Real estate developer
You may be wondering whether you have, or can acquire, the skills of a real estate developer. It is true that good developers must multi-task without letting go of the overall project goal. Developing property with any degree of success relies on interacting well with key players. The steps taken by a typical developer involve working through regulatory channels, the political arena, and gaining neighborhood approval.
It requires good negotiating skill and luck. Self knowledge and creativity are both keys to the success of a real estate development project. In addition, there are many steps from the conception of the project to the final stages that involve contracts with myriad of people, including buyers, sellers, lenders, contractors, and architects so that people skills are high on the list of requirements.
A real estate developer can loosely be defined as a person, partnership, or other entity who has an idea for development and subsequently gathers the seed capital to begin the project, purchases a piece of land or a building, and creates the necessary steps for the project to make a profit. As you delve into your first few projects, you may find that you possess a talent for one part or another. You might begin to specialize in a particular area, or you may search for partners to round out the total process with you.
A real estate developer can also be defined as someone who purchases an existing property and renovates it or revamps it for a different use. Often these are properties use has become obsolete through changes in the market, changes in the neighborhood, or simply due to lack of maintenance and updates. Some areas of the country have a tremendous amount of property revitalization. The fact is that the majority of owners as well as tenants have no idea what a property could look like with renovation or cosmetic upgrades. If you are able to visualize updates to an existing property and you can keep the project cost effective, you may be able to put your ideas into action.
Real estate development projects are unalike because there are so many niches, such as developing raw land or renovating existing buildings. You may have a property in mind where you want to build posh upscale homes, or you may want to create a minimalist office building from the ground up. You may choose to sell your improved parcels to others, or lease and manage them yourself, or put any other combination of all the above ideas into play. With development, you can invent your own job from an array of endless possibilities.
Whether real estate developers are interested in land, multifamily residential, office, industrial, or retail development, or mixed use properties, there are always numerous opportunities. Most developers choose to specialize in a particular segment of these general areas ; for instance, building strip malls will differ somewhat from building regional malls.
Real estate developers you know may differ widely in their skills, their ego, and the level of visibility that they prefer. Developers may choose to concentrate on one type of property or several. They may work in a small niche, regionally or nationally. One who has skills in construction may choose to act as genera contractor as well, and another whose background is in finance may choose to hire out the portion of their project. Some choose to work alone, and some choose to work in partnership with others. All developers have a few things in common, though: they must have access to land and capital, and they have, or develop, skills for management and entrepreneurship.
A real estate developer is someone who is very active in the process. People who invest but do not participate are investors; people who find tenants or buyers and receive a commission are brokers. Development is different from investment due to the degree of ownership. It is different from being a broker because of the personal risk involved. In developing, you have total control, yet no control at all ; you risk everything, and you may gain more than would ever be possible in any of the other connected roles; and perhaps more than any other career, you rely a great deal on instinct.
There are certain things that will be required. For instance, a real estate developer needs to be able to meet a schedule, complete the job correctly, and remain reasonably close to the proposed budget.
Thus, a good real estate developer will realize that the public is his or her partner. Treating the public with respect will prevent a multitude of unnecessary problems. In other fields entrepreneurs merely obtain a local business license or a sales tax number, and their career is on the way. The developer has to present the product over and over, exposing it to an overwhelming array of local regulations and political and community approval processes. Consulting with local government, becoming involved with the public and listening to their concerns is all part of a good working relationship with the community. A developer must understand urban dynamics, even if he or she is just starting out.
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