Guest post by: Mark Boyle
Being a property developer can be an extremely thrilling and rewarding job when you know what is required to achieve a successful project. First and foremost, it’s a unique opportunity to take something from scrap, whether a new build or a re-development and turn it into something you’ve always dreamed of. As a property developer, you will have an incredible influence on the project and will undoubtedly be able to leave your mark on what will become the finished project. Of course, there’s also the financial incentives of being a developer. The funding you receive for large-scale construction projects can lead to massive gains, while re-developing a property that you’ve bought for cheap can make a quick return.
But while this is an exciting role with several benefits, it is challenging and requires specialist knowledge and skills. No one wants to see their dreams stall because of poor planning or to see their funds go down the drain.
Intelligent Scaffolding, a scaffolding firm in Liverpool, have years of experience working on a wide range of construction projects. They have worked with some of the North West’s biggest property development companies by providing essential construction support to help the developer’s dreams turn into reality.
In this article, Intelligent will walk us through some of the important factors that property developers should consider, right from the moment they start seeking a new project all the way through to its completion.
The Role of a Property Developer
Before you set off on the path of being a property developer, it’s important to know exactly what is required of you as per your job role. If you don’t know your responsibilities, it may be that you end up taking on too much work for yourself or treading on someone else’s work. Not to mention several projects have failed because of poor planning as a result of the developer not taking responsibility for their own tasks.
As a property developer, you are considered to be the leader of the entire project. All the integral pieces, from finding a property opportunity to constructing it, are controlled by you. This includes putting together a team and building partnerships that will help the project succeed.
The very first step that you should look to complete is research. You want to be well aware of current market trends, including economic factors and supply and demand. This will also involve finding the right property for you by scouring the land for purchase opportunities. The location, type of scheme, and projected costs and returns, are just a few points to keep in mind. With a property lined up, then starts the process of working with external parties to secure funding and planning permissions. Finally, you can then begin the work of overseeing the construction of the property.
Key Considerations During the Process 
So now that you know a bit more about the role itself, it’s time to dive further into the process that a property developer undertakes. The next few sections of this article will highlight factors to consider before and during construction work.
Price Growth
When searching for a property, it’s important that you conduct thorough research on various aspects before making a decision. One of the first questions that you should ask yourself is whether there is price growth in the area. For property developers and investors alike, price growth is a significantly attractive indicator of whether or not the site is a viable location for the property. If house prices are on the rise, then there signifies that there is a strong demand for new properties in the area.
Type of Scheme
When choosing a property or site, you will have to decide what type of scheme to develop, such as a new build scheme or a redevelopment project. Each of these will come with its own benefits, drawbacks and challenges. New build schemes are larger in scale and will typically be more expensive to develop, but in the long run, can generate higher returns. Redevelopment projects, on the other hand, will usually be cheaper to purchase and develop but offer smaller, quicker returns. New builds may provide greater flexibility over what you can do on the land, while redevelopments will likely be more restrictive in terms of planning permissions and the existing aesthetic of the property.
Local Amenities
Throughout your planning preparation, there’s an important line to remember: ‘where there is supply, there will be demand’. An opportunity will only exist, and only prove worthy, if there will be demand. No tenants will result in no investors and no homeowners will result in no homeowner buyers. When choosing the property, consider how well the local area is served with amenities, transport links and education. This may also shape who you target the property towards. For example, if there isn't a strong educational offering available nearby, then the development may be better suited to smaller apartments for young professionals or couples.
Funding Options
Before the pieces are in place to allow construction to commence, you need to carefully consider the funding options available to you. After all, you’re not going to be paying for the development with your own savings. One potential source of funding is through bridging finance which can be quite expensive, but development finance works well with a 75% loan to value at the top end of the scales.
Construction
The construction phase is an exciting part of the process as this is where you get to see your property idea come to life! That said, this is the stage that counts and you must get it right. The majority of the success of the project will fall on the build stage. This requires appointing building contractors that are well established and boast a strong reputation. The construction process is complex and includes things like bricklaying, scaffolding, plumbing, roofing, and much more. Those working on the scheme should specialise in their area and know how to achieve high-quality results, all while following industry standards, correct procedures and safety laws.
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The Property Voice - Insight from Richard Brown
Development, whether with 'D' or a 'd' is considered by many in property circles to be the pinnacle. There are so many potential opportunities to create and be rewarded for doing so. Mark makes the point well, that as leaders of the development project, developers need to have the vision, responsibility and staying power to see it through from start to finish. That's no mean feat when you think about it, as it means having a general or even specialist understanding of many different elements. However, I consider development to be very much a 'team sport'. The most successful developers might specialise in one or two elements, such as site finding, planning, raising finance, construction knowledge, sales/rentals and so on. But to get the best results, we need a team of experienced, capable and professional people, contractors and service providers around us.
This has been the single biggest piece of learning for me as a developer...bringing in the right team. We then need to engage, direct and manage this team in an effective way. Again, learning from experience, there are 'horses for courses' when it comes to selecting the right contractors and professional team AND then contracting with them in the most appropriate way.
I guess a key piece of advice is a reminder of a key phrase that has helped to keep me safe; trust but verify. If you carefully select the right people, contractors and professionals, they should be very capable of undertaking the task at hand...that's the trust part. However, we need to document, direct, inspect, cross-check, validate and course-correct everything along the way...that's the verify part. As developers, ultimately we get the highest rewards for any development project going well. We also take on the greatest risk and consequences should it not go so well.
With a diligent, professional and step-by-step approach, development is one of the most rewarding elements of participating in the property sector. Done properly, we make a significant positive contribution to society that leaves a legacy that will literally stand for a hundred years or more...and we will then be rewarded on several levels in doing so!