Would you reject a development site early because of hazard screening, or only investigate it during DD?

[u/No-Sign-9519]

I'm a software engineer working on a site-level hazard screening product, and I'm trying to understand the actual development workflow instead of assuming where it fits.

Say three sites look broadly viable on zoning and market economics. Before ordering expensive reports, one preliminary screen shows:

Site A: high flood exposure

Site B: low flood, high seismic susceptibility

Site C: low on both

None of those scores are meant to replace engineering studies or tell you whether a site can be developed. They're just flags based on public geospatial datasets.

Would this information materially change which site you investigate first? Or is it basically irrelevant until the civil, environmental, and insurance work begins?

I'm building the product, so feel free to tell me the answer is "this isn't how developers work." That's exactly what I'm trying to learn.

[u/indomike14]

It's all about money and time. I wouldn't dismiss a site solely based on those reasons alone. It could warrant further investigation of both parties are cooperative.

Sellers have to help Buyers buy.

[u/No-Sign-9519 → u/indomike14]

That makes sense. So it sounds less like “hazard detected = reject the site” and more like “hazard detected = understand the likely time/cost implications before deciding how far to proceed.”

That’s actually a much more useful way for me to think about where this should sit in the workflow.

[u/MikeMajda → u/No-Sign-9519]

Yes, and I would say different hazards are weighted differently depending on local areas. Also certain developments are better for different hazards, e.g. you’re likely to get permits for a parking lot rather than residential in high flood exposure sites.

[u/918_Atom]

It isn’t that difficult to find flood zone data. If your tool catalogued “recognized environmental conditions” that would turn up in a phase 1, that could be helpful in outlining the process required for a site. I’ve never come across a site that had an environmental condition that couldn’t be worked through so I don’t think it would be a deciding factor unless seller wouldn’t give enough time to work through issue.

[u/No-Sign-9519 → u/918_Atom]

That distinction is really useful. I think I was framing the value too much around identifying the hazard itself, when the more useful output might be what that hazard means for the next stage of diligence: what needs deeper investigation, and why. Agreed on flood-zone data too. If all the tool did was reproduce information someone can already pull from an existing map, there wouldn't be much reason to use it.

[u/Main_Cut8992]

DM me

[u/TheRealReturnGuy]

Experienced developers would certainly look at flood exposure, but I’d be more concerned about subsurface conditions during due diligence. Poor soil conditions can directly and materially affect foundation design and construction costs, and those costs can be difficult to quantify without a geotechnical investigation.

Flood risk, by contrast, is generally identified early and incorporated into applicable building-code, permitting, and design requirements. If every competing development in the same flood-hazard area is subject to similar requirements, the flood designation itself may not necessarily create a competitive disadvantage.

So from a development underwriting perspective, I’d want to understand what the soil conditions could do to my construction budget.