💡 Understanding Soft Costs in Real Estate Development
Soft costs are the indirect, behind-the-scenes expenses that influence a project’s success—even though they don’t directly build the structure. These include:
Planning & Design – Architectural drawings, engineering, feasibility studies, surveys
Permits & Legal – Approvals, zoning, compliance, legal support
Financing – Loan interest, lender charges, banking fees
Administration – Staff salaries, project management, software, tools
Marketing & Leasing – Campaigns, brochures, websites, open houses
Insurance – Liability, builder’s risk, property insurance
Post-Construction – Security, maintenance, property management
Additional Costs – Depending on project scope
👉 Successful developers know: Controlling soft costs is vital for higher ROI.
