ᐅ Sell the entire property or opt for a partial sale with reinvestment?
Created on: 10 Jun 2018 13:41
K
kaho674
There is a large property in the family located in the center of Dresden. It is a residential area—surrounded by 6-story or even taller new apartment buildings. The land is currently occupied by a very old factory building. The owners do not have the funds to demolish this building and replace it with modern new construction. On the other hand, the ongoing costs and rental income are just about breaking even. If income continues to decline, the property could financially ruin the family.
So the question is what should happen with this "factory land." It is quite certain that it could be completely redeveloped since there are multi-family buildings all around. Adjacent to this land is the family’s own business property (including land), which is not intended to be sold as it is their livelihood.
The immediate idea was, of course, to sell the entire factory land. Its value is estimated at around 1-2 million (minus demolition costs), without going into details here. The money could be taken, divided among the family, and essentially spent without long-term benefit.
However, there are also grandchildren who are struggling to establish themselves in Dresden. The family would like to support them over the long term and believes that a rental property would be ideal. Coincidentally, the grandchildren are trained in property management and could help oversee the project.
So the idea came up to sell only part of the land to gain liquidity, demolish the old building, and construct a multi-family house—ideally in collaboration with an investor who would buy and develop the other half. Of course, everything would need to be carefully calculated to see if this is feasible and if the land will generate enough value.
Is something like this possible, or is it just a scam? What would you do?
So the question is what should happen with this "factory land." It is quite certain that it could be completely redeveloped since there are multi-family buildings all around. Adjacent to this land is the family’s own business property (including land), which is not intended to be sold as it is their livelihood.
The immediate idea was, of course, to sell the entire factory land. Its value is estimated at around 1-2 million (minus demolition costs), without going into details here. The money could be taken, divided among the family, and essentially spent without long-term benefit.
However, there are also grandchildren who are struggling to establish themselves in Dresden. The family would like to support them over the long term and believes that a rental property would be ideal. Coincidentally, the grandchildren are trained in property management and could help oversee the project.
So the idea came up to sell only part of the land to gain liquidity, demolish the old building, and construct a multi-family house—ideally in collaboration with an investor who would buy and develop the other half. Of course, everything would need to be carefully calculated to see if this is feasible and if the land will generate enough value.
Is something like this possible, or is it just a scam? What would you do?
Our existing building already exceeds a height of 14m (46 feet). Does that automatically place us in building class 5? Yes or no?
The building’s approximate external dimensions are 40m x 17m (131 feet x 56 feet). Currently, there is a staircase roughly in the middle of the building. If, for example, 6 apartments per floor were planned, would two staircases be required? (I'm not concerned here with whether this is practical, but strictly about the regulations.) The consultant said that two staircases are mandatory for escape routes. However, there is no connection between Staircase A and Staircase B, even in newly built buildings. Therefore, I don’t fully understand the reasoning behind this requirement. What does it depend on? Any ideas?
The building’s approximate external dimensions are 40m x 17m (131 feet x 56 feet). Currently, there is a staircase roughly in the middle of the building. If, for example, 6 apartments per floor were planned, would two staircases be required? (I'm not concerned here with whether this is practical, but strictly about the regulations.) The consultant said that two staircases are mandatory for escape routes. However, there is no connection between Staircase A and Staircase B, even in newly built buildings. Therefore, I don’t fully understand the reasoning behind this requirement. What does it depend on? Any ideas?
kaho674 schrieb:
Anyone has an idea? With two staircases, it basically comes down to 3 apartments per staircase, so that only counts as one building. Or is it because of the 35m rule? Whatever.
There must be some reason for studying architecture.
kaho674 schrieb:
The consultant said that two stairwells are mandatory because of escape routes. For a building measuring 40 x 17 m (131 x 56 feet), that might be correct. As far as I know, the maximum distance from the farthest corner of a room to the stairwell is 30 m (98 feet). In addition, there are requirements for stair width related to occupant load during evacuation: the people escaping should not bottleneck. However, this is an issue for much taller buildings.
kaho674 schrieb:
But there is no connection from stairwell A to stairwell B. Usually there is—on the floors served by both stairwells.
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N
nordanney7 Oct 2018 20:06kaho674 schrieb:
The building has approximate external dimensions of 40m x 17m (131 ft x 56 ft). Currently, there is a staircase roughly in the middle of the building. If you want to plan, for example, 6 apartments per floor, do you then need 2 staircases? (I’m not asking whether this can be reasonably arranged, but purely about the regulations.) The consultant said that 2 staircases are mandatory for escape routes. However, there is no connection between Staircase A and Staircase B. Even in newly built houses, that connection does not exist. That’s why the purpose of this regulation isn’t entirely clear to me. What does it depend on? Any ideas?There are different regulations depending on the federal state. This is also stated in the respective building codes (e.g., in your case § 33 and 35 of the Saxon Building Code). Ultimately, only your architect in consultation with the fire department can give you a definitive answer. For example, in building class 5, the walls of the staircases must also be constructed as fire walls. A second escape route might also be possible using firefighting equipment, depending on the building’s design. But as mentioned, you need local experts for that.
By the way, regarding the building height, an elevator should be installed to ensure rental suitability.
Thanks in advance for the information.
We would like to assess whether it makes sense to keep parts of the existing building. This would involve removing all ceilings, the staircase, and the roof. Essentially, only the external walls would remain. These are 60 to 65 cm (24 to 26 inches) thick, solid, and made of bricks. For the apartments, two stairwells including an elevator are planned, and possibly an additional floor. The consultant said it’s not worth it. He is probably somewhat right, as the rooms are unusually tall, among other things. For example, the ground floor has a ceiling height of 4.20 m (13 ft 9 in).
On the other hand, it might be possible to spread the work over several years and initially rent parts out as commercial space. This would allow the costs to be recorded as loss carryforwards against the current business operations.
Once the walls, including fire protection requirements, are completed, a change of use could be planned, with interior layouts renewed and exterior facilities adapted.
For completeness, the floor area ratio is 0.4 and the plot ratio is 1.2.
The consultant’s plan considered building 75 residential units on about 5,500 m² (59,200 sq ft). Unfortunately, I don’t have the exact square meter numbers here. He calculated it precisely.
He assumes a cost of €1,250 per m² (about $1,320 per sq ft). For 75 units × 100 m² (1,076 sq ft) × €1,250, that would be €9.375 million. Although this number seems unaffordable to us, I still think the €1,250 per m² estimate is a joke. Sure, with so many apartments there are some synergies, but that much? It makes me really skeptical.
We would like to assess whether it makes sense to keep parts of the existing building. This would involve removing all ceilings, the staircase, and the roof. Essentially, only the external walls would remain. These are 60 to 65 cm (24 to 26 inches) thick, solid, and made of bricks. For the apartments, two stairwells including an elevator are planned, and possibly an additional floor. The consultant said it’s not worth it. He is probably somewhat right, as the rooms are unusually tall, among other things. For example, the ground floor has a ceiling height of 4.20 m (13 ft 9 in).
On the other hand, it might be possible to spread the work over several years and initially rent parts out as commercial space. This would allow the costs to be recorded as loss carryforwards against the current business operations.
Once the walls, including fire protection requirements, are completed, a change of use could be planned, with interior layouts renewed and exterior facilities adapted.
For completeness, the floor area ratio is 0.4 and the plot ratio is 1.2.
The consultant’s plan considered building 75 residential units on about 5,500 m² (59,200 sq ft). Unfortunately, I don’t have the exact square meter numbers here. He calculated it precisely.
He assumes a cost of €1,250 per m² (about $1,320 per sq ft). For 75 units × 100 m² (1,076 sq ft) × €1,250, that would be €9.375 million. Although this number seems unaffordable to us, I still think the €1,250 per m² estimate is a joke. Sure, with so many apartments there are some synergies, but that much? It makes me really skeptical.
kaho674 schrieb:
The consultant's plan was to build 75 residential units on approximately 5500 m² (59,000 sq ft). Is it all independent living, purely residential without any commercial space in the building?
kaho674 schrieb:
Although the number seems unaffordable for us, Then it doesn't make sense if it is so far beyond the financial capacity of the family investors. Who is supposed to pay for this, or what is your role according to their concept?
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
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