Condo Developers Buying Units in Project at Discount
Hey guys how does the process work with condo developers buying units in projects? I’ve seen developers like Zach Vella or Steve Ross get units in their buildings at discounts, a few questions.
1. At a small shop, say two partners how does one buy a unit at discount. If it’s a small project and the sponsor is taking one unit for himself, how do they buy it at a discount when that would look bad to investors on a PPSF.
2. Internally if it is one or two partners, how do they discuss it? In Zach Vellas case I read his partner signed off on him
buying a unit in project.
It seems with condo obviously fluctuates with the market but in initial UW do they account for some cheaper units that go to sponsors, is this directly outlined to investors up front (we want to hold 1-2 units for ourselves), seems to be its only if you’re somewhat wealthy/successful that they do it and hold the unit to live in or just sell for a big profit. Any other insight would be appreciated, more on the small condo dev side.
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