Eric Masaschi: Before the Home, There’s the Land

A home builder cannot build on a piece of land just because it is for sale. Before a single foundation is poured, someone must determine whether the property can support a community, secure the necessary approvals, solve its infrastructure challenges and make the numbers work. 

Eric Masaschi knows that process well. Known as the “Landman,” Masaschi is East Region president of Forestar, where he leads a team responsible for finding and developing residential land across Georgia, Tennessee, Alabama and the North Gulf Coast. Forestar takes land from acquisition through entitlements, engineering and infrastructure before delivering finished lots to home builders. 

Masaschi joins host Carol Morgan on Atlanta Real Estate Forum Radio to discuss what happens before the homes and streets buyers recognize ever exist. His perspective offers a different way to look at new home construction: The house may be the most visible part of the process, but the land sets the stage for everything that follows. 

For a land developer, finding a desirable property is only the beginning. The first question is whether the site can actually support a viable community. Location matters, but so does what the property can accommodate. A site needs enough usable land for the right number of homes, access to necessary utilities and a path through the local approval process. Atlanta’s topography can add another wrinkle, particularly when the terrain affects whether homes can support basements. 

Then there are conditions that cannot be changed. Rock, wetlands and stream crossings can quickly complicate a project and drive up its cost. 

“There are lots of things that can then make a deal go sideways pretty quickly,” Masaschi said. 

That is why evaluating a property involves far more than looking at its location or asking price. The opportunity must work both physically and financially before a developer can move forward. 

Land cost is only the starting point. The number of homes a site can support, the work required to prepare it and the fees associated with development all affect what a finished lot ultimately costs. A project that looks promising at first can become a very different investment as those expenses add up. 

That uncertainty sets land development apart from home construction, where builders can track labor and material costs through established processes. Every parcel brings a different set of circumstances, making the front end of a project harder to predict. 

The financial equation becomes even more challenging when a project takes longer than expected. Masaschi shared a recent example in which a final plat approval expected to take about two months stretched to six. By that point, the developer had already spent roughly 95% of the project’s capital, leaving significant money tied up while the project waited for its final approval. 

The impact goes beyond the developer’s balance sheet. A home builder may have a sales team, employees and other resources preparing to open a community, only to have the timeline pushed back. Predictability often matters just as much as speed. A developer can plan around a known timeline. An uncertain one makes it much harder to manage interest, carrying costs and the eventual delivery of lots to the builder. 

The work behind a new community can feel far removed from the buyer standing in a model home. But the two are connected. The price of a new home reflects more than framing, finishes and labor. It also reflects the years of work and investment required to prepare the land for construction. 

“I want my kids to be able to have the American dream and have a house sooner than later,” he said. 

A new home may be the finished product, but getting there starts long before construction. The land has to work physically, financially and through the development process before a home builder can ever break ground. 

Listen to the full episode of Atlanta Real Estate Forum Radio to hear Masaschi discuss the work that happens before construction, what can make a residential site difficult to develop and how longer development timelines affect the housing pipeline. To learn more about Forestar and its approach to residential land development, visit https://www.forestar.com/. 

Forestar is one of the largest residential community developers in the country, developing residential lots for local, regional and national home builders. The company acquires and develops land, secures entitlements and prepares communities for home construction. Forestar has active projects in more than 60 markets across 24 states and more than 200 projects underway nationwide. The company also works with landowners to acquire properties and develop projects in phases based on individual sites and market needs. 

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