Looking for a free property development business plan template? Here's what to do!
This section of your plan should be a bulleted list summarising the main points of the plan. It is intended to give a reader -- be it a potential investor or a bank manager -- an overview of your proposed project at a glance.
Make it sound attractive but don’t hype your project. If you feel you have to do that to make it sound attractive then you should ask yourself whether the project is worth doing!
It may be best to write the rest of the plan and do this bit last.
Your executive summary should contain the following:
This is your chance to sell the project to your investor. Remember that your potential investor is interested in what is in it for them.
Include all relevant facts and supporting information, photos, plans and schematics.
A detailed description of your project from a practical point of view. Include the following:
Will planning permission or any licences be required, if so have they been applied for? If planning an HMO / multi-let, will you require a licence?
What permits are already in place and which ones need to be applied for?
Will architects be required for the project? If so has an appropriate one been sourced? Have they done similar previous projects? What will they add to the project?
What contractors and / or suppliers will be required? Have quotes / costings been solicited?
What is the realistic schedule for the project. Include relevant project milestones.
How will the profit be realised? Will you...
What is the back-up exit strategy. All smart developers have a plan B, in case the market changes.
What are the potential risks to your project? How will you manage them if they occur?
A full financial analysis for your project. You may want to attach a separate spreadsheet. Be sure to include the following costs:
How often and in what manner (report / meeting / spreadsheet?) will your investor be updated on your progress?
When you’re done, be sure to get your advisors to review your plan for you.
I'd love to hear about your project -- drop me a note in the comments below!
John Wilson here from Property Investment Blueprint and just a quick one today. I want to talk about property development business plans and what should be in one and why you need one?
Well, first of all, you need a property development business plan for two main reasons first of all for yourself for your own benefit, so that you know the scope of your own project and you get everything straight in your own mind about where you're going. How much profit you're going to make.
And the whole thing is to keep you on track throughout your project. And to help you understand if the project is going to be worth doing. As well, you know, you might find in the process of doing your plan that it will actually not be profitable. So important from that respect. Also important if you are going to be seeking funding for your project.
If you're going to be going to lenders or private lending, joint venture partners, then is important for you to set out exactly what you're going to do and what's in it for the investor as well, for you to be able to convince an investor, this is a good idea. Or a joint venture partner.
You obviously need to set out the project in the best light as well and let them know that you know what you're doing as well that you've thought of everything and got it down on paper. So that's the two reasons why you might need a property development business plan.
Now, what should be in a business plan for property development. Well, certainly these things perhaps not limited to these things, but first of all an executive summary so that when somebody opens up your plan, they can see at a glance the nature of your project and what it's all about, without having to read through the whole thing.
A description of the development: you should talk about the location of the development the current state of the site, you know, is it a bare piece of land? Is it a rundown property, that kind of thing? What's the scope of the development? What are you actually going to do to the to the site or the building?
And you know, a picture is worth a thousand words. So have have some photos in there if possible as well that will really help people imagine or see exactly what is being dealt with here.
Planning permits: you need to talk about are you going to need are you going to need permission, planning permission for this? Are you going to need any other kind of permits like an HMO license or licenses for doing serviced accommodation, things like that? Those things need to be researched and detailed in here as well.
Architects. Are you going to be using an architect? Do you have one selected? Have they done similar projects before? What are they going to add to the project?
Talk about contractors. Have you approached contractors? Have you solicited quotes? Have they come back with quotes? That sort of stuff needs to go in there.
Timescales. What are the Timescales for the project? And what are the milestones that you are going to expect to hit throughout the project?
What's your exit strategy? So are you going to be selling on the open market? Are you going to be refinancing? Are you going to be letting the property out? And then you need to think about your backup exit strategy. You know, what if the market changes? What if you have to rent the property out instead of selling it? That kind of thing.
Risk analysis: you need to think about what types of things can go wrong in your project. Describe those and then talk about mitigating factors. How you can mitigate. How you can lower the risk of something happening and and how you can deal with it if it does happen. So that's something that any joint venture partners or lenders are going to want to know that you thought about. And thought about in great detail before going into a project.
And finally financials obviously, you need to go into great detail about your financials for the project. And again this this should include but not be limited to things like: licenses, engineers, architects, builders, tradesmen, estate agents, letting agents. All the costs associated with those items.
So that about ties it up. As I say, there may be other things that you may decide to include on a per project basis, but that's it in a nutshell.
Now, if you need a property development business plan for your project and you would like a template we have one for download available for free and you can get that at when you join our newsletter at freepropertystuff.co.uk that's freepropertystuff.co.uk.
So that's it for today and I will speak to you next time.