience working with you um definitely sort of opened the doors up for the beginnings of my real estate career, including, you know, property management. You know, it's kind of how I got my cut my teeth and we were in, you know, worked through the trenches for a long time. And I'm no longer a property manager, but it it opened a lot of doors for me. Um so uh so my my current day-to-day is mostly um uh related to real estate sales. Um, and I and I work with a huge variety. I think that's what I love about Detroit, is there really is a huge variety of um opportunities. I do, I would say probably 85% of my business in the city of Detroit um go to the suburbs when it's right for the right people and the right opportunities, but I don't like to have to drive too far from my house. So try to stay, try to stay in the city. Um, and uh our office is definitely Berkshire Hathaway is definitely recognized as um, you know, a leader in Detroit residential real estate. Um, so most of the opportunities that come to me are related to that. Um so you know, I'll I sell a $100,000 house and a million dollar house. And I love the variety and I love being able to help all different kinds of people. Um, I don't think that anybody one one of my philosophies is I don't think that your budget should really limit your access to great support. Um, so I like to be able to kind of spread uh, you know, my um value, you know, and uh uh service around to, you know, as many people as, you know, I I think are, you know, a good fit uh to work with. Um specifically at Berkshire Hathaway, we have really um created a niche for ourselves in developer support. Um we're more of a condominium um specialist in condominium uh you know uh commercial type real estate, condo conversions. That's kind of our bread and butter, although we are certainly open to um exploring developer support in other ways. Um, but we have created um a system, basically, when a developer comes to us, whether they you know have a piece of land or they have a building or they would like to explore an opportunity to create housing, um, we have sort of a proprietary system where we're able to help them create the most efficient um product for you know the location, the amenities, and the finishes. Um, and so we are able to help them with that feasibility to to and then work with them to create a product that people will buy instead of a developer coming to us and saying, hey, we built this building, can you help us sell it? You know, it's like, well, you built them too big or you know, they're they're overimproved for the location. You know, we can't, you know, achieve these numbers for you because it just didn't, you just didn't, you didn't do, you didn't go through that feasibility in that process first. So we want to catch people at the very beginning and help bring them through the entire process and support them along along the way. Anything from helping them uh analyze the most efficient floor plans with their architects, uh put together their condominium association and budget, um, you know, any any support that we can give them, you know, that's that's kind of what we specialize in. Yeah, that's pretty amazing. Breck, do you have a question?
SPEAKER_00Oh, I'm loaded up a question. So I had one of the first things that comes up because you've actually consulted with our team in the past. Um, you've given us some really valuable feedback um from your stance, just looking at uh looking at my floor plans and tearing them apart. No, it's it's actually a very supportive conversation um and a and a and a good conversation around, you know, because architects are looking at one thing, and you on the financial side of things is looking at a totally different thing, and we have to kind of meet each other in the middle in order to have the best possible solution for layouts of these spaces. I want to ask more well, well, let me prompt you with the question. What are some of those major features that you look for? Like, what are the hot topics that like immediately when you look at a set of plans for a condo or for an apartment unit? Like what stands out is like we need to address these things immediately.
SPEAKER_03Yeah, yeah. And it's not just we're not necessarily coming from a financial standpoint, we're coming from, you know, we architects don't talk to buyers every day and developers don't talk to buyers. We talk to buyers every day. So we know what they want and we know what they're looking for. So it's more looking at it from like a buyer standpoint. So some things that we think about is what do you see when you walk in your front door? Do you see a wall? Do you see a closet or do you see the view? You know, do you see the expansive living room? So we look at things like that. Um, you know, what how is the buyer going to feel when they walk in the front door? Also, how are they going to get to their front door? Are they, you know, is it a million-dollar condo and they're walking through a tiny narrow hallway? Because that's the most efficient thing for the developer and architect to design. Um, you know, so we want to think about, you know, those things like based on the price that you're going to be asking people, like, how are they getting to their unit? What do they see when they walk in the front door? And then we also look at what we call um wasted space. We want every part of the floor plan to be useful. And so let me just give you an example. Through our research, we have found that um, you know, a two-bedroom, the most efficient size for a two-bedroom is 1200 square feet for a condo. So, you know, anything smaller than that, the buyer feels it's too small. Anything bigger than that, you have to give that, you know, if you have a 1400 square foot two bedroom, it's not just a bigger 1200 square foot. What are you getting for that extra 200 square feet? Is there like an extra room? Is there um, you know, an office space? Is there, you know, what what are they getting? So if you just have a really big 1400 square foot two bedroom, but you're not making that space feel useful, then somebody's not going to see the value in it. So we think about things like that. So I would say those are the three biggest things that we sort of are contemplating when we're giving feedback on floor plans.
SPEAKER_01Yeah, and and it really is an amazing process. I've seen the feasibility process on small and large projects. And you're right, it's things that we as architects and or developers sincerely we're just you know, we're just loading up to see what we how much we can sell it for, right? Like what is the highest and best use for this land? And there are times when, you know, smaller apartments. I mean, there's as you know, the the the new place going up where Joe Lewis Arena was. Holy smokes, the rents, um, first of all, they get a view for that rent price. Um, but we're looking at anywhere from two to eight thousand dollars a month for rent. And um I think they can warrant it actually, quite honestly. I still think it's high for Detroit, but I mean, I take a look at those type of projects. Is that one of yours, by the way? It is not. Okay. So I I take a look at some of the things like that, and just also there's a lot of depressed places in Detroit that a lot of developers are trying to come in and really set a standard and really start to develop the block as a whole to increase the values. And I know you guys work a lot with developers emerging and actually current and existing developers, a lot of them from out of the state and even out of the country, because Detroit right now is such a market, it's such a great market for us to be in.
SPEAKER_03Yeah, absolutely. There are so many opportunities just with land and dilapidated buildings and um emerging neighborhoods, you know. Um, I mean, I think that's one of the things that has always attracted me to the city. You know, it's you're um, you know, kind of a big fish in a small pond. You can definitely you can be a developer. You know, in New York City, you're there's no way that you can just be a mom and pop developer, you know, you you need millions and millions of dollars. You know, here you can, you know, you can bootstrap a development um if you have, you know, the resilience, which um I definitely you brought up and I want to talk about more. If you have the resilience to kind of make it through.
SPEAKER_01So isn't that the truth? Well, let's go ahead and shift to that. Let's talk about the, you know, the like, let's say a newer developer comes to you and they're like, hey, um, we met with an architecture firm, but they said I really need to have land first, because that's what we tell people. Go talk to Berkshire Hathaway, go find Jan. She'll she'll hook you up with somebody that will get your needs. But tell us about that process because I know it happens to us a lot where we just, hey, go find land. And you know, the land bank, let's try not to talk too much about that because then Breck will get really mad and we'll be cussing on the line and um on the podcast. But let's let's do talk about some of the warning signs of quote, land bank traps and um and other things. But let's say a new developer comes to you. What's what's the process?
SPEAKER_03Um, so we we want to know um, you know, first of all, what their experience is. So maybe they have none, um, but also want to understand their um their risk aversion. Um, want to understand what you know what they understand about Detroit if they're from here or have connections here or no connections here. And then we really want to know uh, you know, what do they want to do with the, you know, what is their vision? Um, because we can help guide them to a property, you know. I mean, we we want to look at, you know, how properties are zoned and, you know, would there be a fit in a certain neighborhood for, you know, a certain development. So we want to know as much information as possible so we can really help guide them. And I think the only thing I'll say about the land bank is, you know, they do sell land for really cheap. And I think that is um definitely, you know, I have buyer people call me all the time and they're like, well, why would I pay this for that land when the land bank's selling this for that? And then I have to explain to them that you're getting land for cheap because there are so many strings attached. And, you know, unless you are um, you know, probably more of a seasoned person that's willing um to have a lot of strings attached, then we should probably look at some land that's gonna be a little bit more comfortable for you to own for a long period of time while you're figuring things out.
SPEAKER_00Um so I'll talk to anybody who wants to discuss the land. I've been there, done there. And yeah, I mean, even with my extensive industry experience, it was nearly impossible for me to navigate. I don't understand how they could make this truly accessible to the general public, you know. So that's that's really good advice. So, so speaking of the city of Detroit in particular, I am curious as to your position and your thoughts on what we have had in discussions with uh buildings planning, uh, you know, some some of the higher ups there at the city have expressed their frustration with the apartment stock being almost exclusively studio units, one and two bedrooms. There is no family housing available in the market for Detroit right now. And I'm curious as to what you have to add onto that conversation.
SPEAKER_03Um, that's that's interesting to hear. Um, so we I don't do a ton of uh I mean we certainly would work with an apartment developer, um, but but that's that's not some, you know, we we we more come from the for sale aspect. And we also um most apartment buildings have their own leasing agents. So we're not necessarily involved in, you know, getting hired as a realtor to help do leasing. So um, but I will say this based on our model and analysis, um having just studios and one bedrooms is not the appropriate mix, you know, people do want larger housing. So I would imagine that it is something having to do with um, you know, that that they're people aren't aren't getting the right advice on a appropriate unit mix. So they're not creating enough house. I mean, I know people do like to live alone and people, you know, will get the biggest best property for their budget. And sometimes that might only be a studio or a one-bedroom. I'm sure people would love to rent a studio if, I mean a two-bedroom if they could afford to, if their budget allowed them to. Um, so I don't I don't necessarily understand. It doesn't seem uh right to me. It doesn't seem like uh somebody is coming at it from the what the market actually would demand and want. So um, you know, I'm not I'm not entirely sure about that. Um, I think that there could be a lot of room for two bedrooms and then a you know a mix of some a few three bedrooms here and there.
SPEAKER_00Yeah. No, I've I've I've found some really interesting sources that as we talk about like layout of units and the amenities that are provided within them. Um a lot of a lot of the issues of smaller apartment units actually stems all the way back to building codes. I I was actually kind of surprised to to learn this, but when you really break it down, it makes a whole lot of sense. Building codes stipulate that we we need to have two exits out of every building, which sounds like, okay, yeah, we're protecting the the safety of people. However, the you know, the the road to hell is paved with good intentions. And uh and and what we found ourselves is these double-loaded corridors that have a huge hallway that connect a building to two staircases is actually limiting the amount of window space that exterior units can have. And so you're actually forced to put units directly next to each other, which means you only get windows at the end of the building. You don't get them on the whole sides, so you can't put a bedroom way back in the space. So therefore, you just have to leave an open wall and call it a studio unit. And so it's not actually getting the maximized value out of this because we're following it all the way back to code. And that code came from we're trying to make sure that people could get out of a building safely and that a fire doesn't kill them. But there's been huge, huge leaps and bounds made in building materials and technologies and fire suppression systems and in general, just municipal response to fires. And so the deaths happening or the risks happening with fires in apartment living have dramatically decreased year over year historically. And so we're we're kind of stuck up against some of the rules of engagement and working with building codes and zoning ordinances in the city that dictate that we design a certain way, but it's kind of painting us into a corner where we might not have the stock that the market is requesting, just because our hands as architects and designers are tied in these particular instances.
SPEAKER_03Right. Because right now, especially with the expensive uh building and construction, it's probably the cheapest to design a box, right? You're not designing something that has, you know, like insets and courtyards and things like that. So if you're designing a box, Box and you only have so much wall window space, you're getting a lot of studios.
SPEAKER_00Yeah, exactly. I mean, every 90 degree turn you make on the outside of a building costs money. You're right. Yeah. A simple, boring box is always going to be the cheapest solution. And it's unfortunate that you know the market kind of dictates that we have to meet a certain value in order to make this happen. So let's let's talk a little bit about uh, well, some of the interest rate implications and how that's affecting what is available on the market. Because again, this is this is one of those factors that challenges us as designers to be able to meet the market where it's at. So give us give us a reading, finger on the pulse. How are we doing?
SPEAKER_01Okay, Crystal Ball, come on, let's do it.
SPEAKER_03Okay. Um, and just as an aside, Leslie, you were referring to my market update videos where I do kind of a little bit of a longer form uh read on the market, you know, interest rates, um, uh housing absorption from a national and a local uh take. So um we'll make sure to, you know, if you want to sign up for my email list and receive those in the future, then we'll make sure that you get um you get looped into that. Um yes. So I would say that um the the very the toughest time for real estate with interest rates was the fall of 2022. Um it wasn't necessarily the when when there we had the highest interest rates, but it was when the market was most impacted. And I would say from a consumer standpoint, from a residential consumer of real estate standpoint, people were flipped out, they were freaked out, rates had just started to go up, and the market was at a complete hold. We saw that loosening up in the spring of 2023. We had a pretty robust spring market in Detroit and nationwide. Um, and so now I think buyers have come to terms with the fact that rates are, you know, probably not gonna go up. They're not really coming down. Hopefully they will in the future. But the, you know, I feel like um a lot of people have sort of come to terms with the fact that if I want to buy a house, I just need to get in the game right now because housing values are not getting any cheaper. Um and uh so we're still hovering around six and a half percent right now. Um, not every person who wants to get out in the market is ready to do that at six and a half percent. It's loosened up a lot of um people, but not everybody. A lot of sellers who have two and a half percent interest rates don't want to sell because they know that if they buy, that they're buying at 7% or six and a half and they're just not ready to do that. Five and a half percent seems like that's gonna be the magic number. That's when most people have said they're they're they're ready to give up their low interest rate at five and a half percent. So I think once we achieve that, I think we'll be in really good shape. Now, from a commercial loan standpoint, um, because most buyers, when they buy a house, their interest rate is fixed. The day of closing or when you apply for your mortgage, if you're if you get a 6.3% rate, that's what you have for 30 years. Very different for construction lending and commercial lending for office buildings. And um, they're tied to usually like the 10-year treasury note. So that rate goes up, your interest rate goes up. It's very unlikely to be a fixed rate. So I feel like that has really created a lot of uncertainty in the people who build housing and you know, own how, you know, commercial housing and um commercial residential and things like that. And you know, that's kind of and that really is affecting developers because they don't know if I take out this loan, is my rate going to go up? And usually these loans are like five years at a time. So, like, what happens at the end of five years if I can't get another loan that works with my pro forma? All of a sudden I'm and we're and we're seeing that with a lot of, especially office buildings around the country. There's a lot of people's loans who are gonna be coming to that five-year term and they're gonna be totally screwed because you know, they just their their numbers were based on a lower rate, and uh, you know, they won't they they may not be able to hold on to their properties. So I think we're gonna see a big reckoning, especially among the commercial office market. But it has created a lot of developers just not feeling super confident that um, you know, that their their numbers and their performer are going to work for them, you know, with a project that they're starting today, that, you know, by the time they go to get financing, will they be able to get financing that will support it? And how is that change going to affect them? So I'm sure you're experiencing a lot of uncertainty in your developers that are, you know, coming to you, not being able to make make things work.
SPEAKER_01Yeah, it's really true. And and just to your point with the commercial industry and all of the, you know, retail spaces that are just oof. And now there's government programs to help support them and turn them into housing, uh, which is really what we need. It does put pause on commercial infrastructure here, even in Detroit. Just let's just go around the corner. Everybody knows we're we have a project coming up that's a mixed-use building, and we've already pared down the commercial space in it. Um, and we're actually thinking about paring it down again. We'll we have some big big conversations to have over the next couple of weeks, but it's really huge, you know, because you don't want to be stuck. I mean, that's the whole thing. And I know the government has subsidies and now programs to convert into housing, but not all places are appropriate for a housing space. Um, there's a lot of cool places that would be amazing. Um, and we're working on a firehouse right now, an engine house, which is gonna be a really fun place here in the city, but nonetheless, not all of them are really cool and we'll even pencil out regardless if they're commercial or uh residential. Um tell me about some of the smaller, like in your firm, in in in Loft Warehouse in Berkshire Hathaway, what like what's an ideal client for you guys to come in as a developer who says, hey, I just want some land. Um, let's say they're not as experienced, but you know, what tell me a good target market for you guys and what you guys are actively looking for.
SPEAKER_03Um, so we have really done well with smaller developers who want to build, you know, 10, 15, 20 condominiums. Um, the townhouse model works really well for condo development right now because it's it's very efficient. You can sell every square foot that you build. There's no common hallways or, you know, things like that. You also don't have to build, you know, if you have an apartment building, 100 units, let's say, you have to build the entire building. You know, you might not build out all of the building, but you have to build the entire structure. Versus a townhouse, you could build five at a time and then sell those, and then five more and then sell those.
SPEAKER_00So you effectively what you're referring to in that case is a phased approach of development.
SPEAKER_03Exactly. Um, so that seems to create um a lot, and we and we are seeing a lot of phasing. So that that definitely, so that's sort of our um seems to be our bread and butter right now in emerging areas. So we're seeing a lot of development. Woodbridge, uh, Corktown, North Corktown, uh New Center area, and like the this golden ribbon west of you know, Midtown uh, you know, just seems to make the most sense because there's available land, uh the number the you know, the numbers are reliable as far as the end, you know, uh prices that buyers will pay. Um, so that that seems to be how we um, you know, we're just really doing well with that sort of niche. Uh certainly, you know, we could work with any condominium developer if whether they wanted to do something downtown, you know, in the central business district or midtown. And we've analyzed a lot of projects, um, but it seems to be, I think at one time they were calling it like the 7.2, it was like the 7.2 square miles around downtown that included a lot of like the bigger named neighborhoods. Um, you know, I think anything kind of in that area, East Jefferson Corridor, is um probably appropriate. Anybody trying to do something outside of that, it's going to be a little bit more challenging. Although we, you know, we're working with the developers now that we're supporting who's who are doing something in like Piety Hill. So we're going to start seeing, you know, just beyond those other neighborhoods, we're going to see start seeing development projects um happening. That's interesting. That's really interesting.
SPEAKER_01Wow. We're going to have to get a little, yeah, we're going to have to get those zip codes from you. So we can, yeah. Oh, we'll just send clients to you.
SPEAKER_03You could do that too. Yeah.
SPEAKER_00It's cool to see it starting to spread out, not just in that like main core that everybody's used to seeing things happening, but it's it's really starting to reach out into the neighborhoods, which is really what Detroit's going to need in order to support us long term. But I want to build on the initial, you know, topic that we started with, which is, you know, advice for new developers in acquiring land and how to go about that. But I'd kind of like to wrap up our conversation, asking you and your expertise, what advice would you give new developers coming to the table in these conversations? Like what do they need to look for first? How do they need to start thinking? And who do they reach out to?
SPEAKER_03Um, so I would say that um as a as a somebody who um was a brand new developer myself, um it's really tough. And so you have to make sure that you have the, you know, the stuff. Uh when everything goes wrong, are you gonna be curled up in a little ball or are you gonna be like, okay, there is a solution to be found and I will find it, you know? Um so uh so I think first, you know, just make sure that you know you feel like you have you have what it takes from that standpoint. Um the the development feasibility process is kind of a it's it's a it's a working process. You know, a developer might come to us and they have land and we say, okay, based on this location, the general idea of where you want to go with amenities and finishes, this is what you can sell for per square foot. And then, you know, we kind of like maybe go to an architect for a very basic site plan, you know, just the massing of something. And then they come, we come back and you know, maybe we, you know, we know basic construction, build cost, price per square foot. So then we say, all right, so you know, does this sort of basic framework work for you? No, that doesn't quite work. Okay, what do we need to add or take away is to either reduce the build cost, maybe we remove the balconies or we maybe add balconies, and that's how you'll change your price per square foot. So it's like a massage, you know, it's like you have to give it and take a little and kind of you're sort of massaging this piece of clay into something that, you know, it's not, it's not a slam dunk. It's like, how do we um, you know, how do we all work together uh to create something that makes the most sense for this site? So um I would say a developer kind of has to be open and trusting. We want somebody who is trusting our expertise and willing to listen to us. I think those are the biggest um, and you know, if they have absolutely no experience, you know, can we pair you with another developer that you know you can work with, especially if you already have land and you're not just looking to acquire something. You know, sometimes it's easier to pair people together to make you know everything easier, the financing and um and uh, you know, and all of that and the abatements and things like that work better.
SPEAKER_00Yeah. That last comment is huge. I mean, that's really what we've seen a lot of two things that we have seen as an architecture firm supporting a lot of developers, many of them uh first time. Uh, and that's that's you have to partner with somebody who has the experience and has done this time and time again. And we're seeing a lot of uh I would say kind of rethinking the design, either scaling back the design, like Leslie was talking about, really uh thinking about those amenities and what those amenities mean to the users of your building. Uh, it's been a while since I've designed a gym for uh an apartment complex, or swimming pools for that matter, for an apartment complex. It's like those bells and whistles of kind of those are the things that take the hit when we get into these more challenging moments that were onset by COVID. Uh, and then phasing, phasing a project instead of taking this huge development all at once. It's like, yeah, why don't we bring it down to three stories or less where you only need one fire-rated exit? You can maximize the exterior windows on a building, get a better footprint, a better layout, uh, more spacious ceilings instead of bigger footprints. We've had a lot of transition to to more thinking about volume of spaces, not just area of spaces. And a combination of those plus working with somebody who has experience in order to build on their portfolio to gain that confidence with banks, with municipalities, with general contractors, and so on and so forth, it's kind of been the winning combo, at least in in the the clients that we have been working with. Leslie, anything else you'd like to add to that?
SPEAKER_01No, I think that um this has been super helpful, Jan. I can't wait to have you back on. I think you could actually be a really good regular and I just because of your knowledge base. And you know, it's always good. We we do very well when we have guests like yourself, primarily because it's not just us talking about our experience, but it also brings a whole other light. It sheds light on really what the actuality of real estate is in this country. And I think Detroit is a good reflection of what's going on. I really do on so many levels because of all the different pockets from the 7.2 mile area all the way to the areas where they're just gonna designate as agriculture these days. So um I think uh Claire, what do you have? Um I have no other questions for now, but I uh is there anything final that you would like to share? Um and I know Claire's gonna wrap it up and ask you probably the same question.
SPEAKER_03Um I uh, you know, I I guess what I would say is I'm guided by service. So, you know, I'm I'm always happy to have people reach out to me. Um, we'll share my contact information. Um and uh I'm also um like uh property taxes in Detroit is like another totally bizarro uh you know puzzle to navigate. And I have some expertise. So I'm also happy to provide some expertise and thought there. If anybody ever needs help with anything related to that, happy, happy to have to reach out to me. Awesome.
SPEAKER_02Thank you so much for coming on, Jan. I agree with Leslie. We would love to have you back whenever you want to hop back on here and give give the updates. Um, what I would love to share with everyone listening is that we're gonna have Jan's contact information down below in the podcast description, along with the a link to sign up for her newsletter so you can stay looped in with her. And we'll also have a contact form linked down below for our team as well. If you're looking for architectural services or if you just want to check out any of these projects that we've referenced through the episode, we've got all of our links down below, and we will see you in the next episode. We hope you enjoyed this episode. And if you found it so valuable you want to connect with us one-on-one, click the link in the description to tell us all about your project so we can help you get started. And to get notified on the next episode here on Innovative Real Estate, go ahead and subscribe to the podcast on iTunes so you never miss a beat. Get out there, put today's advice into action, and we will see you in the next episode.