I just wanted to touch on a point that you should know and remember when doing your feasibilities for your developments.

The interest that you pay on the money that you borrow will be one of your biggest costs and it tends to be a cost that many people forget to counter in.

Even if you are doing a vendor finance deal or a joint venture there will almost always be an aspect of bank or lender finance or someone to whom you are paying interest.

That interest rate could be anywhere from 5-12% or even as high as 20% for some countries or if you are using mezzanine finance. So you need to make sure you don’t forget to calculate the interest component when doing your initial feasibility study.

If you are still using napkins or the backs of envelopes to work out the profits and feasibility – now is the time to graduate to using a more sophisticated method!
By using a feaso calculator you can ensure you are reminded to include all basic costs and that the math is right.

Those of you that have done my development course will have the feasibility software that I gave you in that. Otherwise you can purchase feaso software on the market anywhere from $500 to $50,000. But the $500 ones do the job!

Cheers,

Carly Crutchfield