NSP FAQ
Q

What factors should be considered when a grantee or subrecipient establishes a "reasonable" developer fee?

Date Published: October 2012

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A

There is no cap or limit on a developer fee, and there are a number of factors involved when determining if a developer fee is reasonable. Grantees should consider:

  • The risk of the project and typical levels of return for similar types of projects.
  • Reasonable and customary fees for similar types of projects in their community.
  • Other sources of developer profit, in addition to the developer fee, such as builder’s profits, property management fees, and cash flow.
  • The size of the project and how much work a developer is putting into the project.

Tags: NSP Financial and Grants Management - Procurement

FAQ ID:

1088