Building brokers - share your experiences/thoughts?

[mugoftea]

My partner and I are planning to develop our block into a multi-dwelling site. This is our first development and we are considering the different options we have for approaching the development:

1. Going directly with a builder
2. Engaging the services of a building broker
3. Getting plans drawn up using an architect and then tendering out to builders ourselves.

We are leaning towards using a building broker, but would really like to hear about other people's experiences and thoughts around using a building broker.

As we understand it, they work closely with you during the design and DA phase, facilitate the tender to builders, but how much involvement do they have during build and construction?

Also, given they receive a percentage fee from the builder based on total construction cost, how independent are they really in selecting the best builder for their client?

Any thoughts/comments would be very much appreciated.

 

[mugoftea]

Bump - would really appreciate any thoughts on this?

 

[HD_ACE]

I am currently going through this atm.
leaning towards going through a broker. depends on the size and complexity of the development.

what size are we talking and what council?

cheers

 

[sanj]

Is this for a group (ie villa/townhouse) or multi (apartment) development?

 

[Colin Rice]

Also, given they receive a percentage fee from the builder based on total construction cost, how independent are they really in selecting the best builder for their client?

Would come down to the integrity of the individual building broker and also his/her personal experience, particularly in multi dwelling projects.

 

[mugoftea]

HD_ACE - The site is in City of Belmont, just over 900 sqm. What are your reasons for leaning towards using a broker for your development?

sanj - We are aiming for 7 or 8 apartments.

FMS - Yes, those are good points - some of which are difficult to gauge though which is why it is a difficult decision for us.

 

[Blacky]

In my opinion they just cost money.
Unlike in finance/loan broking the building is charged a fee by the building broker, which is then incorporated into the build cost. So while you may not see a fee from the broker it is included in the building price.

In my opinion you are probably better off speaking to a number of builders directly and working through quotes with individual ones.

A building broker could cost you an additional 60+k and I personally dont see them recovering that much with the services they provide.

Just my 2c

 

[Colin Rice]

FMS - Yes, those are good points - some of which are difficult to gauge though which is why it is a difficult decision for us.

Instinct and gut feeling usually work for me.

I know a couple if you are interested?

 

[mugoftea]

Thanks FMS, but we have already reached out to a few. They all seem knowledgeable & experienced - we're just deciding on whether we can do it ourselves without a broker.

 

[Colin Rice]

Thanks FMS, but we have already reached out to a few. They all seem knowledgeable & experienced - we're just deciding on whether we can do it ourselves without a broker.

Awesome, all the best.

 

[HD_ACE]

]HD_ACE - The site is in City of Belmont, just over 900 sqm. What are your reasons for leaning towards using a broker for your development?[/B]

sanj - We are aiming for 7 or 8 apartments.

FMS - Yes, those are good points - some of which are difficult to gauge though which is why it is a difficult decision for us.

For knowledge, guidence and time issues

What zoning is yours?

Cheers

 

[sanj]

For knowledge, guidence and time issues

What zoning is yours?

Cheers

Would building brokers have the commercial knowledge to make decisions as developers of apartments though? ultimately there are a lot of commercial decisions along the way you have to make

 

[HD_ACE]

Would building brokers have the commercial knowledge to make decisions as developers of apartments though? ultimately there are a lot of commercial decisions along the way you have to make

I think it would come down to the individual broker. One with experience and current projects in this area may qualify.

At the end of the day they can offer you options but are only as good as their expeiences and contacts. Its up to you to make the judgement call on if you will benefit from this.

Mds might take a bit more of expertise behind the wheel if your new to it though.

Cheers

 

[westminster]

My partner and I are planning to develop our block into a multi-dwelling site. This is our first development and we are considering the different options we have for approaching the development:

1. Going directly with a builder
2. Engaging the services of a building broker
3. Getting plans drawn up using an architect and then tendering out to builders ourselves.

We are leaning towards using a building broker, but would really like to hear about other people's experiences and thoughts around using a building broker.

As we understand it, they work closely with you during the design and DA phase, facilitate the tender to builders, but how much involvement do they have during build and construction?

Also, given they receive a percentage fee from the builder based on total construction cost, how independent are they really in selecting the best builder for their client?

Any thoughts/comments would be very much appreciated.

I thought I had replied on this but perhaps not.

With apartments the design part is super important. A good design will not only reduce your time in council, it can reduce your build costs.

I'm not sure where a building broker will fit in with that. I'd be hesitant to use the design service of a broker if they weren't experienced with apartments.

The one thing I don't like about brokers is that they have their list of builders and only those builders will be consulted. Potentially you could miss out on a really good builder. Of course you could miss out trying to find one yourself too.

If it is your first development then a apartment complex of that size is a very big project to bite off. You need to be very sure about the costs and risks, the commercial loan side, presales, headworks, good design, Design Codes, market requirements so you don't over or under capitalise etc etc