Real Estate Development Accounting
Development accounting for ground-up projects, tenant improvements, and everything in between.
What This Is
Development accounting is a different animal from operating bookkeeping. A project has a capitalized cost basis that grows over months or years, a budget that gets reforecast as conditions change, draws that need to tie back to approved contracts, and a reporting obligation to partners and lenders who want to see where their money went.
Dennis spent nearly a decade at Alexandria Real Estate Equities managing development accounting across five regions, then built the accounting function from scratch at a private development firm where he still works today. This service applies that same approach to your projects whether you’re doing a single ground-up build, a tenant improvement buildout, or a portfolio of active developments.
The Project Side
The Project Side
Project and job costing by phase and cost code. Budgets built at the line item level and reforecast as actuals come in. Progress billing and draw package preparation with supporting documentation. Hard cost, soft cost, and contingency tracking through the full lifecycle.
The Reporting Side
The Reporting Side
Joint venture reporting with proper allocations. Bank and lender reporting packages that match what construction loan officers actually want to see. Partner reporting that holds up to questions. Monthly close routines that treat each project as its own reporting unit.
Why This Matters
Most general bookkeepers don’t handle development projects because the work sits outside their experience. They can run your operating books, but they don’t know how to capitalize costs properly, tie a draw package back to the loan budget, or produce the kind of reporting a joint venture partner expects. The result is books that look fine on the surface but don’t hold up when a lender or partner asks real questions.
On a development project, small accounting problems compound into expensive ones. A cost coded to the wrong bucket moves dollars across capitalization categories. A missed retention entry creates problems at closeout. A reforecast that doesn’t tie to contracts in place leaves leadership making decisions on numbers that aren’t real. These are the kinds of issues Dennis has spent his career finding and fixing.
Lender and Partner Scrutiny
Lender and Partner Scrutiny
Construction lenders want draws tied to the approved budget. Joint venture partners want reporting that matches the operating agreement. If your accounting can’t produce what they’re asking for, trust erodes and future deals get harder. Getting this right is a precondition for raising capital on the next project.
Cost Categorization
Cost Categorization
Development costs need to land in the right category for tax, reporting, and capitalization purposes. Hard costs, soft costs, interest, and indirect costs each follow different rules. Getting categorization wrong early means cleaning it up later, which is always more expensive and sometimes too late to fix cleanly.
What Changes
Every project has a clean cost basis built from approved contracts, change orders, and invoices coded to the right phase and cost code. Budgets live next to actuals so variances are visible while there’s still time to act on them. Draws go out on schedule with backup that answers the lender’s questions before they ask.
Partners get reporting that matches the deal structure. Leadership gets numbers that tie together across projects. Closeout at substantial completion becomes a clean handoff to operations instead of a months-long cleanup exercise. The full lifecycle from design through construction to tenant improvements stays accounted for consistently.
Draw Packages That Work
Draw Packages That Work
Monthly draws prepared with the supporting schedules lenders expect. Costs reconciled to the loan budget. Retention tracked properly. Documentation organized so inspections and bank reviews move quickly instead of stalling on missing backup.
Reforecasts You Can Trust
Reforecasts You Can Trust
Budget versus actual analysis that reflects contracts in place, not stale assumptions. Contingency usage tracked deliberately. Projected cost to complete based on what’s actually happening on site. Numbers that let leadership make real decisions instead of guessing.
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