A developer has purchased an enviable piece of land in an up-and-coming neighborhood and now they’ve filed their construction plans with the Department of Buildings. The next step would be to receive approval for the project in the form of a permit that allows construction to begin. But instead … radio silence. For a month, then two months, then six months, then a year, then three years. For a major New York City developer, a seemingly stalled project is big news and will be written about and discussed among industry veterans. Smaller, less established developers, however, have the advantage of anonymity and can coast for years with their delayed project out of the spotlight, crossing their fingers that they stumble upon the cash to finish their development. For a lender looking for projects to refinance or a developer looking for projects to purchase and complete, these projects represent an ideal opportunity. Finding them, however, is a task in itself.
TRData, The Real Deal’s comprehensive real estate database, has been tracking every project filed with the Department of Buildings since 2009. If the project includes at least 5,000 square feet or 5 residential units, we add it to our new development pipeline and keep an eye on it as it receives permits and approval.
Using our pipeline, we’ve singled our over a thousand projects of all asset types that we consider delayed. These are projects that have had no permit activity for at least two years. After two years of no permit action, it can be assumed these projects have hit a snag at some stage of development and should be prime candidates for refinancing or acquisition.