Interested in Property Development?

Developing new buildings or value adding to existing buildings can be very lucrative. However, where there is great potential for opportunity there is also equal opportunity for loss. This is a specialist area where substantial market and project management knowledge is required.

The bottom line is that property development is a very complex, multifaceted assignment, requiring all manner of input from a wide range of professionals, and specialist consultants including architectural, engineering, town planning, legal, surveying, accounting, finance, marketing and sales; construction, with its myriad skilled trades; administration and unskilled labour; copious material suppliers etc. Property development is about the successful management of people and the ability to put together a quality, cohesive team with the financial capacity to complete its assignment.

The developer has to understand the market and what is required for a given location. Their job, is to co-ordinate all of the above activities and bring the project to a successful conclusion. There are three main areas of risk as follows:

• The development risk.
• The construction risk.
• The sales and marketing risk.

All are critical and need to be equally considered and addressed.

One trap developers face is that a single house is as difficult to build as it is to develop a larger-unit or townhouse development project. All the same team members require coordination, the right site must still be found, and the project built for the right price and sold at a profit. Trouble begins when developers realise this, and then prematurely take on larger projects before they can actually afford the larger holding costs over an extended project timeline.