Site Selection and Acquisition
Did you know that locations with access to high traffic areas not only increases the bottom line, but reduces expenses through economies of scale? There may also be tax advantages and financial incentives in one location vs. another. It is our job to understand the site or work with engineering experts to discover the right location and perform the necessary site evaluation and recommendations as to whether the area is suitable for development pursuant to the desired objective. Zoning, unit density, soil types, utility availability and wetlands are among the factors we consider in evaluating a prospective site.
Feasibility Studies and Financial Return Analysis
GDC’s staff prides itself in its ability to properly project development costs, identify and manage risks, and analyze returns. GDC maintains a large database of previously developed projects that is utilized and adjusted to create and verify the cost estimates of each prospective project. Furthermore, Ginosko Development Company also coordinates and scrutinizes cost estimates and timelines during the design process, to ensure the development costs, scheduling and other factors are projected appropriately and remain within scope, budget and benchmarks during the life of the project. We also work closely with the entire development team to analyze potential risks and how to mitigate each and every one identified. This includes understanding the various building components or site features that need to be evaluated for risks related to casualty or liability losses in order to ensure the best insurance and risk mitigation strategy resulting in reduced insurance premiums. This also includes understanding potential changes in equity markets, debt markets, the direction of the economy, construction and labor costs and availability, rents and absorption rates and other risk areas.
Prior to closing, it is critical that we perform a feasibility & recommendation report for each development. This report includes key financial projections, SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats), and Recommendations. This report has also proven to be critical in securing various loans and other financing sources.
Since the early 1970’s, Congress has recognized a need for economic incentives to invest in various types of housing, particularly affordable housing. Being an experienced owner of projects that utilize these congressional benefits, GDC has the ability to tap into many of these incentives. Our staff assesses each project and evaluates whether and how it can qualify for these funds. Should we determine that it qualifies; GDC compiles, completes, and submits the necessary documentation.
Site Plan Approval
Is the local government happy with our idea? GDC’s staff is very experienced in successfully obtaining site plan approval. We compile and complete the proper plans and applications to the appropriate local government departments. Furthermore, GDC’s staff communicates with government officials and brings our long-standing history of quality experience to advocate for our idea at approval-process meetings.
Sufficient demand for the prospective location is another important factor in any project. Ginosko Development Company has assisted non-profit organizations, municipalities, government agencies, and financial institutions with the development of and strategic solutions for housing alternatives across the country. Not all market studies are created equal. Our years of experience make a crucial difference when applied to selecting the right consultant, coordination and evaluation of a market study. We form reliable conclusions from careful analysis of data provided to our team of experts.
Project Design and Value Added Engineering
Is the project designed in the most efficient manner? Ginosko Development Company collaborates with the architect and engineers to ensure that the latest in housing design techniques and technology are employed on each development.
Color and Decorating Selections
This phase of the project is one of the most rewarding. The difference between a very successful project and a mediocre one has a lot to do with color and decorating selections. No development is ever complete without quality decorating and coordination of interior and exterior materials and colors. GDC selects the appropriate colors and decorating schemes in order to maximize the marketability of each project.
Zoning and Environmental Issues
Once a perfect location is found, our team navigates the numerous municipality and environmental issues facing each project. There are many factors that could significantly impact the feasibility of a project, from zoning ordinances to environmental issues such as hydro-geological, geotechnical, Brownfield development, pavement and roofing design, construction materials testing, and special materials evaluation. Our expertise in choosing the right environmental consultants as well as evaluating the information provided can be the deciding factor in project implementation.
Rehabilitation and Preservation
A short drive through most cities will reveal that there are many buildings that have exhausted their initial use and are in need of repair. For the most part, recycling projects through rehabilitation can be more cost effective than building new. Rehabilitation has become an area of specialization, requiring qualified professionals who have garnered experience with lead paint remediation, asbestos abatement procedures and removal of underground storage tanks. Urban filled sites require additional knowledge of state and federal environmental laws. Ginosko professionals combine years of experience and technical expertise to bring innovation and practical solutions to take advantage of the special opportunities rehabilitation affords.
Ginosko regularly updates its vacant land database to stay on top of new construction opportunities. Though it may seem like new construction starts with a blank slate that allows for any possibility, GDC knows better than anyone that each parcel of land has its own unique benefits and challenges and develops a strategy to capitalize on those benefits and minimize those challenges. Most people think a successful real estate project is about location, location, location. GDC’s approach is strategy, strategy, strategy. You can have a perfect location but you can’t have a perfect real estate project without developing the appropriate strategy and implementing that strategy successfully.
One of the largest expenses in a development is the construction costs. As Construction Manager, GDC along with the Architect and General Contractor work as a team regarding the selection of materials, building systems and equipment. GDC provides recommendations on construction feasibility; actions designed to minimize adverse effects of labor or material shortages; time requirements for procurement, installation and construction completion; and factors related to construction cost estimates of alternative materials and preliminary trade payment breakdowns.
Certified 501(c)(3) tax exempt organizations have been given special preferences by Congress. These preferences enable nonprofits to more easily compete for funds and to obtain favorable treatment of certain non-recourse financing. Ginosko’s long standing history with nonprofits in housing has furnished trustworthy counsel and cultivated client confidence. GDC helps our nonprofit partners take advantage of these special preferences.
Before even determining whether or not a project is feasible, developments at their conceptual phase can cost over $150,000. Ginosko Development Company regularly provides pre-development funding for each project we are involved with.
Loan Documents and Due Diligence
GDC recognizes that obtaining financing at satisfactory terms is a very difficult process. However, GDC understands the loan underwriting process and how to select the best loan program available, securing the best terms and financing rates for the project’s development needs. Furthermore, we compile and complete the proper loan applications and due diligence underwriting documents, walking through every step of the process – from program selection to loan closing. We have extensive experience with conventional, FHA/HUD, FNMA, GNMA, MSHDA, tax-exempt bond direct and pass-through loan programs and have worked with several different lenders and government agencies. Our familiarity with their underwriting procedures, due diligence requirements, forms, documents and staff members makes for a smooth loan financing process.
Private Equity and Opportunity Zones
Ginosko Development Company has successfully utilized private equity funds as part of the financing structure of our developments. We work closely with investment groups to evaluate company ownership structure, cash-on-cash preferred returns, projected IRRs and the waterfall of benefits investors are looking for. We also enhance the strength of those projected results through evaluating and mitigating the various risks to a project and maximizing rewards available. We constantly evaluate potential changes in equity markets and stay on top of changes in legislation in order to maximize equity to the project and returns to investors. Ginosko was one of the first groups in Michigan to successfully close an Opportunity Zone Fund so that investors can utilize the tax benefits of this newly available program. We were at the forefront in analyzing and understanding the proposed legislation so that when it came out we were able to implement and take advantage of this Opportunity Zone designation before everyone else had even heard of it.
Housing, Historic, and Brownfield Tax Credits
Most of our projects provide housing for families defined as “Low Income” by the Government. A key source of financing that can be utilized to help pay for development costs is Low Income Housing Tax Credit equity, as well as Historic Tax Credit equity or Brownfield tax incentives. Equity funds are raised through the sale of Low Income Housing or Historic Rehabilitation Tax Credits, or an allocation and monetization of Brownfield incentives, and GDC has the expertise to acquire and successfully implement the needed equity.
Ginosko Development Company’s staff has a long history of successfully closing real estate acquisition transactions, giving us an edge over other buyers and instilling confidence in sellers and brokers as to our ability to perform and execute. As a result, GDC has developed strong procedures for reviewing, compiling, and coordinating the myriad of closing documents. Moreover, GDC works closely with trusted and experienced attorneys throughout the closing process and project implementation.
It is crucial that draw applications are prepared accurately and timely to ensure that construction or rehabilitation efforts continue smoothly. Therefore, GDC prepares, validates, and submits the appropriate documentation to various lending sources and accountants to help expedite payment and ensure accounting accuracy.
Now it’s time to implement the market study. If the market study was carefully scrutinized and validated, the project should not have a problem in its marketing efforts. GDC works with the qualified management company to ensure that the market study is fully implemented and projected occupancy rates are exceeded.
Final Closing and Project Stabilization
Congratulations! Ginosko Development Company has turned concept into reality. The reward of meeting the needs of the tenants utilizing the property brings great satisfaction. At this point, construction has been completed, tenants have been certified and qualified occupancy has been attained, and the final step is closing the construction loan and converting to a permanent mortgage. GDC works with the property management company to ensure project stabilization benchmarks are achieved, and works with experienced attorneys to review, compile, and coordinate the myriad of permanent loan closing documents.
Property and Asset Management
We know what to look for in a quality management/marketing company. When monthly operating reports come across our desk, we know how to dissect the data and recognize potential problems. GDC staff knows the answers. GDC knows what to expect and what to demand from a property management company. We solicit and review management proposals, select the best company and negotiate the management contract.Ginosko Development Company also performs Asset Management functions by “Managing the Management Company” during the life of the project.