First-Time Developers: Strategies, Funding & Zoning Tips

Andrew Overton (00:00)
That’s an approach we take at Creative Land Strategies is go start with the people, do everything we can to make our project seem like their idea.

and have the citizens push our projects through. And we found that to be the most successful way.

Dylan Silver (01:47)
folks, welcome back to the show. Today’s guest is based in Damascus, Virginia and runs Creative Land Strategies, a real estate development consulting firm that helps developers get into their first projects. He also recently launched a real estate development course. Please welcome Drew Overton. Drew, welcome to the show.

Andrew Overton (02:09)
Hey, thank you. Glad to be here.

Dylan Silver (02:11)
It’s great to have you. We were talking a bit before hopping on here about how you got into the real estate world, the real estate space. And it was an interesting journey that involved cell towers.

Andrew Overton (02:23)
Yeah, correct. Right after law school, I found a position in Chicago with a small development firm that focused on wireless industry ⁓ as well as medical industry. yeah, I drew the short straw and ended up on a project in Cleveland, Ohio, where they just gave me a credit card and said, get an office and hire a staff. so that’s what I did. And it ended up being a very successful.

program for us. did 117 sites four months ahead of schedule and 17 million under budget.

Dylan Silver (02:53)
I think ⁓ a lot of people when they hear a success story like that may think, well, you were destined for real estate. Did you know at any point in time up to this point that you were going to be a real estate guy or was this something new?

Andrew Overton (03:06)
Not at all. I actually chose the law school I went to in Chicago, which is now the University of Illinois at Chicago at the time. It was the John Marshall Law School. And because it had the highest rated intellectual property program, or second highest rated in the country at the time. And then I took a patent class in law school and quickly realized I would fail miserably.

Dylan Silver (03:27)
You

Andrew Overton (03:28)
intellectual

property. And so I went, yeah, I fell into real estate and you know, you get into something and opportunities come your way. You tend to stay with it. So starting from scratch to do something else is not, it’s not always inspiring. And, you know, I had had dreams of, you know, producing films and directing and these types of things. And

Dylan Silver (03:48)
Yeah.

Andrew Overton (03:49)
But unfortunately, I had no talent for that, which is challenging. I didn’t have the money for that, which is also challenging. So I thought, well, let me stick with this so I can pay my bills and I can kind of move forward with life. And I’ve enjoyed it. It’s actually gotten more enjoyable as time’s gone on. And the clients have changed initially.

Dylan Silver (03:53)
You need that. ⁓

Andrew Overton (04:11)
My clients were Fortune 500, Fortune 200 companies, even outside of the wireless as we got into working with gas stations and out of home advertising, which is billboards essentially. All of that paid really well, but it really started to become more fun as we worked

smaller developers. And it first started at a zoning hearing in Long Island, New York, Suffolk County.

Dylan Silver (05:24)
Mmm.

Andrew Overton (05:25)
One of the most

Dylan Silver (05:25)
Yeah.

Andrew Overton (05:26)
difficult places, and that’s really where Creative Land Strategies got its start was in Suffolk County and Nassau County on Long Island. So two of the most difficult areas to develop anything. yeah, the zoning hearings would be people fighting over like two inches of fence height. And you’re just, yeah, because like, I mean, this is what you’re mad about. So.

Dylan Silver (05:36)
Yeah, it sounds like it.

Shaking your head.

Andrew Overton (05:49)
So zoning attorneys on Long Island did really well because everybody fought about everything. But I tell a story of being working on a site in the middle of Long Island, but Suffolk County, the electeds is what we call them. So the council person from that district, we always go in and meet with them first before we bring a project forward.

And I’m not going to give you the time frame for this, but they wanted money. Not flat out, you know, in their pocket money, but they wanted basically a large amount of money to push this through. And that was simply something that we couldn’t do ethically, but it’s common on Long Island.

Dylan Silver (06:13)
Sure.

Yeah.

Andrew Overton (06:30)
Yeah, people get arrested there a lot. So what we did to kind of turn the tables on that is we went and met with the civic associations that surrounded this particular site. And we said, this is what we want to do. What do you think? Right. How do you feel about this? What would make this better? What would make this more palatable?

Dylan Silver (06:33)
Okay

Andrew Overton (06:53)
After a few meetings and talking and you know the head of the civic association met with you know them and then I went and did a presentation for them and at the end of the day they needed help with a baseball park to clean it up and put some more garbage cans things like that and then they wanted a gazebo.

Dylan Silver (07:10)
As you do, yeah.

Andrew Overton (07:11)
Yeah,

as one might, but it was an interesting choice of where they wanted it, which was basically in a Home Depot parking lot, like up towards the road, and they wanted a water feature. And we went into Home Depot and said, hey, what’s it cost for a gazebo? So that’s what it ended up costing to then get

Dylan Silver (07:20)
Okay.

Yeah.

Andrew Overton (07:34)
the civic association on board and get them to show up at the zoning hearing supporting the project that we’re doing. The elected doesn’t have any choice. They’re not going to go against the civic association that wants this deal to be done.

that’s an approach we take at Creative Land Strategies is go start with the people, do everything we can to make our project seem like their idea.

and have the citizens push our projects through. And we found that to be the most successful way.

lot of your big developers don’t feel that way. They would rather just hire big law firms and approach it from that point of view. But my clients don’t have the money for that. They don’t have the money to hire a $400 an hour attorney to fight this. I just read

in Carmel by the Sea in California, a six year process for a development project. Six years. 20 unit apartments, obviously beautiful, it’s by the ocean. But six years and they believed, the developer believed they had it all wrapped up and at the very last minute, city council didn’t approve it. And that was six years of work. Millions of dollars. And

Dylan Silver (08:34)
Yeah.

Ugh.

Andrew Overton (08:46)
You know, the small developer just doesn’t have that. This guy is a billionaire, right? So he can afford it, but, you know, most people can’t.

Dylan Silver (09:28)
The small developer, think, you know, when people who may not be in the space think about small developer, I think, well, how small could a developer be if you’re building out a subdivision? You know, it’s not like you’re exactly, you know, rubbing two pennies together. You must have some large nest egg to be building out a subdivision. if you can, Drew, paint a picture for us of what would it be like or someone who may potentially be that first time developer. What are they looking at? What’s kind of their day to day like?

is the information that they’re playing with and what is the information also that they don’t have that they’re coming to you for.

Andrew Overton (10:00)
Yeah, those are good questions. I will give an example of a client of ours that ⁓ she’s based in California. She’s a person of means, but to develop in California, you need a lot of money. And she’s looking at investing around a million dollars. So she has asked us to look at other areas where she might want to invest.

With that kind of money, what you can do in Cleveland or Indianapolis, which are two places that we said, Hey, look, there’s growth here. Property is really inexpensive if you want to, I mean, compared to other places in the country, right? So it’s affordable and what you can do with a million dollars there is a lot, right? So if you wanted to buy, for instance, vacant property and

Dylan Silver (10:31)
Yeah.

fish.

Andrew Overton (10:44)
You know scale it start with you know you’re gonna build a townhouse or you’re build multifamily there Presale things like that for a million dollars. I mean right now you’re looking even where I am currently in Southwest, Virginia Just to do a renovation your your costs are $250 a square foot and we are rural Rural Virginia right now

Dylan Silver (11:07)
Yep.

Andrew Overton (11:12)
So, but those are prices that I paid, you know, 15 years ago in New York, you 250 square foot to have a renovation done. So that’s where she’s going to invest. We do have people talk to us fairly frequently about syndication deals. We’re not financial advisors is what I say when I get asked about syndication.

Dylan Silver (11:31)
Tunecations, yeah.

Andrew Overton (11:32)
Yeah, because I just, us, even on an individual level, if I was going to invest in something, I wouldn’t do it with that vehicle. It’s just too much risk. but syndication is one thing. We do often recommend that they get together with friends and pool. It’s not the same thing as syndication. You can do a limited partnership or an LLC. Yeah. So.

Dylan Silver (11:41)
I agree.

No. It’s not securitized.

Andrew Overton (11:56)
We recommend that they do things like that. We have something interesting that came up. I learned about three years ago as a tool for real estate development and finding the finances to do it. It’s called a self-directed IRA. Are you familiar with that?

Dylan Silver (12:09)
Yep.

I’ve had someone on here specifically, I guess, specializes in that walk, walk through every little nook and cranny of what you can’t do. I guess it has to be it’s either one or the other. I believe it has to be considered active. Is that right? Like you it has to be it’s either active or passive. It’s one of the two. I’m pretty sure it’s active, although it could be the other one. You have to have some type of means in the business.

Andrew Overton (12:14)
Yeah.

Yeah.

Yeah

Yeah, you can’t do any self-dealing with it. Meaning you can’t even have a close family member, let’s say you bought a condo and you want to rent it out. That’s fine. You can buy the condo and rent it out, but you can’t rent it to your son even if he’s paying full market value. Does that make sense? So there are rules with that. But what people don’t understand, and as you said, you’ve done a whole course on this, is that you can take your traditional IRA that has

Dylan Silver (12:50)
Ryan.

Andrew Overton (13:40)
you know, six, $700,000 in it and convert that to a self-directed IRA. And you can even take it a step further and put it into what they call a checkbook control LLC, because as you know, a lot of real estate deals get done very quickly, right? So you want to have access to those funds. And that includes if you’re buying a foreclosure, you like you have to pay then, or if you’re just doing a deal in a bar, which I’ve never done, but I’ve heard people say it gets done. I would like to see that.

Dylan Silver (14:04)
On the back

for napkin, yeah.

Andrew Overton (14:05)
You

know, there’s tales of that, but I’ve never actually seen it. But yeah, so having access to your funds immediately. that’s, you know, it was fascinating to me that I worked 22 years in real estate development and then never heard that. Right? Right?

Dylan Silver (14:22)
Yeah, well, there’s always a tomorrow, right? So maybe it’ll

be the next one. I do want to pivot a bit here, Drew, and ask you about how the real estate development course came about. It seems to go hand in hand. I know you just released the course with the consulting. Was there a need that you felt like people were wanting kind of a more formalized coursework or education where they weren’t getting elsewhere? And so you said, hey, let me come and fill this niche.

Andrew Overton (14:48)
Absolutely. ⁓ It was really stemmed from our clients not having a good base knowledge of real estate and paying us as consultants to basically teach them the basics. And we also had clients, I think as you and I had discussed that would look at doing seminars, like weekend seminars and spending thousands upon thousands of dollars. And we just didn’t feel like that was necessary. That you just needed a good basic understanding of what all these terms were, because they are

many, right? And there are many different things that you have to deal with as a developer. And so, yeah, we just said, let’s do this. And we did look and see, like, NAIOP has a course, Cornell has a certificate course, but these are expensive, right? And we didn’t want something that was unaccessible, right? So thousands of dollars to me. Are there people that can spend that? Sure. Do they need to?

Dylan Silver (15:31)
Yeah.

Andrew Overton (15:41)
I mean, I don’t know that a certificate is going to bring you more success, you know, because you have a certificate from Cornell. I just don’t know why it would because really it’s going to come down to, and we can talk about this a little further. You got to build relationships in real, you know, and that’s probably the most important thing that we teach anybody. Part of building those relationships is having an understanding of your subject matter, right?

Dylan Silver (15:57)
That’s it.

Andrew Overton (16:08)
And so that’s what we wanted people to have is a basic understanding and we go past basic but you know, it’s You’re not gonna learn cap rates and how to calculate And do that till you do a couple of them, right? You do those calculations and it’s anything else and it’s you know How do you work with planning and zoning and I likened the the developers role?

Dylan Silver (16:21)
Yep.

Andrew Overton (16:30)
as that of a producer and sometimes producer director on a film or theater, symphony, what have you, because you’re, you’re dealing with all these different, people that you’ve got architects in there. got engineers, got planners, construction, you have all these different things and you have to conduct all that. And you need to understand who you’re talking to, why you need them. You know, you may think you don’t need a traffic study, but you do.

Right? So you have to find the traffic engineer and you’ve got to, you know, be able to have the conversation. You basically need to become an expert in each of these things. And we just didn’t see where that was happening anywhere else. And, we’ve seen a lot of courses and we’ve had clients talk about these courses on flip your first house next week or whatever it is. Well, you know, let us kind of get rich quick. You’re going to be amazed at how easy this is to do.

Dylan Silver (17:12)
Rain.

Andrew Overton (17:18)
and you know, at having done this for 25 years, there’s not a moment where I go, well, this is really easy. I mean, some, some deals go really well and that’s great. And it’s usually with people that you’ve worked with before, but other deals are like, man, this is taking a really long time. ⁓ and you don’t control it. Like if, if, if it takes a planning department X amount of time,

Dylan Silver (17:35)
Yeah,

Andrew Overton (17:41)
to review your application and to get it in front of the planning board. You’re back and forth on your drawings. That’s what it takes. You don’t have control over that. Like there’s no box you can check and say this will be done on this date. And again, part of that’s your relationship. What is your relationship with that local board? What is with the planning department? I mean, that’s the first person you introduce yourself to be really nice to because they’re a gateway.

Dylan Silver (17:53)
Yeah.

Andrew Overton (18:04)
So the relationship building is huge. Probably the most important thing.

Dylan Silver (18:06)
huge. It’s interesting.

It’s interesting to hear attorneys perspective telling people not necessarily to jump to litigation. Nice. It’s a different perspective because you’re right. lot of people, especially you mentioned the gentleman who spent six years litigating and didn’t end up being able to proceed. mean, you have to be prepared for that. And it’s a lot of money. And if you’re starting out, there is that risk. I mean, we’re in real estate, so it’s everyone’s biggest asset for the most part.

Andrew Overton (18:14)
Yo, yeah.

Dylan Silver (18:34)
But if you can avoid a lot of those headaches, I mean, it certainly behooves you. are coming up on time here though, Drew. Where can folks go if maybe they have ⁓ a deal that they’d like your feedback on or if they would like to learn some more about the consulting firm or the course that you just released?

Andrew Overton (18:38)
Yeah.

Sure.

Yeah, great. I should point out right now we have one course that’s available for free and that’s data analytics in real estate development. And it just gives you a nice baseline of where you can access information for free, information that you’ll need. So with that, it’s www.creativelandstrategies.com.

Dylan Silver (19:10)
Drew, thank you so much for coming on the show here today.

Andrew Overton (19:13)
Yeah, it was great. Thanks for having