The early stages of locating a legal property to the satisfaction that comes with signing tenants, the real estate development process is crammed with meticulous, deadline-driven work involving many people. Often spanning several years, development teams have to aim for and monitor several benchmarks; missing even one might postpone completion.
A NAR poll found that 50% of commercial members said projects were delayed because of materials and permissions, 32% owing to hiring people, and 18% due to problems securing lender financing–all of which can be reduced with appropriate control. The phases of real estate development will be discussed in this post together with ideas on how development teams use technology to operate in a more targeted, scalable way.
The 3 Stages in the Real Estate Development process
Three Stages Within the Real Estate Development Process The real estate development process consists essentially in three phases: pre-development, building, and operation. More complicated projects could have further phases connected to certain issues developers have to address depending on their objectives, location, and other factors. Some companies might divide these phases into several phases or label them using other terms. Projects built to fit with specific, lease-ready tenants are simpler and carry less risk.
1. Pre-Development: Land Purchasing, Project Planning & Legal Approval
The initial phase of real estate development is where teams finish administrative and analytical tasks necessary to start construction. Usually, this process entails major correspondence with third parties, so tracking actions becomes even more crucial.
These are a few actions possible during the pre-development phase: Analyzing a property, financing of property development and its market helps one ascertain the best and highest utilization.
• Conducting viability analyses
• Both hard and soft cost budgeting
• Getting environmental reports and polling people
• Purchasing the land and including due diligence processes and land acquisition execution Getting building licenses and land use permission usually ready to enter the next step, construction, once the building permit is obtained.
2. Construction Phase: Dirt Shovels
The next phase of the real estate development process is building; all pertinent permits are in hand. Development teams have to cooperate with a building company carefully monitor the advancement of every step throughout this one.
Developers start promoting the building to possible tenants at the same time, hopefully landing a pre-lease agreement. Getting the certificate of occupancy, which communities give, marks the last stage in the building process that which guarantees compliance with all rules.
Development teams or legal team might document the several processes necessary to attain this milestone in a spreadsheet, therefore preventing expensive delays or a disorderly approach. It can be difficult to quickly find which chores have been finished and which still need to be done when this data is scattered among systems.
3. Monetizing the Land
After Completing the building stage of the real estate development process marks the last stage: property monetizing.
Some developers might find this means leasing it to tenants, then holding, and making money.
For others using various approaches, it could mean leasing the property to renters or developers then selling it to a buyer. Still, the objective throughout the operations phase is to create income in line with your investment plan.
Ways to Scale the Development Process
Real Estate Development Process Scale organizing every single moving component in the real estate development process is not easy work.
Teams often repeat efforts tracking how projects are moving from one stage to the next stage when data is scattered throughout systems, spreadsheets, and email inboxes. By using purpose-built real estate development software, one may, nevertheless, provide the process transparency, predictability, and organization.
Below is a list of some of the methods that managing development teams standardize the process to simplify daily tasks, so preserving real-time project visibility.
1. Use standardized commercial real estate development process checklists.
Working with Saffron City Developers, we maintain real-time visibility into ongoing projects. Work from Checklists for Standardized Commercial Real Estate Development Manual work can interfere with deal execution when development teams design checklists outlining the whole extent of new initiatives.
Our teams using automation tools build by saffron city to create commercial real estate development process checklists that lay out this process for them instead of spending time aggregating all of the tasks involved in pre-development, construction, and operations. Choose a platform that can automatically pop tasks depending on the transaction type, asset kind, location, and other factors since these factors usually affect the project requirements. Using consistent development checklists guarantees that as projects progress no crucial activities go unnoticed.
2- Track Project Activities and Dates Real Time Data
Based on current developments, how can one ascertain when some benchmarks will be reached?
Relying on a project management platform that manages past, present, and overdue activities is crucial as you extend the real estate development process to accept additional projects. While certain milestones depend on others, dynamic dependencies guarantee that project schedules will change with time.
Saffron City and other cloud-based deal management systems let team members enter modifications as they happen, therefore providing real-time access to see how projects are developing. Executives can thus make important judgments regarding how to more effectively manage resources, re-assign jobs, and predict outcomes and more.
3. Simplify Working with Outside Partners
Your staff will be looking and gathering data from several third-parties while the real estate development process rolls on, including:
• Legal groups
• Environmental analysts
•Development Tools
Working on building projects Real estate development tools can help your team by letting outside partners send deliverables and update data straight, without involving your staff, therefore relieving some of their workload. This lowers human mistake risk and allows your staff more time to focus on important projects. Make sure you clarify that although they just examine limited information that won’t jeopardize your approach.
4. Simplify Notes of Reporting
Maintaining stakeholders in the loop and spotting obstacles depend on reporting about milestone progress for ongoing development projects, but typically comes at great cost to the time of your team. Most teams have to first contact third parties, go over spreadsheets, and confirm that all data is accurate before boldly offering updates.
This isn’t scalable for development teams running important projects to complete. Reporting can be much simplified by depending on a technology such as a deal management system that records this real-time data.
Saffron City lets developers create reports based on assignment filters and forthcoming crucial dates. Without draining their teams, developers can create a real-time picture of project development with just two clicks.
Why saffron city to Scale the Real Estate Development Process Matters to Developers Leading commercial real estate Development Company using L + M Development Partners, which operates from idea to completion, depends on saffron city to build an always-on repeatable process that increases predictability and efficiency.