CalculateRealEstateROI

Strategy

Ground-Up Development

Building new product from raw land or teardown sites; highest risk, highest return spectrum.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Core concepts

Entitlement risk

Approvals can take 12–36 months.

Construction risk

Cost overruns and delays compound.

Examples

  • 20-unit infill apartment: 24 mo entitlement + 14 mo build → 22% IRR.

Practical applications

  • Experienced operators with capital partners.
  • Markets with strong absorption.

Common mistakes

  • Underestimating entitlement timeline.
  • Single-source GC dependency.