Land Subdivision
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,600 land subdivision firms in the US purchase and prepare property for division into multiple lots and subsequent sale to builders for residential, commercial, or industrial use. They typically develop property that they own, but may also subdivide and prepare sites for other property owners. About 66% of land subdivision firms have no employees. They rely on subcontractors to perform all services in preparing land for development.
Complying with Government Regulation
Land subdivision firms must comply with a wide range of federal, state, and local regulations governing land development.
Local Opposition To Development
Concerns over rampant growth or changes to existing neighborhoods can lead to opposition to new land subdivision projects.
Industry size & Structure
The average land subdivision firm with employees has about 8 workers and generates about $2 million in annual revenue.
- The land subdivision industry consists of 4,600 firms with 38,500 employees and generate about $10.7 billion annually.
- The average single operator (non-employer) firm generates $176,000 in annual revenue.
- Single operator firms rely on subcontractors to perform all services in preparing land for development.
- About 79% of firms with employees have less than 5 employees. Only about 74 firms have over 100 employees.
- The largest states for land subdivision are Texas, California, and Florida.
Industry Forecast
Land Subdivision Industry Growth
Recent Developments
Mar 7, 2025 - Single-Family-Built-for-Rent Starts Drop
- High costs for financing reduced the development of single-family built-for-rent (SFBFR) construction activity in the fourth quarter of 2024 compared to a year earlier, according to National Association of Home Builders analysis of US Census Bureau data. In Q4 2024, there were about 15,000 SFBFR housing starts, down 38% from Q4 2023. However, during the four most recent quarters, 83,000 SFBFR homes began construction, which is up 8% compared to how many were built in the previous four-quarter period. While the historical four-quarter moving average market share for SFBFR is about 2.7% (1992-2012), SFBFR’s current share of the overall single-family market is about 8%. Single-family built-for-rent homes provide an alternative for consumers who want more space but are challenged by a lack of affordable housing inventory and downpayment requirements in the for-sale market.
- Single-family housing starts declined by 8.4% month-over-month and fell 1.8% year-over-year in January. The number of building permits issued for single-family, privately-owned housing units was flat month-over-month and dropped 3.4% compared to January 2024. Single-family housing completions were up 7.6% month-over-month and gained 9.8% year-over-year in January. Frigid January temperatures in much of the country slowed housing starts, according to reporting by Reuters. While a lack of existing homes on the market is helping to drive demand for new homes, some industry insiders are worried the Trump administration’s tariff-based trade agenda could increase builder costs when high mortgage rates and home prices have reduced affordability.
- Raids by Immigration and Customs Enforcement (ICE) are prompting some foreign-born workers to stay home from their workplaces, disrupting key industries that rely on migrant workforces, including construction, according to The Wall Street Journal. The Trump administration has said that while it is focusing on undocumented people with criminal backgrounds, anyone in the country illegally faces increased risk. According to an analysis of US Census Bureau data by the American Immigration Council, undocumented immigrants make up about 14% of the US construction sector’s workforce. The Associated General Contractors of America said it had received anecdotal reports of rising absenteeism from member firms in several locations, including Florida, Georgia, Oklahoma, and Texas. Labor disruptions reduce construction firms’ ability to deliver projects on time.
- Multifamily developers’ confidence was mixed in the third quarter of 2024, according to the National Association of Home Builders (NAHB) latest Multifamily Market Survey. The Multifamily Production Index (MPI) rose two points in Q3 2024 to 40 compared to the third quarter of 2023. The Multifamily Occupancy Index decreased by seven points to 75 over the same period. An MPI or MOI reading of 50 or more indicates that multifamily production or occupancy, respectively, is growing. Multifamily developers’ headwinds include a tight lending environment, higher borrowing costs, regulations, and land availability. The NAHB forecasts that multifamily construction activity will remain weak for about another year amid a significant volume of projects under construction. Multifamily construction is expected to return to more robust growth near the end of 2025.
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