Real Estate Development. 6 REAL ESTATE DEVELOPMENT
Real Estate Development. Purchase or acquire, or agree (pursuant to a binding agreement) to purchase or acquire, the obligations or stock of, or any other interest in, or make loans, advances or capital contributions to, or form any joint ventures or partnerships with, or make any other expenditures with respect to, any Real Estate Development Project, if, in the aggregate, the total project costs required to be made in connection with all such purchases, acquisitions, loans, advances, capital contributions or expenditures would be greater than $100,000,000, at any one time, or permit any Subsidiary so to do.
Real Estate Development. A Real Estate Development is a residential subdivision, mobile home park, apartment complex, planned area Development, mixed-use or other similar type Development consisting of four or more contiguous lots recorded with the appropriate county registry where permanent electric service will be provided to four or more members.
Real Estate Development. None of the Borrower, the Guarantor, or any of the Subsidiaries of the Borrower, or any subsidiaries of such Subsidiaries, shall (a) engage in the business of real estate development as its primary business, or (b) invest in or become a party to any real estate joint venture, partnership or other joint enterprise that would be reflected on a consolidated balance sheet of the Borrower and its Consolidated Subsidiaries; provided, however, that nothing contained herein shall limit or restrict the ability of the Borrower, the Guarantor, or any of the Subsidiaries of the Borrower, or any subsidiaries of such Subsidiaries, to contribute real estate assets to any such joint venture, partnership or other joint enterprise, so long as such contribution is the only obligation or duty (other than administrative obligations or duties such as reporting requirements) of the Borrower, the Guarantor, or any of the Subsidiaries of the Borrower, or any subsidiaries of such Subsidiaries, related thereto.
Real Estate Development. Real estate development is a complex business with a lot of moving parts. Like all businesses, it is dependent on and affected by global and local conditions, over which the developer has little or no control. When embarking on development agreement negotiations, it is important for public officials to have an understanding of the real estate development business and the developer’s needs and interests. By showing the developer a level of business savvy, municipal officials can come to be viewed as collaborative partners, as opposed to obstacles to be overcome. Among the many global factors, first and foremost is the general state of the economy. What is the condition of the economy? Is it expanding or contracting? If it is expanding, there will likely be overall demand for new housing, offices, and factories. Contracting economies will experience the opposite effect, with buildings sitting vacant or abandoned. Another factor is labor supply – do area workers have the requisite skills, are they available in sufficient numbers, and do they exhibit high levels of worker productivity? Higher worker productivity in a particular location can be more beneficial than a lower labor cost in another location. The balance between productivity and labor costs is becoming an important factor in deciding whether a company expands in the US or overseas. Among the multiple local factors that affect real estate development, space availability is of primary importance. What is the supply and demand for a particular real estate product (for example, Class A office, flex space, multifamily housing, etc.)? Rents and vacancy rates are often used to measure demand for space. Of secondary significance is timing. How long will it take a developer to get local approvals and construct the project? Timing is critical - a developer who gets its product on the market fastest can take advantage of demand, whereas a developer who is slow to market may miss the window of opportunity. Third is raw land availability. What is the availability of land in the appropriate size and condition? A developer who can secure a parcel with the right location, entitlements, and infrastructure expeditiously wins out over one who has to assemble several parcels into an appropriate site, lay in new infrastructure, and secure special zoning permits. Like all business people, developers want to reduce the amount of risk and minimize uncertainty in the development process. Developers are betting their time an...
