Money and Power: A How-to Guide for Real Estate Developers

guest blog by Deborah Goonan

1)  Promise local planning and development commissioners that your Utopian projects – including planned communities (HOAs) and condominiums – will increase tax revenues beyond their wildest dreams, without any fiscal impact to local government.

2)  Dangle the carrots: wealthy domestic and foreign investors willing to provide capital financing to get the project going.

3)  Promise to provide “affordable housing,” but make it clear that, in order to do so, you may have to cut corners and build crap. And, after you turn over the community to all of those homeowners, you don’t want them to come crying to you, when their homes and the whole darn place starts falling apart! Therefore, insist upon laws, policies, and procedures that will shield you from liability for construction defects. Otherwise, you won’t be able to deliver on your promises.

4)  Hire cheap labor, even if they lack skills or pride in their workmanship. Build as fast as possible! Get the state to allow you to hire your own private inspectors to verify that all construction meets code requirements. That takes city and county inspectors off the hook, right?

5)  Require that all construction defect claims and disputes must be settled in secret before an Arbitrator (preferably one that you choose). Write this into the deed restrictions, and don’t allow homeowners to amend this requirement without your consent. You don’t want future buyers to be afraid to buy your crap.

6)  Lobby state legislature for provisions that will reduce the statute of limitations for making defect claims, or reduce the scope of warranty coverage. Put the homeowners on the hook for the cost of repairs.

7)  Fund campaigns for political allies with direct or indirect ties to real estate development. Offer lucrative employment or investment opportunities after their term in office expires.

8)  Build your Real Estate Empire through vertical integration. Acquire construction and building material companies, as well as maintenance companies. Be sure to partner with at least one well-entrenched management company. When common area repairs are inevitably needed, tap into all of those affiliations for perpetual revenue streams.

Think I’m making up these “strategies” or exaggerating? Here are two links that will make your blood boil!

(First Coast News construction defect investigation, Anne Schindler, FL)

(precedent-setting interpretation of crafty Colorado construction defect law)


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Ward Lucas is a longtime investigative journalist and television news anchor. He has won more than 70 national and regional awards for Excellence in Journalism, Creative Writing and community involvement. His new book, "Neighbors At War: the Creepy Case Against Your Homeowners Association," is now available for purchase. In it, he discusses the American homeowners association movement, from its racist origins, to its transformation into a lucrative money machine for the nation's legal industry. From scams to outright violence to foreclosures and neighborhood collapses across the country, the reader will find this book enormously compelling and a necessary read for every homeowner. Knowledge is self-defense. No homeowner contemplating life in an HOA should neglect reading this book. No HOA board officer should overlook this examination of the pitfalls in HOA management. And no lawyer representing either side in an HOA dispute should gloss over what homeowners are saying or believing about the lawsuit industry.

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