Development & Land

Development accounting is about costs becoming an asset. We track every dollar from land acquisition through completion so you always know where the project stands.

A Different Kind of Accounting

Operating real estate has rent coming in and expenses going out. Development is different. Nearly everything is an outflow that becomes part of an asset you are building. The accounting question is not what you netted this month. It is what you have spent, where it went, and how that compares to what you planned to spend.

Most bookkeepers are set up for operating properties. They know rental income, vendor payments, bank reconciliation. Development requires a different structure entirely. You are tracking costs that will become the basis of an asset you will either sell or hold. The chart of accounts needs to reflect your budget categories. Hard costs, soft costs, contingency, interest carry, closing costs on both ends. Every dollar needs to end up in the right place because it affects your cost basis, your draw requests, and eventually your gain or loss when you exit.

We set up development books that work the way development actually works. Budget categories that match your pro forma. Cost tracking that supports your draw schedule. A structure that keeps the project organized from land acquisition through completion and disposition.

What We Track

Construction draws need supporting documentation showing work completed and costs incurred. If your books are messy, draws get delayed while you scramble for backup. You end up covering costs out of pocket waiting for reimbursement that should have arrived two weeks ago. We keep draw tracking tight so when it is time to request funds from your lender, the documentation is already organized and the request goes out on schedule.

Your development budget has categories. General contractor, site work, concrete, MEP, architectural, engineering, legal, permits, insurance, interest carry, contingency. The books need to reflect those same categories so you can compare actual spending to budget at any point. We set up tracking that mirrors your budget structure. When you pull a cost report, it matches the line items you underwrote at the start.

Capitalized Costs

Most costs during development get capitalized into project basis. Loan interest, insurance, property taxes during construction, professional fees. Getting this wrong affects your tax position and your true per-unit or per-square-foot cost. We make sure costs are treated correctly from the start.

Change Orders

Scope changes. Unexpected conditions. Owner modifications. Every project has them and each one affects total project cost. We track change orders separately so you can see original budget, approved changes, pending changes, and revised total at any time.

What Goes Wrong

The most common problem is discovering budget overruns too late. You are three months from completion and realize you are $300,000 over budget. The costs were there all along but nobody was tracking actuals against budget in a way that made the variance obvious early. By the time you see it, your options are limited. You either cut somewhere else, go back to your lender for more proceeds, or fund the gap yourself. None of those conversations are pleasant when they happen at the last minute.

Draw documentation is the other recurring headache. Your lender wants backup for a $600,000 draw and your contractor invoices do not match your budget categories. You spend two weeks reassembling paperwork and chasing down lien waivers instead of getting reimbursed. Meanwhile you are carrying costs on your line of credit and paying interest on money you should have been reimbursed for already.

Mixed Up Cost Treatment

Costs that should be capitalized get expensed. Costs that should hit the project get charged to the operating company. At the end of the project your basis is wrong, your tax treatment is off, and cleaning it up takes more time and money than doing it right would have.

No Project-Level Visibility

You are running three projects at different stages. One in entitlement, one mid-construction, one wrapping up. You can tell if your bank account has money but you cannot see where each project actually stands against its budget without digging through spreadsheets for half a day.

What Changes

Project tracking runs from acquisition through completion and exit. Land costs, due diligence, entitlement, vertical construction, interest carry, lease-up or sale costs. All in one place with a structure that matches your budget and supports your draw schedule. You can pull a report at any point and see exactly where the project stands against plan.

When hard costs run over, you know before you have burned through contingency. When soft costs come in under, that is money you can reallocate. Draw requests go out with documentation already organized by budget category. Reimbursements happen on schedule instead of getting delayed by paperwork chases. And when the project is done, you know exactly what it cost to build. If you sell, your gain calculation is clean. If you hold, your depreciation basis is correct and defensible.

Who This Is For

Ground-up developers, value-add operators with significant construction components, land investors holding through entitlement. Single projects through a pipeline of active deals. Whether you are building to sell or building to hold, the accounting structure needs to match the way development actually works.

Working With Your Team

We work alongside your general contractor, construction lender, and equity partners. Draw schedules stay coordinated. Lender reporting arrives on time. Investor updates include accurate cost-to-date and budget variance. You stay focused on getting the project built while we keep the numbers clean behind you.

Boutique Real Estate Accounting Firm