The idea of building something like a factory or bulldozer rather than taking over control of an existing entity is one of several irritating changes in the new version, but I digress
I guess the rule book does say build, but I took that as another typo left over from IS. As is calling the drafting phase the lookout phase just after. Anyway, I've always considered the grey tokens as supplies needed to take over a location and developing as building something new on top of the old location. Works thematically to me, makes sense with the distance cost. I personally think it's what was meant and 'build' was just an unfortunate carry over from IS.