Andy Haines S & A Homes November 14, 2016 Construction Costs - - PowerPoint PPT Presentation

Andy Haines S & A Homes November 14, 2016

 Construction Costs and Trends  Development Perspective

• Hard & Soft Costs
• Operations
• 15 year
• PHFA
• Equity Challenges

 Hard- see my previous slide  Title Insurance over $50k per project  Insurance costs double non LIHTC deals  Consultant fees for Energy Audit  Tap Fees, Municipal Review Fees  More design, more time, longer construction

periods

 Management face same challenges as other

businesses, employees, health care

 Maintenance of more intricate systems

• Outside/Third Party maintenance

 Shorter life term of systems  Tax Appeals  Tenants- 1/10 pass our litmus test  Energy Efficiency/utility costs

 “There is no way the US will elect an African

American to the presidency”

 “ There is no way the US will elect Donald

Trump to the presidency”

 “ I will not be as grumpy as my Dad”  “Someone else will be here in Year 15”  “There is no value in these deals at year 15”  “ the investor will be reasonable and just

wants to get out of the deal”

 Investor view value in deals at year 15  Yorkshire Village Lesson

• Valuation
• Current rents v Max 60% Rents

 PHFA

• Forward allocation
• Staff turnover
• Carryover/ 8609’s
• Next year

 Investors

• Pricing very aggressive
• Due Diligence aggressive
• More knowledge of risks
• Operating Reserves