A property development business plan is as much of a marketing document as it is a serious funding proposal. You must walk a careful line between these two styles of presentation because no investor wants to put money into a property deal where the developers cannot demonstrate marketing savvy,. At the same time, your presentation must give the image of strong professional abilities and reliable experience.
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The most important part of a business plan is the hook. It is what gets potential investors to want to read more. Your executive summary should supply such a hook. Finish your business plan and then write the executive summary, including the most important points of the plan in a concise, easy-to-read manner. The executive summary should be one to three pages long but not dense. If a person cannot skim it easily, noting the bullet points and important graphs, you lose your opportunity to hook interest.
Investors want to know how an investment in your project will benefit them. They want to feel how promising the project will be, but they get that feel from facts--demographics, land use studies, environmental impact reports, planning commission goals, local resident support and examples of past success with similar projects. Paint an overview of your project in the introduction, and include all the supporting facts that an investor wants to know plus plans and schematics. Do not hype the potential success of the project because hype is easy to detect and might lead the reader to a sceptical mindset.
The body of the business plan should include a detailed description of the project; any permits or agreements already in place; architects, contractors and suppliers; build-out; time line with benchmarks; marketing plan and target market strategy; and a brief user experience discussion that describes how an occupant of the project and local users will interact and derive benefit from the various amenities offered. Include attractive graphics that create an image as well as support your claims.
Fully discuss the uses of funds to be raised and report any money already invested and how it is being spent. Investors want to know if you are being realistic in your cost projections, and many real estate investors are savvy enough to know if your financial projections are correct. Check your projections with advisers who will give you trustworthy feedback. Investors also want to know what to expect from you in the form of investor reports, meetings and projected return on investment. Follow your discussion of the financials with spreadsheets showing your sales projections, income statement, balance sheet and cash flow statement.
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