If you're just getting started in the field of real estate development, you're probably aware that there are a number of new terms you need to learn to be successful. When you understand words like debt to equity ratio, community development and zoning, you'll have a better idea of how much property you can afford to buy and what you can do with it. In commercial real estate development, misunderstandings can be costly, so make sure you learn the terms.
Association of Commercial Real Estate (ACRE)
The Association of Commercial Real Estate, or ACRE, is a professional organization for those in the commercial real estate business, including developers. It offers a good opportunity to network and learn the latest trends.
When cities and towns have a depressed economy, the effects can be felt by everyone living there. Community revitalization projects can help turn a city around, restoring it to its former glory.
Community development refers to the process of making a particular area nicer, especially for low to middle income families. Development companies that focus on community development may be eligible for funding from the government.
Debt to equity ratio
The debt to equity ratio is a comparison of how much debt you have with the amount of equity you have in a property. A high debt to equity ratio means that you'll have a harder time getting a mortgage with a good rate.
Zoning affects what you can do with a property. The zoning regulations are set by the city government. For example, you may not be able to establish a residential home in a commercial zone.
Before you start making plans for a development project, it's important to make a market assessment of the area. For example, knowing the average age of local residents will help you decide whether you're marketing towards young families or senior citizens.