COMMENT OF THE DAY RUNNER-UP: COWARDS SHAPE THE CITY “. . . Has it ever occurred to you that developers (whose core competency is development) develop apartment complexes for long-term investors and operators? What you refer to as cutting and running is actually just an element of their business model. It is a hand-off of ownership from one entity preferring stability to another that demands it. Neither entity is assured of stability, however.
A developer can’t pretend (with a straight face) to know what is in store for a nation, a metropolitan area, or a submarket over a five-year period of planning, permitting, financing, construction, the first year of lease-up, the second year of burning through concessions, and the third year of stability so that they can generate a reliable set of T-12 profit and loss figures.
As it turns out, they have to make an educated guess about the future, close their eyes, hold their nose, and jump in.
The business model may be different, however the same lesson is analogous for subdivision developers and home buyers, too. They can only try their best to make the right decision, then hope for the best. But eventually . . . they all sell. Everybody sells. The only consequential purpose in owning real estate is to be able to sell it. If selling something is cutting and running, then our entire society is founded on cowardice.” [TheNiche, commenting on Comment of the Day: The Shelf Life of Apartment Complexes]