chapter024 - CHAPTER 24 DEVELOPMENT: THE DYNAMICS OF...

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CHAPTER 24 DEVELOPMENT: THE DYNAMICS OF CREATING VALUE Test Problems 1. The first step in the process of development is to: a. Establishing site control. 2. To gain control of a site, a developer may use: e. All of the above 3. Which of these stages of the development process comes first? a. Feasibility analysis, refinement, and testing 4. All of the following are valuable in facilitating the development permitting process except : d. Establishing the strength of your legal position early in the process. 5. A method of construction where the actual construction begins before the design is finished is known as: d. Fast-track. 6. In a land-development, the primary design professional is a : c. Land planner. 7. Soft costs include all except: e. Land improvement costs. 8. Which statement is incorrect concerning the typical construction loan? d. The loan extends a few years after a certificate of occupancy is issued. 9. The professional responsible for determining adequate specifications for building footings and foundation is a: d. Soils engineer. 10. When construction costs exceed the amount of the construction loan, a developer frequently will seek to cover the “gap” with: c. Mezzanine financing. Study Questions 1. Why is the permitting stage of development often the riskiest stage of the process? 24-1
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Solution: The process of obtaining permitting entails a commitment of significant time and cost. However, the ultimate outcome is uncertain as to whether the project will go forward. Public hearings, for example, are especially treacherous for developers because the local land use authorities may effectively kill a project. Furthermore, community opposition to the developer’s plans may result in costly
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chapter024 - CHAPTER 24 DEVELOPMENT: THE DYNAMICS OF...

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