Developing real estate is a challenging task. It’s never linear and, as per Murphy’s Law, anything that can go wrong will – and frequently does.
To ensure the success of a project, real estate developers work with a myriad of professionals. These include engineers, architects, surveyors, and lawyers. They also collaborate with lenders and investors to secure financing.
The pre-development phase is everything that happens before a real estate project even breaks ground. It is where most of the project planning takes place – including feasibility studies and site selection.
During this time, the team of professionals involved in the development process is assembled. It includes landscape architects and civil engineers to address site design; market consultants to assess demand and a project’s economics; attorneys to handle agreements and government approvals; soils engineers to determine a site’s physical limitations and environmental impacts; surveyors to provide legal descriptions of property; and financial institutions to arrange to finance.
Local jurisdictions are well aware of the costs associated with this stage and often implement ways to help community-driven developers like Your Home Wichita offset some of these costs. They also recognize that developing their cities is a great way to promote prosperity for residents. They work hard to support developers in the pre-development and construction phases.
Depending on the type of project, construction may involve building new residential or commercial facilities. Real estate developers handle these projects from the beginning, obtaining financing and public approvals like zoning laws to the completion and management of the new property.
The developer will have business tenants lined up for larger CRE projects before construction begins. It reduces overall risk for investors and makes the investment more valuable when the project is completed.
Many distinct professional specialties are needed for the development process. These include architects and engineers to design the facility; market consultants to analyze demand and economics; land use experts to interact with local government on approvals; soils engineers and environmental consultants; title companies to provide legal property descriptions; and lenders to finance the project.
The construction phase is a highly volatile time for real estate development, and many potential risks must be addressed. Investors need to understand the complete life cycle of a project before investing in it.
As with the pre-development and construction phases, the post-development step involves a variety of professionals. Real estate developers will address land use considerations with landscape architects, civil engineers, and site planners. These experts will ensure the project is done under all relevant local, state, and federal laws and regulations.
While many critics of development initiatives point to material failures, few give as much attention to the nonmaterial aspects of these failures as post-development theorists. They emphasize that development is a way of seeing the world, an ideology, and a mindset.
They also emphasize that there is no one model of development to follow. Instead, they call for a new approach to development that recognizes the diversity of cultural perspectives and priorities. They also argue that modernization theory is ethnocentric and seeks to impose a Western agenda on developing countries.
Real estate developers may work directly with clients to develop and market their vision, or they might handle the marketing for the project they imagine and then sell it. Because these projects are expensive and any missteps can have costly results, they must be carefully managed by a skilled professional. It involves a lot of communication with team members, city officials, contractors, and potential buyers to satisfy everyone.
Outsiders might think that real estate development is a glamorous career, but it’s hard work with many risks. The good news is that real estate development teams can improve their operations’ structure and predictability by using the appropriate technologies. For instance, purpose-built real estate software can streamline day-to-day work and provide real-time visibility into project milestones. It can also help manage dependencies and create reports for all involved parties. Relationship building is essential in this industry, especially now that being face-to-face with potential investors has become more challenging during the COVID-19 pandemic.