- So when you're getting
ready to do a project
and you're in that exploratory
phase looking at land,
things like that, what are
the things you're looking for?
- Well, land is tricky
because it's a little bit like dating.
Something might appear attractive,
but you don't wanna be
married to it, right?
So you really have to
approach it cautiously.
- [Ryan] Sure.
- And this is gender exclusive.
This can go anyway.
But yeah, when you approach land,
there you really need to
have your head on straight
and you need to think beyond, it's like,
"Wow, this is a great location."
But then maybe the soil is really bad.
And there's ways to discover that
without spending a lot of money.
But you really, as you
approach a piece of ground,
and I won't say the
city but it's within two
or three hours of us,
a great piece of land.
It even had streets, all the
water and sewer were to it.
But what we found was, we noticed
that the sidewalk across
the street was super thick.
And then there was some repair work
that was happening in the street.
And we went over and looked
and we saw that the
asphalt not only was thick,
but the road mix that was
underneath it was extraordinarily,
and it looked like they
had to go down four feet.
So they had to remove four feet of soil
and then re-compact it
with a non-native soil,
foreign soil in.
And so all those indications to us were
that this soil is bad.
And so we walked away from that project.
To do that being a smart thing.
So when you approach a piece of ground,
you wanna make sure preferably
that sit in the city limits,
that if you can see curb,
gutter and sidewalk,
which is a common term that we use
when we're talking about streets.
Most cities require gutter
and curb and sidewalk,
so a dollar per lineal
foot that that runs.
But there's inexpensive common sense ways
that you can evaluate
land by looking at it
if you know what to observe in the area
of what's already there.
If you're new, and I have done
maybe 10 projects in areas
where there weren't
other developments around
and I'll look you straight
in the eye right now.
And I regret doing every
single one of those.
So I was the one that
was out the furthest,
I was that the next one
at the end of the line.
- Right.
- It's ended up being,
you would think that that
would be a natural thing,
but I really encourage
infill as opposed to urban.
- Being the outlier.
- Yeah, an outlier and
contributing to urban sprawl.
But the idea, the problem is
when you try to do infill,
sometimes people try to jack the prices up
'cause they know that it's got less risk.
And when you're approaching
a piece of land,
your goal is reducing the risks.
So 'cause sticks and bricks,
that's what the term we use for everything
that's above the footings.
The real variable in
real estate development
on the apartment side and house
and single-family housing,
the risk is not in what's
above the foundation.
It's what it's in the soil,
what surprises you're gonna get.
- Right.
- I remember checking out a site thinking
that it had sewer to it
because it was a manhole there
right on the property.
So it looked like everybody
would assume that.
- [Ryan] Right.
- You've seen the word assume broken down
and this totally smacked me with it.
When it got time for the civil
engineer to go out and check
that I already had the site under control.
I had the financing lined up
and we were literally
ready to start construction
when I found out that
the manhole was there.
But the sewer line was 200 feet away.
- Oh, man.
- This was 200 feet away
down a newly paved street
that the mayor didn't want me to cut up.
So I had to take it a circuitous route.
Ended up costing me $175,000 extra
because I didn't look at that manhole.
And sometimes the city doesn't know
or they'll tell you
something and you think,
"Well I can trust that."
I will say this city,
'cause I never quite forgiven him for it.
But this was in St. George, Utah.
I remember going to the
office, it was around noon
and everybody was at lunch
and some guy in a back-office
could see me at the counter
and he said, "Hey, can I help you?"
No, it's actually the guy
that's the head of public works
for the city of St. George's.
This is 20 years ago.
So I'm sure he's not there anymore.
But he asked me what I wanted
to do and he was going into,
he's getting out the maps and he says,
"Oh yeah, you've got sewer here.
"There's an eight-inch
line that runs right out
"the whole length of your property
"and it looks like you're good to go."
And I said, well,
can I get what's called
a Will Serve letter?
That means that as part
of the due diligence
a developer does, is you
wanna get documentation
that all the city services
are not only available to you
but that they have capacity
'cause sometimes there'll
be a sewer line there,
but it's already being used by everybody
that's upstream from you.
So, he gave me a letter saying, "Yeah,
"we've got an eight-inch
line, looks empty,
"there's nobody using it."
So great.
- Yeah, you're good to go.
- So we actually get as
far as pulling the permits
and our guys are out digging
on the site when we find out
that the sewer line
does go by our property,
but there's an intersection
a quarter of a mile away
and it stops there, a
mile and a half short
of the city's most active sewer line,
a mile and a half short.
- Oh my goodness.
- So I had 'em kept going
on the construction.
'Cause if you stop, I
mean, you don't wanna stop,
you don't wanna demobilize in any case
if you can avoid it.
But yeah, I had to go up and
down the street and I was,
what, 33 or 34 years old
probably at the time.
And I'm going up and down the street.
I'm getting in with the city,
I'm doing research in the County to see
who owns these tracks
of land along the way.
And within 60 days I got
everybody who owned land
that would benefit from that sewer line.
I got them signed on,
they contributed cash
to an escrow account.
The city signed off on drawings.
And so we actually built
this mile and a half long
sewer line to connect
it to the city services
while we were building
the apartment complex.
But it was almost by
luck that we found out
that it didn't connect.
- What would've happened
if you didn't find that?
- Right.
- Yeah.
- And I share these tales only
because partially I want to
cause a jolt of adrenaline
that will kick into somebody's,
heightened their awareness
to really be on guard
that you can even get a letter
from the head of the city
that will say something.
- And it's got to verify it.
- Right, or there's a
manhole on a property,
think we're all good and
you'll actually find out
