Real estate development

Process that creates or renovates new or existing spaces

Not to be confused with Real estate investing.

The Solidere development of the Beirut seafront and harbor In the Netherlands, virtually all housing is developed and built through property developers, including development in upmarket segments. Advertisement for mobile homes on the Florida Keys, June 1973

Real estate development, or property development, is a business process, encompassing activities that range from the renovation and re-lease of existing buildings to the purchase of raw land and the sale of developed land or parcels to others. Real estate developers are the people and companies who coordinate all of these activities, converting ideas from paper to real property.[1] Real estate development is different from construction or housebuilding, although many developers also manage the construction process or engage in housebuilding.

Developers buy land, finance real estate deals, build or have builders build projects, develop projects in joint ventures, and create, imagine, control, and orchestrate the process of development from beginning to end.[2] Developers usually take the greatest risk in the creation or renovation of real estate and receive the greatest rewards. Typically, developers purchase a tract of land, determine the marketing of the property, develop the building program and design, obtain the necessary public approval and financing, build the structures, and rent out, manage, and ultimately sell it.[1]

Sometimes property developers will only undertake part of the process. For example, some developers source a property and get the plans and permits approved before selling the property with the plans and permits to a builder at a premium price. Alternatively, a developer who is also a builder may purchase a property with the plans and permits in place so that they do not have the risk of failing to obtain planning approval and can start construction on the development immediately. The financial risks of real estate development and real estate investing differ due to leverage effects.[3]

Supply and demand curves with economic equilibrium of price and quantity apply to real estate development

Developers work with many different counterparts along each step of this process, including architects, city planners, engineers, surveyors, inspectors, contractors, lawyers, leasing agents, etc. In the Town and Country Planning context in the United Kingdom, 'development' is defined in the Town and Country Planning Act 1990 s55.

## Organizing for development

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A development team can be put together in one of several ways. At one extreme, a large company might include many services, from architecture to engineering. At the other end of the spectrum, a development company might consist of one principal and a few staff who hire or contract with other companies and professionals for each service as needed.

Assembling a team of professionals to address the environmental, economic, private, physical and political issues inherent in a complex development project is critical. A developer's success depends on the ability to coordinate and lead the completion of a series of interrelated activities efficiently and at the appropriate time.[4]

Development process requires skills of many professionals: architects, landscape architects, civil engineers and site planners to address project design; market consultants to determine demand and a project's economics; attorneys to handle agreements and government approvals; environmental consultants and soils engineers to analyze a site's physical limitations and environmental impacts; surveyors and title companies to provide legal descriptions of a property; and lenders to provide financing. The general contractor of the project hires subcontractors to put the architectural plans into action.

## Land development

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Further information: Land development

Purchasing unused land for a potential development is sometimes called speculative development.

Subdivision of land is the principal mechanism by which communities are developed. Technically, subdivision describes the legal and physical steps a developer must take to convert raw land into developed land. Subdivision is a vital part of a community's growth, determining its appearance, the mix of its land uses, and its infrastructure, including roads, drainage systems, water, sewerage, and public utilities.

Land development can pose the most risk, but can also be the most profitable technique as it is dependent on the public sector for approvals and infrastructure and because it involves a long investment period with no positive cash flow.

After subdivision is complete, the developer usually markets the land to a home builder or other end user, for such uses as a warehouse or shopping center. In any case, use of spatial intelligence tools mitigate the risk of these developers by modeling the population trends and demographic make-up of the sort of customers a home builder or retailer would like to have surrounding their new development.[5]

## See also

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* Brownfield regulation and development
* Land consumption
* NIMBY
* Real estate business
* Shared ranch
* Urban sprawl
* YIMBY movement

## References

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1. ^ a b Frej, Anne B; Peiser, Richard B. (2003). Professional Real Estate Development: The ULI Guide to the Business (2 ed.). Urban Land Institute. p. 3. ISBN 0874208947. OCLC 778267123.
2. ^ New York Times, March 16, 1963, "Personality Boom is Loud for Louis Lesser"
3. ^ Geltner, David, Anil Kumar, and Alex M. Van de Minne. "Riskiness of real estate development: A perspective from urban economics and option value theory." Real Estate Economics 48.2 (2020): 406-445.
4. ^ "Article: What does a property developer do? Sept 2019". Archived from the original on 2020-08-08. Retrieved 2020-04-15.
5. ^ "What is a Lady Bird Deed". April 18, 2020. Archived from the original on 2020-09-27. Retrieved 2020-04-18.

## External links

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* Media related to Real estate development at Wikimedia Commons

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Real estate developments

Commercial|

* Airport
* Business park
* Bus station
* Commercial area
* Mixed-use development
* Office building
* Port
* inland
* Power center
* Retail park
* Riverfront
* Shopping center (Shopping mall)
* Train station
* Shopping streets and districts

Industrial|

* Business cluster
* Industrial district
* Industrial park
* Technology centers

Residential|

* Agrihood
* Boarding house
* Bungalow court
* City block
* Closed community
* Company town
* Conservation community
* Executive home
* Golf course community
* Gated community
* Housing estate
* Intentional community
* Luxury apartment
* McMansion
* Mixed-use development
* Model dwellings for the poor
* Multifamily residential
* Penthouse apartment
* Private community
* Public housing
* Residential airpark
* Residential area
* Retirement community
* Revenue house
* Rooming house
* Single-room occupancy
* Subdivision
* Tract housing

| Disability|

* Assisted Living
* Behavior modification facility
* Residential treatment center
* Therapeutic boarding school

|

Elderly care|

* Age-restricted community
* Nursing home
* Retirement Home
* Senior Living

Science/education|

* Akademgorodok
* Atomgrad
* Campus
* Research park
* Satellite campus
* Science park

Municipal|

* Arcology
* Civic center
* Garden city movement
* Model village
* Planned cities
* Planned community
* Urban green space
* parks

Buildings (types)|

* Apartment
* House
* types
* Skyscraper
* Tower block
* Villa

Miscellaneous|

* Brownfield land
* Cemetery
* Residential cluster development
* Construction
* Context theory
* Eminent domain
* Greenfield land
* Greyfield land
* Groundscraper
* Land-use planning
* Nonbuilding
* NIMBY
* Park
* Parking (Multistorey car park)
* Planning permission
* Playground
* Redevelopment
* Regional planning
* Urban design
* Urban planning
* YIMBY
* Zoning

Housing portal

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Real estate

* Property
* Tertiary sector of the economy

By location|

* Bangladesh
* Canada
* China
* Indonesia
* Italy
* Turkey
* Kenya
* Pakistan
* Panama
* Puerto Rico
* Russia
* Saudi Arabia
* United Arab Emirates
* United Kingdom

Types|

* Commercial property
* Commercial building
* Corporate Real Estate
* Extraterrestrial real estate
* International real estate
* Lease administration
* Niche real estate
* Garden real estate
* Healthcare real estate
* Vacation property
* Arable land
* Golf property
* Luxury real estate
* Off-plan property
* Private equity real estate
* Real estate owned
* Residential property

Sectors|

* Property management
* Real estate development
* Real estate investing
* Real estate flipping
* Relocation

Law and regulation|

* Adverse possession
* Chain of title
* Closing
* Concurrent estate
* Conditional sale
* Conveyancing
* Deed
* Eminent domain
* Encumbrance
* Foreclosure
* Just cause eviction
* Land law
* Land registration
* Leasehold estate
* Lease
* Property abstract
* Real estate transaction
* Real estate contract
* Real property
* Rent regulation
* Severance
* Torrens title
* Zoning

Economics, financing
and valuation|

* Asset-based lending
* Capitalization rate
* Effective gross income
* Gross rent multiplier
* Hard money loan
* Highest and best use
* Home equity loan
* Investment rating for real estate
* Mortgage insurance
* Mortgage loan
* Real estate derivative
* Real estate economics
* Real estate bubble
* Real estate valuation
* Remortgage
* Rental value

Parties|

* Appraiser
* Buyer agent
* Buyer broker
* Chartered Surveyor
* Exclusive buyer agent
* Land banking
* Landlord
* Moving company
* Property manager
* Real estate broker
* Real estate investment club
* Real estate investment trust
* Real property administrator
* Tenant

Other|

* Companies
* Eviction
* Filtering
* Gentrification
* Graduate real estate education
* Green belt
* Indices
* Industry trade groups
* Investment firms
* Land banking
* People
* Property cycle
* Real estate trends
* Undergraduate real estate programs
* Urban decay
* Urban planning
* List of housing markets by real estate prices

* Category
* Commons
* List of topics

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Land use

General|

* Degradation
* Development/Conversion
* Planning
* Conflict
* Land management
* Landscaping
* Integrated landscape management
* Land grabbing
* Land consumption
* Land loss
* Habitat destruction
* Illegal construction
* Land reclamation
* Land rehabilitation
* Landscape ecology
* Rangeland management
* Environmental planning
* Leopold matrix
* Watertable control
* Developed environments
* Built-up area
* Locally unwanted land use

Property|

* Property
* Subdivision (land)
* Real estate development
* Land development bank
* Land (economics)
* Customary land

Related fields|

* Soil
* Soil science
* Soil compaction
* Soil contamination
* Alkali soil
* Pollution
* Deforestation
* Urban planning
* Agriculture
* Drainage system (agriculture)
* Land change modeling

* Categories: Land use

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Construction

Types|

* Home construction
* Offshore construction
* Underground construction
* Tunnel construction

History|

* Architecture
* Construction
* Structural engineering
* Timeline of architecture
* Water supply and sanitation

Professions|

* Architect
* Building engineer
* Building estimator
* Building officials
* Chartered Building Surveyor
* Civil engineer
* Civil estimator
* Clerk of works
* Project manager
* Quantity surveyor
* Site manager
* Structural engineer
* Superintendent

Trades workers
(List)|

* Banksman
* Boilermaker
* Bricklayer
* Carpenter
* Concrete finisher
* Construction foreman
* Construction worker
* Electrician
* Glazier
* Ironworker
* Millwright
* Plasterer
* Plumber
* Roofer
* Steel fixer
* Welder

Organizations|

* American Institute of Constructors (AIC)
* American Society of Civil Engineers (ASCE)
* Asbestos Testing and Consultancy Association (ATAC)
* Associated General Contractors of America (AGC)
* Association of Plumbing and Heating Contractors (APHC)
* Build UK
* Construction History Society
* Chartered Institution of Civil Engineering Surveyors (CICES)
* Chartered Institute of Plumbing and Heating Engineering (CIPHE)
* Civil Engineering Contractors Association (CECA)
* The Concrete Society
* Construction Management Association of America (CMAA)
* Construction Specifications Institute (CSI)
* FIDIC
* Home Builders Federation (HBF)
* Lighting Association
* National Association of Home Builders (NAHB)
* National Association of Women in Construction (NAWIC)
* National Fire Protection Association (NFPA)
* National Kitchen & Bath Association (NKBA)
* National Railroad Construction and Maintenance Association (NRC)
* National Tile Contractors Association (NTCA)
* Railway Tie Association (RTA)
* Royal Institution of Chartered Surveyors (RICS)
* Scottish Building Federation (SBF)
* Society of Construction Arbitrators

By country|

* India
* Iran
* Japan
* Romania
* Turkey
* United Kingdom
* United States

Regulation|

* Building code
* Construction law
* Site safety
* Zoning

Architecture|

* Style
* List
* Industrial architecture
* British
* Indigenous architecture
* Interior architecture
* Landscape architecture
* Vernacular architecture

Engineering|

* Architectural engineering
* Building services engineering
* Civil engineering
* Coastal engineering
* Construction engineering
* Structural engineering
* Earthquake engineering
* Environmental engineering
* Geotechnical engineering

Methods|

* List
* Earthbag construction
* Modern methods of construction
* Monocrete construction
* Slip forming

Other topics|

* Building material
* List of building materials
* Millwork
* Construction bidding
* Construction delay
* Construction equipment theft
* Construction loan
* Construction management
* Construction waste
* Demolition
* Design–build
* Design–bid–build
* DfMA
* Heavy equipment
* Interior design
* Lists of buildings and structures
* List of tallest buildings and structures
* Megaproject
* Megastructure
* Plasterwork
* Damp
* Proofing
* Parge coat
* Roughcast
* Harling
* Real estate development
* Stonemasonry
* Sustainability in construction
* Unfinished building
* Urban design
* Urban planning

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