Real estate development is a multifaceted business that can be quite lucrative, encompassing activities that range from building renovations to the purchase of raw land and the sale of land to others. Many students are interested in real estate development, mostly asking the same question: “How can I become a developer?” Based on years of study and experience, here are four traits that all real estate developers must have.
Taking risks is more difficult for some people than others. Risk is a key part of development and students who are interested in this business should consider whether they would be able to rest at night knowing that their entire career or net worth was riding on the failure or success of a project. Wise developers take risks that are calculated and measured, constantly seeking ways to alleviate risk. Nevertheless, real estate development is a risky business that some are just not built for.
It takes tremendous skill to develop a successful project, requiring navigation through all the roadblocks and speed bumps along the way. Successful developers know how to solve problems and deal with pressure, understanding that there is usually more than one solution to a problem. Examples of problems and scenarios include dealing with adjacent land owners, zoning issues, creative site planning, and finding ways to stay on time and within budget. All of these are examples of the kinds of skills a developer must have in problem solving.
When it comes to real estate development, every project starts with an idea. This idea is either for a particular use on a site or for what may be needed in a community. Developers are creative, forward-thinking individuals who always look ahead to what demand might exist in the future. A successful developer pushes the envelope with exciting designs, cutting-edge methods of construction, and new building materials. This kind of creativity is what has birthed skyscrapers, shopping centers, and all the places we now use for home and work.
In the business of real estate development, relationships are an absolute must. These relationships take time to develop, which is a concept that should be familiar anyway. A developer must have relationships with architects, bankers, tenants, attorneys, general contractors, appraisers, and others. A developer can be seen like a movie producer; someone who brings a solid team together for the creation of a successful project.
Roman Temkin is a real estate developer who hails from NYC.