Real Estate Entitlement & Development: Overview
The acquisition and development of real estate is a complex and legally intensive process. Neek Law Firm provides the proper support and expertise that make the process a smooth and profitable one, and more often than not, save developers and owners from frustrating and potentially expensive complications in the development process.
In California, there are specific regulations regarding land-use at the state, county, and city level. These regulations vary substantially from region to region, and more often than not the terms of individual projects will need to be negotiated with a local government agency. Each city has a general plan laying out its own regulations, and may have subsequent plans limiting certain property metrics such as height, lot size, setbacks, and landscaping. Each property must be entitled and zoned for its specific use, which can take several years without adequate legal representation.
Our expertise helps clients to alleviate the headaches caused by the multitude of governmental approvals needed in the real estate development process, and will help maximize protections for clients throughout and after completion of each project. Our familiarity and strong relationships with regulators allows Neek Law Firm to expedite land-use matters, making the legal process as painless and affordable as possible. As a result, our clients can spend more time focusing on what matters most to them.
Within our Real Estate Development Group, Neek Law Firm provides legal expertise in the following practice areas:
- Property Entitlement
- Complex zoning matters
- Subdividing properties
- Property Line Adjustments
- Easements and encroachments
Development Joint Ventures with Neek Law Firm:
In addition to providing all of the legal services necessary to carry out a successful development project, we at Neek Law Firm offer select owners the unique opportunity to partner directly with our firm on development projects, and in doing so avoid traditional hourly legal fees. Instead of being charged hourly, these joint venture partners (generally property owners) function more as participants to an investment than as third parties paying for legal work. In exchange for percentage ownership interest in the underlying property, Neek Law Firm will carry out all necessary entitlement and legal matters. Re-entitlement alone can add substantial value to a property, increasing the value of the property owner’s land before having done any actual physical improvements. Moreover, due to our strong ties to a wide variety of real estate investors and developers, we have the ability to bring in additional partners that can truly help to add value to a property once redevelopment begins.
In general, these development joint ventures take place as follows:
First, an owner or investor approaches Neek Law Firm with a potential development project, or, via our proprietary property identification process or relationships with various brokers, we at Neek Law Firm locate a property that we believe is currently underutilized. For example, a piece of land may currently be occupied by an industrial building and our development/real-estate experts conclude that the property could be better used for a four-story apartment building or a five-story mixed-use project.
After identifying potential development or re-development projects, Neek Law Firm reaches out to our network of investors and brokers, carefully selecting the right investment team for a given project. We then form the development joint venture between those investors, the property owner, and the Neek Law Firm.
Once the joint venture is official, Neek Law Firm begins the complex re-entitlement process. It is important to note that along the way, all aspects of necessary legal work, including the formation of the holding company, operating agreements, construction agreements, funding agreements, and joint-venture or development agreements, are all handled by Neek Law Firm as part of the investment venture. In the example above, the land was entitled for a single story industrial property, and until the proper governmental approvals have been made, no other type of structure can be developed on that property. However, after new entitlement has been obtained, the value of the underlying property instantly increases substantially. At this point, depending on the specific circumstances and the desires of the property owner and/or managers, we may move forward with the sale of the existing property with the added value of new entitlements, or may proceed with development and subsequent leasing of the property.
In offering the development joint venture, we at Neek Law Firm provide partners with the opportunity to add significant value to their property, and do so without incurring significant out-of-pocket expenses. Instead of having the complexities involved with finding investors, developers, and a competent legal team, property owners (as well as developers and investors) can engage Neek Law Firm to handle the entire process. This not only makes the process easier and more professional, it actually encourages owners to participate in projects that they otherwise would not have. In sum, by bringing together the relevant parties and conducting the complex legal work involved, we at Neek Law Firm can help add substantial value to development projects while making the the process more smooth for everyone involved.
The legal entitlement process can be very complex, and when executed properly, can add substantial value to a real estate project. On top of having to comply with generalized state and local regulations, each property proposal is heavily scrutinized at the municipal level. At Neek Law Firm, our expertise in land-use law can help to make the process as smooth and cost-effective as possible. For this reason, we strongly encourage clients to engage Neek Law Form from the very beginning of the process.
What is Entitlement?
A land entitlement is a legal right created by agreement with a local regulatory body. It dictates how a given piece of property may or may not be used. In addition to the obvious requirement to comply with the government, entitlement serves another important function: it has a profound effect on the value of the underlying land being entitled. Ensuring that land is both adequately entitled for its intended use as well as broadly entitled for multiple uses can increase property values substantially.
Importance of Hiring the Right Legal Team
Due to the nature of the process, personal experience and relationships are absolutely key to receiving an entitlement in a timely and affordable manner. Each municipality has different rules and regulations, and perhaps more importantly, different individuals sitting on review boards. It is the combination of the Neek Law Firm’s legal expertise and familiarity with the process (and regulators) that allows our firm to handle entitlement matters in a cost-effective yet tailored manner. We believe that we can offer the best ways for a client to protect property interests and maximize land or investment values.
Zoning is the process by which local governments determine the acceptable uses for given pieces of property. General zoning ordinances may be issued for specific property types or regions; for example, one part of a city may allow for commercial and industrial developments, while another allows only for residential developments, and a third may allow for mixed-use.
Though each zoning matter is highly specific to the client and property, generally, zoning issues will fall into one of the following categories:
A property is non-conforming when a new zoning ordinance comes into effect and the property no longer meets the local zoning requirements. This may occur when either the current property type or current property use is disallowed by the new ordinance. Generally, an owner may continue to use the land in the same manner as before without going through rezoning. However, if the owner subsequently wants to sell the property or change its use, zoning issues may become complicated and have a negative impact on the transaction. Neek Law Firm can help to resolve “non-conforming” zoning issues to make the rezoning process as pain-free as possible, whether it be due to a sale, change of use, or otherwise.
A zoning ordinance may allow for a specific property type in a given region, so long as certain conditions are met in relation to that property (such as a required number of parking spots, certain landscaping, offering some sort of environmental improvement to the area, etc.) When such a condition exists, we file a conditional use application with the relevant government body in order to certify the condition(s) is met, and subsequently help combat any issues if the condition is not met.
Also known as a “special use permit,” a variance is required when there is some specific and adequate reason why the current zoning ordinance should not be applied to a given property. Generally, a special use permit will be granted where the only alternative is to leave the land unused. Thus, for particularly small or strangely shaped lots, zoning ordinances may be lifted or altered so that a viable structure can be built. Other instances requiring variances also exist, though the less a party truly needs the variance, the more difficult the approval process. Neek Law Firm can assist in preparing an application for a variance, taking special care to meet the client’s specific goals. We then represent the client throughout the review process to maximize the application’s likelihood of being approved as intended.
Subdividing land or doing a “lot split,” entails taking a singular piece of property and dividing it up in order to increase the total value of that property. When a single lot is divided up to as many as four “new” lots, it is referred to as a “lot split.” This will often occur where a large residential property is split in half and two homes are constructed, thereby increasing the overall value of the land. When a single property is divided into more than four “new” properties, it is referred to as a “subdivision.” This may occur where the use of a piece of land is being changed to a new use; for example, land that was once used for a single car dealership may be “subdivided” into several pieces of property, each with its own home on it.
The importance of having an experienced attorney when attempting to divide a piece of property cannot be understated. At Neek Law Firm, we provide the quality of service required to complete a lot split or subdivision request efficiently and effectively, and will vigorously combat any oppositions to the application. Or, if a neighboring property owner attempts a lot split or subdivision to the detriment of a client’s property interests, our land use specialists have the experience required to combat such application.
Property Line Adjustments
Property line adjustments involve altering the property lines on already existing parcels of land. A line adjustment may be required when attempting to combine neighboring parcels into one property, known as “lot consolidation.” It may also occur where an owner desires to change the shape of a property, or simply because two neighboring properties have a dispute over exactly where the property lines lie.
Regardless of form, it is essential to consult an experienced attorney that can help navigate through the various approval and compliance requirements associated with property line adjustment. Property lines can have drastic effects on an owner’s property rights, including affecting easements/encroachments and even the future sale of the property. Neek Law Firm offers our clients the type of know-how and determination required to achieve best possible results in property line adjustments, and to do so in an efficient, cost-effective manner.
Easements and Encroachments
An easement is a legal “right of way;” in another’s land; it gives one party the legal right to use part or all of another party’s land, generally for a specific purpose. Easements can have a significant impact on the value of a property. If, for example, a neighbor successfully makes a claim of an easement on one’s property—such as the right to use a path crossing the property in order to access the lake behind the owner’s house—that easement carries forward with the land, even after the property is sold. Thus, in the event of a sale, the owner will be forced to sell land that a third party has a right to use. This could potentially decrease or increase the value of any property substantially. At Neek Law Firm, we provide services for drafting easements, assisting in obtaining easements, or simply reviewing existing easements in order to determine their validity and scope.
Encroachments, on the other hand, involve the unlawful use of another’s property by way of constructing a building, wall, driveway, or other structure without permission. Generally speaking, a property owner can recover monetary damages for any decrease in property value due to the existence of an encroachment. However, unless the proper steps are taken in a timely fashion, a court may find that the encroaching party has been allowed to rely on the encroachment for an extended period of time and will thus allow it to stay—functionally converting the encroachment to an easement. Moreover, if a court determines that the cost of removing an encroachment is substantially greater than the harm being caused by the encroachment, it may allow the encroachment to remain. Much like an unwanted easement, this would have a profound negative effect on property value.
At Neek Law Firm, we not only have extensive knowledge in matters such as entitlement, zoning, property line drawing, and easements/entitlements; we have the experience and relationships in place to provide clients with the highest grade of legal representation available. Regardless of what land-use needs a client may have, Neek Law Firm can help clients meet those needs in a cost-effective yet tailored manner. This is the best way for a client to protect property interests and maximize land or investment values.