Accessibility refers to the ease and convenience with which a property can be entered by customers, tenants, and other users, particularly through automobile access. It also entails building design and alterations that enable individuals with physical disabilities to enter and maneuver within the building.
An Acquisition, Development, and Construction (ADC) Loan is a short-term loan used to finance the acquisition of land, development of infrastructure, and construction of buildings.
An advance commitment is a promise to take specific action at a future date with predefined terms. It's commonly used in real estate to secure financing for projects, often before completion. Understanding different types of advance commitments can be crucial for developers and investors.
Appropriation in real estate refers to the setting aside of land for a public use or to the allocation of funds by a budgetary authority for a specific purpose.
Assemblage is the process of combining two or more adjoining parcels of land to create a larger, more valuable piece of property. The new, larger tract may have a higher collective value due to its potential for enhanced usability or development.
In real estate and construction, backfilling is the process of refilling a previously excavated area with soil or other materials. It is a crucial step in construction to ensure stability, proper drainage, and to support structures.
Betterment refers to an improvement made to a property that enhances its value, utility, or physical condition. This term is commonly used in the context of real estate to describe upgrades or modifications that increase the overall quality of the property.
A Bill of Assurance is a legal document containing a collection of restrictive covenants that apply to a group of contiguous lots, ensuring specific standards and regulations for development and property use.
A blanket mortgage is a single mortgage that covers more than one parcel of real estate, often used by developers to finance multiple properties under a single loan.
Bleeding a project refers to the unethical practices in real estate development or management where expenses and fees are overstated to increase profits or where routine maintenance is neglected to maximize current income at the expense of property value.
A Blue Top Lot refers to a parcel of land that has achieved specific legal and physical readiness for development, typically including entitlements, grading, and close proximity to utilities. Variations exist in definitions regarding the presence and status of street improvements.
Build to Suit is a contractual arrangement where a landowner agrees to construct a building based on the specifications of a tenant and then lease both the land and the completed building to the tenant. This allows tenants to customize space without the upfront capital expense of buying and developing land.
A building line is a designated boundary at a specific distance from the lot's front and/or sides beyond which the construction of buildings is restricted. It ensures uniformity and compliance with zoning regulations.
A building lot is a parcel of land designated for building purposes, typically within a defined community, subdivision, or urban development plan. These lots are often equipped with the necessary infrastructure and utilities such as water, electricity, and sewer systems.
The intangible value inherent in a business apart from its tangible assets, which encompass buildings, land, and fixtures, and also the overall value of a business in its entirety, consisting of all its parts, both tangible and intangible.
Capital calls are additional money requested from equity owners to bridge deficits in construction or operating costs. These calls often happen due to initial underfunding or unforeseen expenses.
Carrying charges refer to the ongoing expenses necessary for holding a property, such as taxes, interest on loans, insurance, and maintenance costs. These charges are pertinent to both idle properties and properties under construction.
A census tract is a geographic region defined for the purpose of taking a census, which is typically delineated by the U.S. Census Bureau to capture detailed demographic data about residential areas.
A change order is an amendment to the construction plans after they have been finalized. This process can often lead to increased costs and timeline extensions.
Cluster Housing is a subdivision technique where detached dwelling units are grouped closely together, leaving shared open spaces as common areas. This design promotes community interaction while preserving natural land and creating more efficient land use.
Colonias are rural community settlements in the United States, particularly in the border regions of Texas, New Mexico, Arizona, and California, characterized often by substandard infrastructure and housing conditions.
A Commercial Mortgage Loan is a loan secured by real estate that generates business or rental income, typically used in transactions involving commercial properties like office buildings, shopping centers, or warehouses.
An advance commitment is a financial pledge or guarantee from a lender to a borrower, often used to ensure future funding for a project under specified conditions.
A Completion Bond is a legal instrument designed to guarantee the completion of a development according to predefined specifications. It extends beyond a performance bond by ensuring the production of the entire development without reference to specific contracts and without requiring payment to the contractor.
Conditions, Covenants, and Restrictions (CC&Rs) are documents that control the use, modifications, and appearance of properties within a particular real estate development or community.
The process of converting rental apartments or other types of multi-unit buildings into individually owned units usually under a condominium structure.
Consequential damages refer to the loss in value of a property caused by the taking of a nearby property or development on another property. These damages may not be directly caused by an action but occur as a consequence of it.
Construction lenders specialize in providing construction loans, which are short-term loans used to finance the building or renovation of real estate projects. They differ from permanent lenders who provide long-term financing solutions once a project is completed.
A Construction to Permanent Loan (C2P) is a financing arrangement that transitions seamlessly from a construction phase to a permanent mortgage, eliminating the need for multiple loans and reducing overall costs. This type of loan is crucial for bridging the time gap between the completion of construction and the availability of permanent financing.
A contour map is a type of map that highlights the topography of a site using contour lines to indicate various elevations. It helps in understanding the terrain by representing how slopes and elevations are distributed across an area. Often used in real estate and land development, contour maps are crucial for planning before construction and making informed decisions regarding land use.
A contractor is an individual or company that agrees to supply goods or services under a contract, usually related to the development or renovation of a property. Contractors play essential roles in various aspects of construction projects, such as landscaping, carpentry, plumbing, and architecture.
A converter is an active real estate entrepreneur who changes the ownership and/or physical configuration of property. Converters often transform properties into different usage types or upgrade them to increase their value.
Cumulative zoning is a type of zoning ordinance that permits lighter or less intense uses within areas designated for heavier or more intense uses. This can foster a mix of density and usage, potentially allowing for greater flexibility in urban planning and development.
A custom builder constructs unique homes based on client specifications and architectural designs, offering bespoke solutions different from production or tract houses.
De Minimis Planned Unit Development (PUD) refers to a type of PUD where the common area characteristics have a minimal effect on the overall property value. These developments contain limited shared spaces and amenities.
A Declaration of Condominium Ownership is a legal document required for the establishment, management, and governance of a condominium association according to relevant state laws. This document outlines the rights and responsibilities of unit owners, common areas, and the owners' association.
Demographics relate to the characteristics of a population such as race, sex, age, household size, growth, and density, which influence market trends and demand in real estate. Understanding demographics is essential for developers to make informed decisions about new projects and strategic marketing.
Density in real estate refers to the intensity of land use, often quantified as the number of dwelling units, residents, or floor space per unit of land area. It is an essential aspect in urban planning and zoning regulations.
Developer profit is the anticipated increase in value created by a real estate developer. This profit represents the difference between the final market value of the developed real estate project and the aggregated costs of materials, labor, and overhead.
Downzoning involves changing the zoning classification of a tract of land to a less intensive use than currently permitted. It can affect the owner's investment-backed expectations and may raise compensation issues.
A draw refers to the periodic advancement of funds from a construction lender to a developer according to a pre-arranged schedule, either at regular intervals during construction or after the completion of specific segments of the project.
A dummy corporation is an entity established to facilitate business transactions on behalf of a principal by superficially holding certain assets or liabilities.
Economic feasibility is a crucial component of a Feasibility Study that evaluates whether a proposed project or investment is financially viable and worth pursuing.
An equity kicker, also known simply as “kicker,” is a form of equity participation that lenders or investors can demand as part of a loan agreement. It provides the lender the right to share in the future success of the borrowing venture, typically in the form of a percentage of ownership or profits.
Exclusionary zoning refers to municipal regulations that effectively bar certain types of housing or people from living in certain areas, predominantly limiting access for low- and moderate-income individuals.
A feasibility study is a detailed analysis aiming to determine the viability, risks, and profitability of a proposed real estate development, ensuring that the project fulfills investors' objectives and aligns with market demand.
A Final Plat is a detailed map that provides the specific boundaries of each lot and utility easements in a subdivision, suitable for public recording. It marks the transition from conceptual planning to legally recognized property descriptions.
A Finished Lot refers to a parcel of land that has been prepared for immediate construction with essential infrastructure, legal clearances, and utilities in place.
A firm commitment is an irrevocable agreement in which one party commits to performing a specific act, typically in the context of lending, ensuring that financing will be provided under predefined terms.
A fixed bid is an estimated cost, based on plans and specifications, that also stands as the actual cost of the job, regardless of any fluctuations in the actual cost of materials and labor.
A flag lot is a method of subdividing land into individual parcels in such a way that compliance with local subdivision regulations can be avoided. Owners define each lot with a minimal amount of road frontage to gain exemptions and avoid regulatory compliance and expenses.
The Floor-Area Ratio (FAR) is a measure of building density that assesses the total floor area of a building in relation to the size of its land parcel. It is commonly used in urban planning to control the massing of buildings and to ensure appropriate land use.
The floor-area ratio (FAR) measures the relationship between the total square footage of a building and the square footage of the land area on which it is built. FAR is regulated by zoning codes and can significantly impact land value and development potential.
The footprint of a building refers to the shape, orientation, and outline of the ground floor area of a structure within a given plot of land. It influences the overall arrangement and environmental impact of the building on the site.
Front money refers to the initial capital required to begin a real estate development project. It includes funds needed for tasks like site acquisition, planning, permit acquisition, and securing loan commitments.
A general contractor is a professional responsible for overseeing the construction of buildings or other improvements for owners or developers, often coordinating the work of various subcontractors.
In the realm of real estate and construction, grading refers to ground level adjustments and the preparation of a smooth surface on a site, generally for the purpose of laying a foundation.
A Guesthouse, also known as an accessory apartment, is a secondary housing unit on a single-family residential lot. These units provide additional living space and can serve a variety of purposes, including housing for guests, rental income, or living space for extended family.
Handicapped Access refers to the design, modification, or provision of facilities ensuring that they are usable by individuals with disabilities, complying with legal standards and offering equal opportunity and access.
In real estate, a holdout is a landowner in the path of an assemblage who seeks the highest possible price by refusing to sell in the early stages of the process. This often involves strategic negotiation to maximize land value, especially during large-scale property development projects.
Housing completions refer to the number of new housing units that are completed and ready for occupancy. This metric is reported by the U.S. Census Bureau and reflects construction progress in the real estate market.
A Housing Permit is an authorization issued by a municipality that permits a builder to construct a house or apartment. This approval ensures that all local regulations and codes are adhered to, including safety, zoning, and infrastructure requirements.
Impact fees are charges levied by a city or county on developers as a condition for granting permission for development projects, typically to cover the costs of expanding public services to accommodate the new development.
Indirect costs, also known as soft costs, refer to expenses that are not directly associated with the physical building structure but are incurred during the construction period.
Insulation involves materials used to slow the transfer of heat through walls, roofs, and other elements of a building to reduce energy costs and help maintain a uniform internal temperature.
A global organization dedicated to promoting private property rights and fostering international real estate investment and development.
An organization devoted to the exchange of information and ideas pertaining to land economics, fostering a network of professionals engaged in various aspects of land use, development, and conservation.
A land lease community is a type of housing development where homeowners lease the land under their homes from a landowner who often provides community infrastructure and amenities. These communities are commonly associated with manufactured or mobile homes.
Land reclamation is the process of creating new land from oceans, seas, riverbeds, or lake beds. This process is used for various purposes including agricultural, industrial, residential, and infrastructural development.
Land Use Intensity (LUI) refers to the extent to which a land parcel is developed, considering the conformity with zoning ordinances and regulations.
Land Use Succession refers to the change in the predominant use of a neighborhood or area over time, often driven by social, economic, and environmental factors. This process can significantly alter the character and demographic makeup of a region.
A Landscape Architect is a professional who designs building sites, subdivisions, and other projects requiring expertise in areas like drainage, grading, vegetation, installation of utilities, and site improvements.
Low-income housing that meets specific criteria and regulations, making it eligible for special tax credits. Stringent guidelines govern tenant qualification, certification, and project financing to ensure compliance with federal and state laws.
Manufactured housing refers to homes that are built in factories and then transported to a specific site for use. These homes must pass federal inspections in contrast to mobile homes, which often have fewer regulatory requirements. Manufactured homes often include modular housing options.
Market Area refers to the geographic region from which one can expect to draw the primary demand for a specific product or service offered at a fixed location. It helps businesses and developers comprehend and delineate their potential customer base.
A marketing plan is a formal strategy used to sell a property, which includes an advertising strategy, identification of a target market, and a pricing scheme.
A master plan is a comprehensive document encompassing the development concept for an area or project. This document includes narrative and maps that detail the current and future use of the land. It is often prepared by local governments to guide overall development or by developers for specific projects.
Mezzanine generally refers to an intermediate floor in a building that is smaller than the other floors, and it is often set back from the outer walls of the building, giving it a partially open view of the floors below.
Milking a project, also known as bleeding a project, refers to the extraction of financial resources or benefits from a real estate project without reinvesting or contributing towards its development and sustainability.
Minimum lot area refers to the smallest building lot area allowed within a subdivision, usually determined by a zoning ordinance. This requirement helps to establish the maximum building density for the subdivision.
A mixed-use property combines different types of land uses, such as residential, commercial, and industrial, into one cohesive development. This approach aims to create synergies between the various uses to enhance the overall functionality and convenience of the site.
A model unit is a representative home, apartment, or office space created to demonstrate the design, structure, and overall appearance of units within a development, primarily used as part of a sales or leasing campaign.
Mortgage Out refers to the practice of obtaining financing in excess of the cost to construct a project. During periods of relaxed monetary policy, developers could mortgage out by securing a permanent loan commitment based on a higher percentage of a project's completed value, allowing them to borrow more than the development costs.
The NAHB is a trade association that represents the interests and concerns of home builders, developers, contractors, and related professionals within the residential construction industry in the United States.
NAIOP, the National Association of Industrial and Office Properties, is a commercial real estate development association that provides advocacy, networking, and education to its members.
The National Association of Industrial and Office Properties (NAIOP) is a leading trade association established in 1967, encompassing over 7,000 members who are developers, owners, investors, and related professionals in the industrial and office real estate sectors.
The National Association of Real Estate Editors (NAREE) is a prestigious organization that brings together journalists, editors, and communicators covering various aspects of the real estate industry including residential, commercial, and green building sectors.
An Occupancy Certificate (OC) is an essential document that certifies that a building is suitable for occupancy and has been constructed according to approved plans and specifications, complying with relevant regulations and safety standards.
Expenditures related to construction that are spent away from the place of construction. Off-site costs can include expenses associated with extending utilities and infrastructure needed to service a development project.
Off-site improvements refer to the various infrastructural developments made to areas surrounding a specific land development or subdivision, necessary for its functional integration. These improvements can range from access streets and utilities to sewers and drainage systems.
Open Space refers to land within a developed area that remains undeveloped and serves as an amenity to surrounding occupants.
Municipal rules governing the use of land that provide specific regulations and guidelines for various land-related practices.
An outparcel, also known as a pad site, refers to a piece of property on the perimeter of a larger development, such as a shopping center, that is designated for singular commercial use.
Overimprovement occurs when a property is improved to a level that it exceeds the optimal economic use for that particular property, resulting in a value that is not supported by the surrounding community or comparable properties.
A performance bond is a type of surety bond issued by an insurance company or a bank to guarantee satisfactory completion of a project by a contractor.
A permanent lender provides long-term financing for real estate projects, typically following the completion of construction. Unlike construction lenders, who offer short-term loans for building and development phases, permanent lenders focus on financing properties for extended periods.
The act of clearing up a contaminated site, involving specialized techniques and compliance with regulatory standards. Often referred to as 'remediation.'
A platted lot is a parcel of land that has been surveyed and officially recorded on a final plat map, typically within a subdivision. This process includes specifications of lot boundaries, street locations, and utility installations.
Plottage value refers to the increased value that results when multiple smaller adjacent plots of land are combined into a single larger plot. This increase in value is due to the greater potential utility and development options that the larger plot offers compared to the individual smaller plots.
The term 'potable' refers to water or other liquids that are safe and suitable for human consumption. Potable water is free from harmful contaminants and meets the quality standards set by health authorities.
