Sell the property completely or partial sale with investment?

He assumes €1,250 per m². With 75 residential units x 100m² x €1,250, that would be €9.375 million. Although the figure seems unaffordable to us, I still consider the €1,250 a joke

From €5 million on, those are just numbers with a few zeros.

The question is what you would have to contribute to play with the big levers.

If the location is supposed to be that good, the sales price is significantly higher.

With 75 residential units x 100m² x €1,250, that would be €9.375 million. Although the figure seems unaffordable to us, I still consider the €1,250 a joke. Sure, with so many apartments there are some synergy effects, but that much? That makes me totally skeptical.

Do you have concrete, differing experiences from multi-family building, or are you comparing here the experience values with the single-family house business here in the forum?

The other question is what the €1,250 includes; I assume that construction site logistics, elevators, underground parking, basement, and incidental construction costs are not included, right?

He assumes €1,250 per m². With 75 residential units x 100m² x €1,250, that would be €9.375 million. Although the figure seems unaffordable to us, I still consider the €1,250 a joke. Sure, with so many apartments there are some synergy effects, but that much? That makes me very skeptical.

I definitely don’t see the €1,250 like that, the €9.4 million would be a bargain. I would start building immediately for that.

Quick calculation: New build rents are around €10 per sqm for you, so total rental income for the property approximately €900k. About 12% operating costs are deducted from that = €792k profit before taxes. Based on the €9.4 million, you could thus pay an annuity of 8.4%. Great investment for the existing property, it should also be no big problem to find a bank for that.
Loan-to-value somewhere at 14 to 15 times the rent, market value probably 25 to 28 times.

The only problem is that you cannot build for that price...

You confuse me.

No, I have no experience with m² prices in such a type of building. Of course, I initially base myself somewhere on the values one knows. I also did not expect the consultant to want to put up 75 apartments right away. I was rather thinking of around 30.

He has now planned completely normal apartments. He says he calculated "conservatively," whatever he means by that. In any case, in my opinion, it cannot have anything to do with the standard that most people here plan for themselves – and it doesn't have to.

Basically, we can only contribute the land. But the money is not wasted in a construction project – it is then there in the form of apartments, which hopefully do not immediately lose their value. I would not rate the location as outrageously great now, but also not as a decline. Normal residential development.

He has now initially planned completely normal apartments. He says he has calculated "conservatively," whatever he means by that. In any case, in my opinion, it can have nothing to do with the standard that most people here plan for themselves - but it doesn’t have to.

I wonder where he gets his experience from...

My developers always calculate significantly higher, at least €1,500 per sqm net for cost groups 200-500 (you have to pay gross since you are not entitled to input tax deduction for apartment rentals) plus ancillary construction costs (about 15% of the pure construction costs) plus house connections/outdoor facilities/parking spaces/construction period interest, etc.

Maybe you "save" a bit on the shell, since there is already an envelope standing. But it can't be much.

Ok, no. 1250 is purely just the apartments. All the other stuff, outdoor facilities, planning, etc. is not included. And these are completely new buildings. The demolition of the existing structures alone costs 600 million.

I still can't imagine that he can manage it for that money. On the other hand, I have zero clue compared to him. The man is Dr.

He has currently planned completely normal apartments. He says he has calculated "conservatively," whatever he means by that.

At first, I thought he had proposed to build exactly 75 apartments. But now I rather have the impression that he simply divided the building volume by an average apartment size including ancillary areas, resulting in about 75 units.

However: in my opinion, there is no local market that would simply absorb "75 pieces" of apartments like that. I neither see a homogeneous pure residential use demanded for a property of the outlined size, nor does it make sense for a property with more than six dozen apartments if they do not essentially differ except in size. There must also be a mix of normal and better income apartments, and, keyword "value added," for example assisted living or things like that.

In a "well-known" big city, you cannot just unimaginatively dump a few thousand square meters of apartments onto the market – there is no shortage of investors who focus purely on volume; and certainly not of interchangeable offerings. And even at city hall, no one finds it appealing when the hundredth copycat also wants to make a quick buck without ever asking about the local "wants."

Conversely, good real estate developers can also wallpaper over families that happen to have some large property holding. Even in medium-sized cities, you can set your watch by it: when some furniture store or clothing store closes, one month later the newspaper reports that the owner family now wants to develop a medical center (or a factory outlet center, or a mall) – and mind you, each time with the delusion that this is the very latest and that they are the first with such a groundbreaking idea.