Jlp development consultancy
Astute site selection • meticulous due diligence • risk management • value engineering • efficient and transparent reporting • asset management
With the economy facing significant headwinds due to dislocation in the credit markets and the negative effect on business conditions around the world, interest from many corporate developers and occupiers has collapsed, and property owners are increasingly faced with significantly reduced disposal values or a total absence of willing buyers for their property. In such situations, rather than sell out to a “vulture” purchaser it can often make sense for the owner to progress elements of the development process themselves to add value with a view to selling the enhanced or de-risked asset into an improved market at a later date. JLP Development Consultancy (JLP) can help to make the tough choices necessary to weather the storm and preserve value into the future assist owners in such situations either on a consultancy basis or though agreeing an Option to purchase.
Banks are increasingly concerned over erosion of value and its effect on Loan To Value (LTV) covenants and interest cover requirements. Where the LTV position has become critical, JLP can work with the bank or their work-out team to maximise the prospects of recovering the debt and identify the potential for additional value creation such as introducing an element of student, hotel, or other mixed use to a scheme.
In particular student accommodation is increasingly being touted as a lifeline to distressed residential developers. Whilst this will be a profitable and viable exit on some occasions, the location of many schemes does not necessarily lend itself to such use and developers and lenders should seek early advice from JLP before pursuing any such potentially flawed options.
Value Added Services
Competitor benchmarking / market headroom analysis;
Investigating rent / sale values being achieved in comparative developments;
Advice on any additional commercial space and rents and yields that may be achieved;
Desk top appraisal of alternative exit routes;
Commentary on yields valuers are currently applying to developments in the given city, so that an informal view on valuation can be suggested;
Review of scheme drawings with guidance on amendments / cost in conjunction with relevant sub-consultants;
Completion of banking and construction due diligence;
Identifying and introducing fresh equity partners to distressed situations.