WEBVTT 00:00:00.000 --> 00:00:01.879 Once our map recorded, the call started rolling 00:00:01.879 --> 00:00:06.700 in, and I'll tell you why. Yeah, that becomes 00:00:06.700 --> 00:00:09.220 public record and then people say, okay, let's 00:00:09.220 --> 00:00:11.980 go for that. Ever wonder what really happens 00:00:11.980 --> 00:00:14.560 behind the scenes in construction, real estate 00:00:14.560 --> 00:00:17.140 and development? We pull back the curtain on 00:00:17.140 --> 00:00:19.460 the new home construction industry, the real 00:00:19.460 --> 00:00:21.760 estate market and the trends shaping it all. 00:00:22.160 --> 00:00:24.879 Discover the stories, insights and expertise 00:00:24.879 --> 00:00:27.559 behind the process of building a new home. Join 00:00:27.559 --> 00:00:30.500 us for Trust the Process podcast and let's build 00:00:30.500 --> 00:00:35.079 something great together. The podcast where we 00:00:35.079 --> 00:00:37.740 talk about the new home industry, construction, 00:00:38.280 --> 00:00:41.700 real estate, and everything in between. Back 00:00:41.700 --> 00:00:45.799 today, this topic came up with us in real time. 00:00:45.920 --> 00:00:47.939 Actually, it's a situation that we were just 00:00:47.939 --> 00:00:49.520 recently faced with and thought it would be an 00:00:49.520 --> 00:00:51.340 interesting topic to share with you. And that 00:00:51.340 --> 00:00:54.460 would be tonnage builders and how they acquire 00:00:54.460 --> 00:00:56.659 land or how they find out where land is available. 00:00:57.000 --> 00:00:59.460 As a small builder, obviously we have to do a 00:00:59.460 --> 00:01:01.719 lot of due diligence to find these things and 00:01:01.719 --> 00:01:03.859 there are some short cuts that other builders 00:01:03.859 --> 00:01:05.859 are doing and so interesting that we've been 00:01:05.859 --> 00:01:08.099 approached. And so wanted to share that with 00:01:08.099 --> 00:01:10.019 you guys, thought it would be interesting. So 00:01:10.019 --> 00:01:12.019 Michael, I'm gonna let you take it away from 00:01:12.019 --> 00:01:14.099 here and kind of give us the backstory and a 00:01:14.099 --> 00:01:16.480 little bit of information on what you've experienced 00:01:16.480 --> 00:01:18.459 and what we've seen and kind of how they do it. 00:01:18.700 --> 00:01:20.819 Yeah, I mean, like you said, it happened in real 00:01:20.819 --> 00:01:23.480 time. And I want to clarify, when we say tonnage 00:01:23.480 --> 00:01:26.040 builders, we just mean a publicly traded builder 00:01:26.040 --> 00:01:28.760 that you've probably seen signs for in your town. 00:01:29.950 --> 00:01:32.409 builders are all over the country or at least 00:01:32.409 --> 00:01:35.049 build in half the states, right? And they're 00:01:35.049 --> 00:01:38.549 backed by Wall Street and bond money. And I mean, 00:01:38.750 --> 00:01:41.890 they have a lot of capital behind them and they 00:01:41.890 --> 00:01:44.909 live quarter to quarter. So they're not so concerned 00:01:44.909 --> 00:01:46.920 about. always how much they're going to make 00:01:46.920 --> 00:01:48.560 on each house. Many times they're concerned about 00:01:48.560 --> 00:01:50.579 how many rooftops they're going to add and how 00:01:50.579 --> 00:01:52.359 many homes are going to close out for the year 00:01:52.359 --> 00:01:54.099 because those are all things that drive their 00:01:54.099 --> 00:01:56.959 share price. So they live for their share price 00:01:56.959 --> 00:01:59.980 and we live more for our overall vision and of 00:01:59.980 --> 00:02:02.500 course we look at very carefully the margins 00:02:02.500 --> 00:02:04.340 on each individual house. Those are all very 00:02:04.340 --> 00:02:06.519 important when you're running a small home building 00:02:06.519 --> 00:02:08.819 firm. We don't have bond money. We have a limited 00:02:08.819 --> 00:02:12.039 amount of capital. that we have to be careful 00:02:12.039 --> 00:02:14.460 with, right? And we have to put our efforts into 00:02:14.460 --> 00:02:16.479 things that are going to be very lucrative for 00:02:16.479 --> 00:02:18.699 the company and satisfy our overall vision and 00:02:18.699 --> 00:02:20.979 are going to excite us and get us out of bed 00:02:20.979 --> 00:02:23.620 in the morning. So that being said, they don't 00:02:23.620 --> 00:02:26.819 have the same standards when it comes to profitability, 00:02:26.900 --> 00:02:29.719 when it comes to the desirability of the parcels. 00:02:30.039 --> 00:02:31.919 What they're looking for a lot of times is turnaround 00:02:31.919 --> 00:02:37.650 time, quantities, and basically footprint. We 00:02:37.650 --> 00:02:40.490 had a subdivision a year ago, the serene project 00:02:40.490 --> 00:02:42.810 that was approved a year ago, and since then 00:02:42.810 --> 00:02:45.150 we've been approached three different times by 00:02:45.150 --> 00:02:47.789 large tonnage builders or publicly traded builders. 00:02:48.349 --> 00:02:53.169 The last one, which was because we were the farthest 00:02:53.169 --> 00:02:56.169 along, we had all our utility laterals in and 00:02:56.169 --> 00:02:58.610 we looked ready to go. All the grading was done. 00:02:58.830 --> 00:03:00.650 Mind you, this is only six lots, but we had done 00:03:00.650 --> 00:03:02.889 a lot of work. To pull back the curtain, it was 00:03:02.889 --> 00:03:05.509 about a $700 ,000 worth of work. All the utility 00:03:05.509 --> 00:03:08.289 laterals, all the grading, everything. We had 00:03:08.289 --> 00:03:10.710 to demo a house that was there and remove the 00:03:10.710 --> 00:03:13.050 foundation. We had to abandon septic tanks because 00:03:13.050 --> 00:03:17.080 we densified this area. So we had done all that 00:03:17.080 --> 00:03:19.340 legwork. We had already had the map recorded 00:03:19.340 --> 00:03:21.879 once our map recorded and I'll touch on this 00:03:21.879 --> 00:03:24.060 later Once our map recorded the call started 00:03:24.060 --> 00:03:28.699 rolling in and I'll tell you why So that yeah 00:03:28.699 --> 00:03:30.819 that becomes public record and then people say 00:03:30.819 --> 00:03:33.539 okay, let's let's go for that So what brought 00:03:33.539 --> 00:03:35.840 this to my attention and brought it up in conversation 00:03:35.840 --> 00:03:40.460 with you was that our last offer was As much 00:03:40.460 --> 00:03:43.020 margin what we would have made on selling the 00:03:43.020 --> 00:03:46.759 six lots to this other builder is only about 00:03:46.759 --> 00:03:49.500 20 % short of what we plan on making for the 00:03:49.500 --> 00:03:54.400 entire project. So land plus improvements sold 00:03:54.400 --> 00:03:58.039 to this ex -builder would have been almost as 00:03:58.039 --> 00:04:01.099 profitable as land plus improvements plus the 00:04:01.099 --> 00:04:03.520 houses plus selling the houses plus the margin 00:04:03.520 --> 00:04:05.879 on the houses. Now, could I be underestimating 00:04:05.879 --> 00:04:07.759 what we'll make on the entire project if we build 00:04:07.759 --> 00:04:11.719 it out? possibly. I tend to go more conservative. 00:04:11.939 --> 00:04:15.240 I adjust for a 10 % market correction. I adjust 00:04:15.240 --> 00:04:18.860 for 10 % increase in cost of construction. So 00:04:18.860 --> 00:04:20.899 there's kind of about a 20 % delta. So that could 00:04:20.899 --> 00:04:22.560 explain some of it. But there's a good chance 00:04:22.560 --> 00:04:24.740 that cost of construction ends up 5 % higher. 00:04:24.860 --> 00:04:27.420 Market comes down 5%. So it's probably not going 00:04:27.420 --> 00:04:30.920 to go from 20 % fluff to zero, it's probably 00:04:30.920 --> 00:04:34.040 going to go from 20 % fluff to like 10, 12 % 00:04:34.040 --> 00:04:35.339 fluff. So there's always going to be something 00:04:35.339 --> 00:04:38.259 that was off, some sort of surprise and contingency 00:04:38.259 --> 00:04:41.720 in there. So that being said, we have a lot of, 00:04:41.720 --> 00:04:43.720 a lot of fluff built in, but when you're seeing 00:04:43.720 --> 00:04:46.139 another builder coming in and saying, wow, how 00:04:46.139 --> 00:04:48.720 are they going to make any money doing this, 00:04:48.839 --> 00:04:50.680 giving us this kind of margin on these lots, 00:04:50.740 --> 00:04:53.620 almost they were offering us, uh, yeah, almost 00:04:53.620 --> 00:04:57.300 a half a million dollars per lot with, uh, well 00:04:57.300 --> 00:05:01.730 for them. How is that a thing that fits? A couple 00:05:01.730 --> 00:05:05.410 of things. I racked my brain on this. I could 00:05:05.410 --> 00:05:07.250 build a hundred houses a year if I could spend 00:05:07.250 --> 00:05:10.069 that kind of money on lots. But I think what 00:05:10.069 --> 00:05:12.170 it is is that they do a lot of their repeating 00:05:12.170 --> 00:05:15.970 plans. They get a lot of volume discounts. They 00:05:15.970 --> 00:05:17.829 know exactly what those plans are going to cost. 00:05:18.769 --> 00:05:21.189 I've essentially removed all the unknowns for 00:05:21.189 --> 00:05:24.410 them because I've done all the laterals. I've 00:05:24.410 --> 00:05:26.230 done all the approvals. I've done city council. 00:05:26.350 --> 00:05:28.319 I've done everything. And I think that's what 00:05:28.319 --> 00:05:30.800 it is, is that I've removed so many unknowns. 00:05:31.279 --> 00:05:33.779 The vertical cost of construction for them is 00:05:33.779 --> 00:05:37.120 basically, you know, there's no unknowns in that 00:05:37.120 --> 00:05:39.199 as well because they built this, they're going 00:05:39.199 --> 00:05:41.060 to build two models and they built each of those 00:05:41.060 --> 00:05:45.319 models 500 times over the last five years. So 00:05:45.319 --> 00:05:47.560 I think that that's a big part of it. And then 00:05:47.560 --> 00:05:50.720 I think that comes back to just really their 00:05:50.720 --> 00:05:53.100 footprint and their numbers. Let's say they already 00:05:53.100 --> 00:05:55.589 have that serene for instance, is a low density, 00:05:55.949 --> 00:06:00.050 low slung product. This particular builder has 00:06:00.050 --> 00:06:03.990 a lot of that exposure or has a lot of that in 00:06:03.990 --> 00:06:06.230 their repertoire. And that's kind of one of their 00:06:06.230 --> 00:06:08.529 big product offerings. So if they could have 00:06:08.529 --> 00:06:10.490 an existing model three miles away and say, oh, 00:06:10.490 --> 00:06:12.610 by the way, we're not going to model over there, 00:06:12.649 --> 00:06:14.209 but you can use this model and we're going to 00:06:14.209 --> 00:06:16.709 take, you know, this is going to be part of it. 00:06:16.750 --> 00:06:19.000 We're going to annex it to this other. subdivision 00:06:19.000 --> 00:06:20.600 from a marketing standpoint, not from a legal 00:06:20.600 --> 00:06:22.319 standpoint, but we're going to market against 00:06:22.319 --> 00:06:25.279 this. It has no HOA and yeah, we can pay almost 00:06:25.279 --> 00:06:26.819 a half a million dollars because we're building 00:06:26.819 --> 00:06:29.399 at $80 a square foot and we can sell them for 00:06:29.399 --> 00:06:32.180 $400 a square foot, let's pretend. So they can 00:06:32.180 --> 00:06:34.939 basically give me that margin because they wanted 00:06:34.939 --> 00:06:37.420 the land. Now I didn't accept that offer for 00:06:37.420 --> 00:06:40.240 many reasons. Number one, we were way too invested 00:06:40.240 --> 00:06:42.220 in this project. Number two, I'm not in the business 00:06:42.220 --> 00:06:44.000 of land improvement. I'm in the business of building 00:06:44.000 --> 00:06:47.060 houses and I just couldn't, it didn't feel right. 00:06:47.160 --> 00:06:49.370 I want to see it. through. And we already had 00:06:49.370 --> 00:06:51.129 the homes designed. We've already got the marketing 00:06:51.129 --> 00:06:53.370 collateral. There was no way in hell I was going 00:06:53.370 --> 00:06:57.069 to let the almighty dollar win out all that work. 00:06:57.170 --> 00:06:59.170 And I just I'm far too passionate about this 00:06:59.170 --> 00:07:02.910 business to take an offer like that that would 00:07:02.910 --> 00:07:05.850 have been financially very lucrative and would 00:07:05.850 --> 00:07:07.589 have been a lot less stress because we would 00:07:07.589 --> 00:07:09.490 have been out of this project six weeks ago. 00:07:09.730 --> 00:07:10.730 It would have been done. We would have had our 00:07:10.730 --> 00:07:12.750 money. And that would have been it. I would have 00:07:12.750 --> 00:07:16.970 had to watch. It is easy to imagine. how some 00:07:16.970 --> 00:07:20.170 builders could get caught up in that and, you 00:07:20.170 --> 00:07:22.089 know, kind of get gobbled up by the big guys 00:07:22.089 --> 00:07:24.329 because there could be a business model in that 00:07:24.329 --> 00:07:26.009 if you weren't passionate or if you weren't committed 00:07:26.009 --> 00:07:29.189 to seeing it through. And some people don't even 00:07:29.189 --> 00:07:31.110 know what they would put there anyway. All they 00:07:31.110 --> 00:07:32.769 are looking at it as maybe they're passionate 00:07:32.769 --> 00:07:36.129 about taking gross land and making it look buildable. 00:07:36.310 --> 00:07:38.490 That mean people, you know, if that were your 00:07:38.490 --> 00:07:40.769 passion, you could have a full business in that, 00:07:40.850 --> 00:07:43.970 assuming you have the capital to do it because 00:07:43.970 --> 00:07:46.139 there's a lot of demand there. In fact, a good 00:07:46.139 --> 00:07:48.459 friend of mine, who we bought one of our other 00:07:48.459 --> 00:07:50.500 subdivisions, he doesn't normally get them as 00:07:50.500 --> 00:07:53.720 far as we got serene, but he had one teed up 00:07:53.720 --> 00:07:55.800 with a notice of final action from city council. 00:07:56.490 --> 00:07:58.930 Shopped it to me and we took it and that is our 00:07:58.930 --> 00:08:01.410 Westridge product. Um, I had to do everything 00:08:01.410 --> 00:08:03.170 else. We still have to get the utility plan, 00:08:03.290 --> 00:08:04.709 the civil improvement plans before they'll record 00:08:04.709 --> 00:08:07.250 that map. So that notice of final action expires 00:08:07.250 --> 00:08:09.930 in 2027 and I bought that Westridge product in 00:08:09.930 --> 00:08:12.350 May of this year. So he had about two years left. 00:08:12.350 --> 00:08:14.189 He was kind of saying, I either need to record 00:08:14.189 --> 00:08:16.529 the map or sell it to a developer who has enough 00:08:16.529 --> 00:08:18.750 time to record that map because city council 00:08:18.750 --> 00:08:20.589 actions are going to expire in two years. So 00:08:20.589 --> 00:08:22.629 we couldn't just sit on that. We got to at least 00:08:22.629 --> 00:08:24.290 get the map recorded, which we're doing. We'll 00:08:24.290 --> 00:08:25.750 probably have that map recorded in three months. 00:08:25.639 --> 00:08:29.439 cell. And we've been roached. We've been approached 00:08:29.439 --> 00:08:31.480 by one of those big builders, again, even on 00:08:31.480 --> 00:08:36.700 that parcel. Right, and it's nothing I'm interested 00:08:36.700 --> 00:08:38.399 in moving. I'm far too passionate about that 00:08:38.399 --> 00:08:41.240 one, especially. And then our Argos project that 00:08:41.240 --> 00:08:44.279 we took out of the City Master Plan, and we took 00:08:44.279 --> 00:08:47.919 out of public zoning and into... We haven't mentioned 00:08:47.919 --> 00:08:50.399 that one here yet, so that one will be new for 00:08:50.399 --> 00:08:54.769 our audience. Maybe launching fall 26, sales 00:08:54.769 --> 00:08:59.690 in 27. That project, as soon as the city council 00:08:59.690 --> 00:09:02.190 did their notice of final action, that is public 00:09:02.190 --> 00:09:05.070 record. And there are builders and land brokers 00:09:05.070 --> 00:09:08.529 who just troll the notice of final actions on 00:09:08.529 --> 00:09:10.850 the monthly city council meetings and say, oh, 00:09:10.909 --> 00:09:12.750 this parcel got approved, this parcel got approved, 00:09:12.789 --> 00:09:14.710 this parcel. Okay, I'm going to go approach these 00:09:14.710 --> 00:09:16.750 guys. And I've gotten called, one guy called 00:09:16.750 --> 00:09:19.850 me. I'm not kidding. Would say probably 11 times 00:09:19.850 --> 00:09:21.649 just checking in on you. Do you still want to 00:09:21.649 --> 00:09:23.750 develop it? And by the way, I mean, it's gonna 00:09:23.750 --> 00:09:25.429 be hard for you to develop that I've never heard 00:09:25.429 --> 00:09:27.889 of your company, you know, okay, that's my I 00:09:27.889 --> 00:09:29.570 mean a lot of people haven't heard of my company, 00:09:29.590 --> 00:09:34.210 but I have But and I'm developing it. I know 00:09:34.210 --> 00:09:36.850 what I'm capable of. I'm not afraid of it So 00:09:36.850 --> 00:09:39.110 I think that they use a lot of that they think 00:09:39.110 --> 00:09:42.269 oh, maybe this is just a landowner. I used you 00:09:42.269 --> 00:09:44.309 know, what anecdote with you yesterday is that 00:09:44.649 --> 00:09:46.629 They're looking for land that has a pulse to 00:09:46.629 --> 00:09:48.450 it because there's a lot of blank land out here, 00:09:48.490 --> 00:09:51.320 but they're looking for land that... Oh, something's 00:09:51.320 --> 00:09:54.340 stirring over there. They've got a plat map in 00:09:54.340 --> 00:09:56.399 mind. They've got something designed. They're 00:09:56.399 --> 00:09:59.299 doing something. Let's figure out what this is. 00:09:59.679 --> 00:10:01.840 And if you're a land broker, for instance, you 00:10:01.840 --> 00:10:04.000 don't really care what it is because you probably 00:10:04.000 --> 00:10:07.139 have a repertoire of buyers that you might call 00:10:07.139 --> 00:10:09.659 terribles and say, oh, it was rezoned for commercial 00:10:09.659 --> 00:10:13.659 or C2 activity, outdoor activity, things like 00:10:13.659 --> 00:10:16.559 that. And I can shop this to drive -through pads 00:10:16.559 --> 00:10:19.350 and gas station pads and things like that. It's 00:10:19.350 --> 00:10:21.289 a big parcel, maybe I can shop it to a big anchor 00:10:21.289 --> 00:10:24.289 tenant and do the accessory structure. So there's 00:10:24.289 --> 00:10:27.590 a lot of that. It doesn't always represent demand 00:10:27.590 --> 00:10:31.029 because some of the calls were brokers that were 00:10:31.029 --> 00:10:35.009 looking to bring me and an end user together, 00:10:35.169 --> 00:10:36.809 even on the residential. Now on the residential, 00:10:36.970 --> 00:10:38.990 they're shopping against big builders or some 00:10:38.990 --> 00:10:41.370 other local builder like myself who builds luxury 00:10:41.370 --> 00:10:43.309 homes and just says, you know what, find me parcels 00:10:43.309 --> 00:10:45.250 that are ready because I'm ready to go now. But 00:10:45.250 --> 00:10:48.080 I found it interesting and it's... It's been 00:10:48.080 --> 00:10:49.960 eye -opening because if I ever did get burned 00:10:49.960 --> 00:10:51.700 out from developing and I wanted something that 00:10:51.700 --> 00:10:55.299 had basically zero liability, there's no recourse. 00:10:55.460 --> 00:10:57.039 I mean, you bought the land, here's the map, 00:10:57.600 --> 00:10:59.679 that's on you. I don't care about if your refrigerator 00:10:59.679 --> 00:11:01.799 dies in a year or you've got a leak in your bathtub. 00:11:02.480 --> 00:11:04.139 The things that we have to deal with and from 00:11:04.139 --> 00:11:05.860 a warranty standpoint, there's no warranties 00:11:05.860 --> 00:11:08.480 and it is lucrative. I mean, I don't think every 00:11:08.480 --> 00:11:12.590 deal would be a serene home run, but... I mean, 00:11:12.730 --> 00:11:15.929 it's a lot. It's a big business, and there's 00:11:15.929 --> 00:11:18.389 a lot of margin there. Like I mentioned, my friend 00:11:18.389 --> 00:11:24.389 Mark, who just trolls landowners. He's at step 00:11:24.389 --> 00:11:26.730 one, where he's just hunting out landowners, 00:11:26.789 --> 00:11:28.289 and he's been in this town for 30 years, so he 00:11:28.289 --> 00:11:30.590 knows a lot of landowners. And they're ready 00:11:30.590 --> 00:11:33.750 to go. Our Westridge project was that way. They 00:11:33.750 --> 00:11:36.129 call them, I have two acres. I want to get rid 00:11:36.129 --> 00:11:38.490 of it. He said, wait before we sell it, let's 00:11:38.490 --> 00:11:41.149 get a map drawn. Let's get notice of final action. 00:11:41.620 --> 00:11:43.539 uh the six month period that we went through 00:11:43.539 --> 00:11:46.440 on Argos let's do that six month period and probably 00:11:46.440 --> 00:11:48.820 double your land value because I wouldn't have 00:11:48.820 --> 00:11:51.059 paid what I paid for that land if I didn't have 00:11:51.059 --> 00:11:53.179 a notice of final action because I would have 00:11:53.179 --> 00:11:55.039 never believed that they would have let they 00:11:55.039 --> 00:11:57.870 would let us do what we're doing now Um, and 00:11:57.870 --> 00:12:00.210 it's something crazy, but it's a small enclave. 00:12:01.049 --> 00:12:03.289 It's 6 ,000 square foot lots. They usually like 00:12:03.289 --> 00:12:06.309 to see larger half acre lots. It wasn't, uh, 00:12:06.409 --> 00:12:08.830 it wasn't a no brainer for the city to approve 00:12:08.830 --> 00:12:11.190 that. So the fact that he approved it and not 00:12:11.190 --> 00:12:12.950 only saved me six months, but it saved me a hell 00:12:12.950 --> 00:12:14.850 of a lot of unknowns. And then they did another 00:12:14.850 --> 00:12:17.330 little thing, which was give me five months to 00:12:17.330 --> 00:12:19.889 basically have it under contract and work on 00:12:19.889 --> 00:12:22.759 the utility plan, the grading plan. basically 00:12:22.759 --> 00:12:25.019 all of the civil improvements that I didn't own 00:12:25.019 --> 00:12:27.120 the land yet. All I had was a non -refundable 00:12:27.120 --> 00:12:29.879 deposit out. It was as good as mine, but I didn't 00:12:29.879 --> 00:12:32.679 have to spend $600 ,000 on the land yet. And 00:12:32.679 --> 00:12:34.799 I didn't have to do that until May. So I worked 00:12:34.799 --> 00:12:38.120 on it for five months until then and closed in 00:12:38.120 --> 00:12:40.100 May. And then now we're in October. We still 00:12:40.100 --> 00:12:41.960 don't have a final map recorded. And they did 00:12:41.960 --> 00:12:44.720 a lot of legwork for me. So it really shows you 00:12:44.720 --> 00:12:48.360 the downstream, the upstream way that looks like 00:12:48.360 --> 00:12:50.850 to develop. to go. They worked on it for six 00:12:50.850 --> 00:12:53.970 months. I took the baton in January. It's now 00:12:53.970 --> 00:12:56.649 October and we're not even going to have a final 00:12:56.649 --> 00:12:58.570 map recorded maybe till January or February, 00:12:58.690 --> 00:13:02.490 could potentially be later. So it really is astounding 00:13:02.490 --> 00:13:04.870 when to think it is about an 18 month process 00:13:04.870 --> 00:13:08.590 to get this going. So that being said, you can 00:13:08.590 --> 00:13:11.409 see why the farther down the road you are, the 00:13:11.409 --> 00:13:14.590 more valuable your parcel is. Mm hmm. More valuable 00:13:14.590 --> 00:13:18.360 it is. And the the more opportunities to bail 00:13:18.360 --> 00:13:20.539 on it. Right. So it's kind of a catch because 00:13:20.539 --> 00:13:22.720 you got more invested. Now you have a love for 00:13:22.720 --> 00:13:25.860 it. You're more in it, but the opportunities 00:13:25.860 --> 00:13:30.879 are greater. So exactly. Right. Right. And it's 00:13:30.879 --> 00:13:33.399 really comforting in a way, as long as that demand, 00:13:33.559 --> 00:13:36.360 backstop demand stays there that up until the 00:13:36.360 --> 00:13:38.659 11th hour, you can probably bail on it and make 00:13:38.659 --> 00:13:41.600 money. So it is, you know, it is encouraging 00:13:41.600 --> 00:13:45.539 and it is kind of a, um, It's a good and a bad 00:13:45.539 --> 00:13:47.220 thing because it's double -edged sword because 00:13:47.220 --> 00:13:50.600 it encourages you to take on more development 00:13:50.600 --> 00:13:53.019 projects. You're saying, oh, worst -case scenario, 00:13:53.240 --> 00:13:55.399 I can sell it once the note of final action is 00:13:55.399 --> 00:13:57.019 approved. I can sell it once my utility plan 00:13:57.019 --> 00:13:59.419 is approved. I can sell it once my parcel map 00:13:59.419 --> 00:14:01.440 is recorded. I have all these off -ramps that 00:14:01.440 --> 00:14:03.740 I can get rid of it if I decide not to see the 00:14:03.740 --> 00:14:06.789 whole project or if something changes. When I 00:14:06.789 --> 00:14:08.730 get over my skis somewhere else, I could kind 00:14:08.730 --> 00:14:11.570 of bail on a project. Just proves that each one 00:14:11.570 --> 00:14:14.070 is really a labor of love. And some of the times 00:14:14.070 --> 00:14:16.929 you get and buy it and you're ready there, you 00:14:16.929 --> 00:14:18.769 know, people don't always know how much emotion 00:14:18.769 --> 00:14:21.250 has gone into that or how, you know, how much 00:14:21.250 --> 00:14:23.289 you have learned to love that project because 00:14:23.289 --> 00:14:25.490 you could have bailed on it and you didn't. Yeah, 00:14:25.490 --> 00:14:28.049 exactly. By the time you're going vertical, you've 00:14:28.049 --> 00:14:30.330 passed on several off -ramps. No, I don't want 00:14:30.330 --> 00:14:31.490 to do that. I don't want to do that one. I don't 00:14:31.490 --> 00:14:33.190 want that one. I want to see it through. It was 00:14:33.190 --> 00:14:35.870 good. Yeah, and it interesting to get something 00:14:35.870 --> 00:14:39.049 that somebody might not wouldn't typically know 00:14:39.049 --> 00:14:41.309 about it It's certainly something that five years 00:14:41.309 --> 00:14:42.950 ago. I didn't even know I didn't realize that 00:14:42.950 --> 00:14:45.370 there was that much demand at every single stage 00:14:45.370 --> 00:14:48.590 I figured that it was either raw land or completely 00:14:48.590 --> 00:14:50.350 done already and that was the only place where 00:14:50.350 --> 00:14:52.169 there was demand But I didn't realize all along 00:14:52.169 --> 00:14:55.690 that stream. There's a lot of demand Interesting. 00:14:55.909 --> 00:15:00.220 Yeah. Well now, you know now you guys know so 00:15:00.220 --> 00:15:02.679 thanks for joining us for another episode and 00:15:02.679 --> 00:15:07.320 we will see you next time thanks bye bye thanks 00:15:07.320 --> 00:15:09.620 for tuning into the trust the process podcast 00:15:09.620 --> 00:15:12.279 make sure to follow us on spotify to stay in 00:15:12.279 --> 00:15:14.820 the loop with the latest insights project updates 00:15:14.820 --> 00:15:17.480 and everything in between see you next time