Wealth Opportunities in Commercial Real Estate: Management, Financing, and Marketing of Investment Properties

Governmental Approvals

In general, before any major work can be done, a permit is required—although it might be permissible to do some minor improvements to the site first. For example, at times, a municipality may issue a grading permit over the counter without full plans and specifications, but this is an exception rather than the rule. In most jurisdictions, the time frame to obtain governmental approval for a new project has increased over the last few decades. Residential projects can take years; commercial approval is usually measured in months, that is, usually three to six months.

Development is tied into governmental approvals. The nature of what can be built, as well as specific zoning regulations, access rules, permissible use, set backs, density, height restrictions, parking requirements, floor/area ratios (FAR), hours of operation, and so on are all a function of the applicable codes and of what the planning commission and city counsel will allow. If you desire to build a project, it is therefore crucial, if at all possible, to establish a working relationship with the local homeowners associations and other citizen groups as well as with city planners, the city manager, the city attorney, and the members of the city counsel. Having a dialogue with and listening to the needs and desires of these key players is very helpful in achieving what you desire to accomplish. Litigation, although unfortunately all too common in residential development, is infrequent in a commercial ...