AZ real estate development is an exciting, challenging and multifaceted business suited for anyone who enjoys having their creativity, persuasiveness and perseverance tested at the highest levels.
It includes activities that run the gamut from the purchase of raw land to the sale of improved land (or parcels of land). Also, of course, demolition, upgrading and renovation. Although many real estate developers are also contractors, it is important to be aware that real estate development is different from construction.
The Role of a Real Estate Developer
‘Developing’ is the key word as pointed out by developer Louis Lesser in a 1963 New York Times’ article. Lesser developed over 60, 000 properties in the western United States.
As the name suggests, a real estate developer is responsible for developing properties for sale or rental purposes. The developer does not necessarily participate in the construction of the property; he purchases the land and appoints trained contractors to build the property.
Fundamentally, commercial real estate developers bridge the gap between builders and owners/tenants They are generally thought of as intermediaries between the construction companies that construct the buildings and the companies that utilize them.
Quite often, real estate developers are also property managers, as they keep operations running efficiently by maintaining the facilities, leaving their tenants free to focus on increasing profits. The real estate developer plays a crucial role in controlling preventable expenses and improving efficiency and effectiveness for all parties involved.
The best real estate developers may be described as visionaries. They are able to look years into the future to determine what buildings will be required and where to satisfy the needs of businesses and consumers of tomorrow. They picture a commercial building, an industrial park even an entire commercial district in what is currently an undeveloped area.
Do You Have What It Takes?
Commercial real estate development calls for significant financial investment and a firm understanding of tenants’ needs. Equally important is a knowledge of zoning laws and project management.
Additionally, good interpersonal and diplomacy skills are a key requirement, because developing commercial real estate necessitates negotiations with local authorities and representatives of both local residents and business owners. Also to be dealt with, are the contractors, such as those who perform the landscaping, architectural designs and construction work.
Some notable developers include John Raskob and Al Smith, real estate developers for the Empire State Building; Walt Disney, real estate developer for the new theme park concept; Victor Gruen, architect and father of the modern shopping mall; and Junior Rockefeller of New York City’s Rockefeller Center.
For entrepreneurs who have the requisite resources and skills, the development of commercial real estate is an extremely satisfying and worthwhile business opportunity. With sound planning and carefully thought out strategy, it can pave the way to a long and lucrative career.
Developers receive the greatest rewards because they take the greatest risks in the creation or renovation of real estate.