Changes
→Paths for entering the development field
{{more citations needed|date=September 2013}}
[[File:RasBeyrouth.jpg|thumb|245px|The [[Solidere]] development of the [[Beirut]] seafront and harbor]]
[[File:Netherlands, The Hague, Boekelermeerstraat.JPG|thumb|245px|In the [[Netherlands]], virtually all housing is developed and built through property developers, including development in upmarket segments.]]
'''Real estate development''', or '''property development''', is a [[business process]], encompassing activities that range from the [[renovation]] and re-[[lease]] of existing [[building]]s to the purchase of raw [[Real Estate|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]].<ref name="Frej, Anne B 2003. p. 3">Frej, Anne B & Peiser, Richard B. ''Professional Real Estate Development, Second Edition: The ULI Guide to the Business''. Urban Land Institute, 2003. p. 3.</ref> Real estate development is different from [[construction]], although many developers also manage the construction process.
Developers buy land, finance real estate deals, build or have builders build projects, create, imagine, control, and orchestrate the process of development from the beginning to end.<ref name=NYT16Mar63>New York Times, March 16, 1963, "Personality Boom is Loud for Louis Lesser"</ref> 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.<ref name="Frej, Anne B 2003. p. 3"/>
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 that 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.
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.
==Credentials==
Many aspects of the real estate development process require local or state licensing, such as acting as a real estate broker or sales agent along. A real estate developer is not a professional designation, there are no schools or associations who recognize or protect the term as a trademark. Some real estate developers, often those involved in marketing properties through traditional real estate channels, choose to join business associations such as [[SIOR]].<ref>{{Cite news|url=https://commercialobserver.com/2018/04/why-an-sior-designation-is-a-must-for-cre-professionals/|title=Why an SIOR Designation Is a Must for CRE Professionals|date=2018-04-16|work=Commercial Observer|access-date=2018-05-07|language=en-US}}</ref>
==Paths for entering the development field==
{{Main|Real estate development education}}
No single path automatically leads to success in real estate development. Developers come from a variety of disciplines— construction, urban planning, lending, architecture, law and accounting, among others. Recent specialized programs that award a [[Master of Real Estate Development]] (MRED) degree are also available. The graduate programs in real estate development are the most comprehensive education in the [[real estate industry]]. Other formal education includes a [[Master of Science in Real Estate]] (MSRE), or an [[MBA]].
==Organizing for development==
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.
Development process requires skills of many professionals: [[architect]]s, [[landscape architect]]s, [[civil engineer]]s and [[site planner]]s to address project design; [[market consultant]]s to determine demand and a project's economics; [[Lawyer|attorneys]] to handle agreements and [[government approval]]s; [[Environmental consulting|environmental consultant]]s and [[Geotechnical engineering|soils engineer]]s to analyze a site's physical limitations and [[Environmental impact assessment|environmental impacts]]; [[surveyor]]s and [[Title insurance|title]] companies to provide [[legal description]]s of a property; and [[lender]]s to provide financing. The [[general contractor]] of the project hires [[subcontractor]]s to put the [[architectural plan]]s into action.
==Land development==
{{Further|Land development}}
Purchasing unused land for a potential development is sometimes called '''[[speculation|speculative]] development'''.
[[Subdivision (land)|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 [[road]]s, [[drainage]] systems, [[water supply|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 (business method)|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.
== See also ==
* [[Construction]]
* [[Home construction]]
* [[Land consumption]]
* [[Land use]]
* [[Property investment calculator]]
* [[Redensification]]
* [[Urban sprawl]]
==References==
{{Reflist}}
{{Developments}}
{{Real estate}}
{{land use}}
{{DEFAULTSORT:Real Estate Development}}
[[Category:Real estate and property developers| ]]
[[Category:Architecture]]
[[Category:Construction]]
[[File:RasBeyrouth.jpg|thumb|245px|The [[Solidere]] development of the [[Beirut]] seafront and harbor]]
[[File:Netherlands, The Hague, Boekelermeerstraat.JPG|thumb|245px|In the [[Netherlands]], virtually all housing is developed and built through property developers, including development in upmarket segments.]]
'''Real estate development''', or '''property development''', is a [[business process]], encompassing activities that range from the [[renovation]] and re-[[lease]] of existing [[building]]s to the purchase of raw [[Real Estate|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]].<ref name="Frej, Anne B 2003. p. 3">Frej, Anne B & Peiser, Richard B. ''Professional Real Estate Development, Second Edition: The ULI Guide to the Business''. Urban Land Institute, 2003. p. 3.</ref> Real estate development is different from [[construction]], although many developers also manage the construction process.
Developers buy land, finance real estate deals, build or have builders build projects, create, imagine, control, and orchestrate the process of development from the beginning to end.<ref name=NYT16Mar63>New York Times, March 16, 1963, "Personality Boom is Loud for Louis Lesser"</ref> 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.<ref name="Frej, Anne B 2003. p. 3"/>
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 that 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.
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.
==Credentials==
Many aspects of the real estate development process require local or state licensing, such as acting as a real estate broker or sales agent along. A real estate developer is not a professional designation, there are no schools or associations who recognize or protect the term as a trademark. Some real estate developers, often those involved in marketing properties through traditional real estate channels, choose to join business associations such as [[SIOR]].<ref>{{Cite news|url=https://commercialobserver.com/2018/04/why-an-sior-designation-is-a-must-for-cre-professionals/|title=Why an SIOR Designation Is a Must for CRE Professionals|date=2018-04-16|work=Commercial Observer|access-date=2018-05-07|language=en-US}}</ref>
==Paths for entering the development field==
{{Main|Real estate development education}}
No single path automatically leads to success in real estate development. Developers come from a variety of disciplines— construction, urban planning, lending, architecture, law and accounting, among others. Recent specialized programs that award a [[Master of Real Estate Development]] (MRED) degree are also available. The graduate programs in real estate development are the most comprehensive education in the [[real estate industry]]. Other formal education includes a [[Master of Science in Real Estate]] (MSRE), or an [[MBA]].
==Organizing for development==
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.
Development process requires skills of many professionals: [[architect]]s, [[landscape architect]]s, [[civil engineer]]s and [[site planner]]s to address project design; [[market consultant]]s to determine demand and a project's economics; [[Lawyer|attorneys]] to handle agreements and [[government approval]]s; [[Environmental consulting|environmental consultant]]s and [[Geotechnical engineering|soils engineer]]s to analyze a site's physical limitations and [[Environmental impact assessment|environmental impacts]]; [[surveyor]]s and [[Title insurance|title]] companies to provide [[legal description]]s of a property; and [[lender]]s to provide financing. The [[general contractor]] of the project hires [[subcontractor]]s to put the [[architectural plan]]s into action.
==Land development==
{{Further|Land development}}
Purchasing unused land for a potential development is sometimes called '''[[speculation|speculative]] development'''.
[[Subdivision (land)|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 [[road]]s, [[drainage]] systems, [[water supply|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 (business method)|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.
== See also ==
* [[Construction]]
* [[Home construction]]
* [[Land consumption]]
* [[Land use]]
* [[Property investment calculator]]
* [[Redensification]]
* [[Urban sprawl]]
==References==
{{Reflist}}
{{Developments}}
{{Real estate}}
{{land use}}
{{DEFAULTSORT:Real Estate Development}}
[[Category:Real estate and property developers| ]]
[[Category:Architecture]]
[[Category:Construction]]
