A real estate development agreement is an agreement between two parties; a developer or a construction company and the owner of the land. This agreement refers to the construction and development of a commercial or retail project on the property. The developer is usually named as the construction or the development manager of the project. The developer’s duty is to be responsible for the negotiation with regard to its structural, engineering and construction contracts, including those with its sub-contracts. It is also the duty of the developer to obtain necessary insurance, permits and licenses pursuant to its construction, and arrange for any financial commitments. The developer manages the construction itself, hiring and leasing, coordinates with advertising, receives revenues obtained from the project and pays all expenses and liabilities incurred.
Developers use a Land Development Agreement with and pursuant to the City or Township issuing the permit to the developer for the construction and development of a commercial site and/or retail project. The provisions of a development agreement include limitations on setback lands, requirements for structural drawings, load estimation, development and construction of parking, loading bays, and messenger booths; building an access and control over public areas necessary for handicapped and settling all disputes for any negotiation.
The typical real estate development agreement is a comprehensive agreement because it tackles specific arrangements that encompass specified details. This makes it quite extensive and requires the the nurturing help of sophisticated lawyers such as those at Levy Zavet PC.
The first part of the agreement is for the definition of terms used in the agreement. For the development of a commercial property, there would be dozens of definitions that would be specified and defined. This is necessary for clarity and for accuracy. The next part would be for the construction and development itself, which include the plan sketches of the project and the ground rules in the construction, such as time frame, property limits, etc. This section is often short and simple because it is precise. The next part is the improvement section which is quite long that makes the development agreement lengthy. This section summarizes all possible limitations that would affect the City or Township in accordance with the construction, like improving sewer lines that might be affected. All public properties affected along the way should be specifically identified in the agreement. The last part would be for the conformity on landscaping rules, parking rules and for the deadline of the building and construction.
The real estate development agreement is obligatory when starting any construction. This would be an agreement between the developer and the City or Township as well, and would most definitely need the help of our strong legal team at Levy Zavet PC.