THE BASICS:
Working with simple boxes a 100x100 and 20x20 polygons are converted to Civil 3D Parcel objects. As shown both rectangular parcels are hosted within the same site:
• Lot 1 = Area 10,000 (100x100)
• Lot 2 = Area 400 (20x20)
Objects within the same site interact with each other causing design elements to be changed. Note the areas for the larger lot was recalculated showing the subtraction, acting like AutoCAD hatch patterns and recognizing the geometry as an island.
• Lot 1 = Area 9,600 (100x100)
• Lot 2 = Area 400 (20x20)
This is exactly the behavior will be leveraging in this post for a subdivision design.
PRACTICAL APPLICATION:
Here the outer perimeter is used to create a boundary area in red (~51.94 AC), later internal line work will be used to calculate the internal areas. 
With the perimeter done, the internal linework is converted and a total of 170 parcels are created. Design is split into 3 categories:
• Right of Way: 1
• Open Area: 3
• Parcels: 166
In the end the starting Area ~51.94 AC was reduced ~11.31 AC because all the created parcels are hosted in the same site, even if they are "islands".
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