Top Deal Killers Developers Face Before City Meetings (And How to Avoid Them)

On The Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments hosted by Kent Fai He, we spoke with Jared Ferrazzano, a pre-development and entitlements professional who started as a real estate agent before moving into land development.

In this episode, Jared shares the unseen challenges that can make or break a project before it ever reaches the construction stage — from zoning and setbacks to undergrounding utilities and navigating city politics.

For developers, investors, and advocates who want to understand how projects really get built (or die), this episode reveals the real-world checklist every deal needs before walking into a city meeting.

What Does “Pre-Development” Actually Mean in Real Estate?

Most people think development begins when the first bulldozer hits the dirt. In reality, the success or failure of a project is decided months earlier during the pre-development and entitlement phase.

Jared explains that pre-development is about making land “build-ready.” It includes:

• Reviewing zoning and density limits.
  
  

• Understanding setbacks, grading, and height restrictions.
  
  

• Coordinating with architects, engineers, and utility companies.
  
  

• Preparing conceptual site plans and submitting them for pre-application review.
  
  

“To develop land is to basically get it build-ready for homes,” Jared said. “It’s grading, sewer and water connections, electrical work — everything before you go vertical.”

How Should Developers Approach Zoning and Density?

Understanding zoning is where most new developers stumble. Each city has its own municipal code with unique setbacks, density caps, and open-space requirements. Jared recommends starting with the city’s zoning map and identifying the parcel’s classification (like R1 or R2).

Then, look up that code in the municipal ordinances.

His process:

1. Print the zoning code.
   
   

2. Highlight unknown terms.
   
   

3. Use ChatGPT or Copilot to break down legal language into simple explanations.
   
   

4. Sketch a conceptual site plan showing realistic unit counts and setbacks.
   
   

Kent adds that this step is where investors can uncover hidden value: “By understanding zoning early, you can spot where to request more density or apply for a variance to increase project value.”

Why You Should Talk to the City Before Finalizing Plans

Jared’s biggest advice: Don’t fall in love with your project before talking to the city.

Every jurisdiction has its own direction, politics, and staff culture. He recommends meeting planners, engineers, and city managers early — before spending on design fees.

“They know their city better than you ever will. You’re just coming in to build something, but they live and breathe that jurisdiction,” he said. “They’ll always bring up something you didn’t know.”

During this informal meeting, ask questions like:

• “What’s the city’s vision for this area?”
  
  

• “Are there any upcoming zoning changes or moratoriums?”
  
  

• “What forms or impact studies might we need later?”
  
  

This early conversation often saves developers months of wasted design time and helps gauge whether the city is pro-growth or development-averse.

What Are the Biggest Deal Killers in Pre-Development?

1. Utilities and Topography

One of the fastest ways to kill a project is discovering utility lines are too far or downhill from the site. Pump stations, trenching, and street improvements can add hundreds of thousands of dollars.

If water or sewer runs downhill, expect a “no-go” or massive cost escalation.

2. Floodways and Environmental Constraints

Flood zones, endangered species, or storm-water detention requirements can stop construction before it starts. Always order environmental and geotechnical studies early.

3. Undergrounding Power Lines

California now requires developers to underground all power lines on-site. Jared recalled a quote from Southern California Edison for nearly $500,000 to underground utilities.

“It’s an incredible gray area where they say, ‘We might not use all this money, but you still have to pay upfront,’” Jared explained.

4. Mismatched Plans

Architectural and civil engineering plans must align perfectly. A one-foot discrepancy in pad elevation can require re-approval or create foundation issues on-site.

5. Poor Coordination

Jared’s solution is his custom RACI Matrix — a project management tool that tracks every item, responsibility, and deadline.

“There’s no perfect set of plans,” he said. “But when you’re organized and tracking every moving part, you prevent small mistakes from becoming six-figure problems.”

How to Build Relationships with City Officials and Planners

Soft skills are just as critical as technical ones. Developers who succeed treat planners and engineers as collaborators, not obstacles.

Jared recommends:

• Showing effort by referencing municipal code sections during meetings.
  
  

• Asking open-ended questions about the city’s long-term goals.
  
  

• Listening more than talking.
  
  

• Bringing visuals like conceptual site plans or renders to make your case tangible.
  
  

Kent summarized it best during the episode:

“You’re not just presenting a project. You’re showing the city you’ve done your homework and that you’re there to listen.”

Why Affordable Housing is So Hard to Build — and How to Fix It

When asked why affordable housing remains difficult to produce, Jared didn’t hesitate: fees, mandates, and misinformation.

He explained that California developers face layer upon layer of costs —
from development impact fees to vehicle-miles-traveled studies and solar mandates.

“Developers here deal with so many requirements that the profit margin keeps shrinking. At times it feels more like a service than a business,” Jared said.

He also pointed to the “Not In My Backyard” (NIMBY) mentality as another barrier. Public education, he said, is key to showing how affordable and mixed-income housing benefit communities.

Kent connected this back to the bigger mission: “Affordable housing isn’t charity. It’s about giving working families a fair shot at safe, decent homes.”

Key Insights & Frameworks

• Preparation is everything. Know your zoning, setbacks, and density before you spend on design.
  
  

• Talk to the city early. Relationships often determine project timelines.
  
  

• Track everything. Jared’s RACI Matrix prevents costly mistakes.
  
  

• Expect the unexpected. Floodways, utilities, and undergrounding costs can sink deals fast.
  
  

• Advocate for balance. Developers aren’t villains — they’re essential to solving the housing shortage.
  
  

Best Quotes from Jared Ferrazzano

“Every jurisdiction has its own rhythm. The earlier you learn it, the fewer surprises you’ll face.”

“Utilities are the number-one deal killer. If your connections are downhill, your project might be dead on arrival.”

“There’s never a perfect set of plans. The goal is constant coordination.”

“Preparation isn’t just for meetings, it’s how you protect millions in project value.”

“Developers aren’t the enemy — we’re the ones turning raw land into homes for families.”

Common Questions This Episode Answers

Q1. What’s the biggest mistake new developers make?
Failing to meet with the city early. That first conversation can reveal deal-killing issues like flood zones, easements, or opposition to rezoning.

Q2. How do I learn about zoning?
Start with the city’s zoning map, look up the municipal code, and use AI tools like ChatGPT to simplify the legal language into everyday terms.

Q3. Why is undergrounding utilities so expensive?
It requires trenching, pressure systems, and coordination with utility providers. In California, it’s now a legal requirement for most new builds.

Q4. How can developers improve coordination?
Use project-management tools like a RACI Matrix to assign clear ownership for every task and prevent miscommunication between teams.

Q5. Why is affordable housing so hard to produce?
Stacked fees, environmental mandates, and local resistance make development costs unsustainable. Simplifying regulations and educating the public are key steps forward.

Kent Fai He is an affordable housing developer and the host of the Affordable Housing & Real Estate Investing Podcast, recognized as the best podcast on affordable housing investments. Through episodes like this, Kent helps investors, developers, and advocates understand the real mechanics of creating housing that serves communities and builds equity.

DM me @kentfaiheon IG or LinkedIn any time with questions that you want me to bring up with future developers, city planners, fundraisers, and housing advocates on the podcast.