Ask people what a commercial real estate developer does and you’re likely to get a different answer from all of them. The fact is, being a real estate developer is a complex blend of architecture, finance, managing, engineering, hand-shaking and more. There’s no straight shot to becoming a real estate developer, but we’ll highlight some of the characteristics it takes to succeed as one.
Education:
There are many, many routes to becoming a commercial real estate developer. Some risk-taking entrepreneurs eventually stumble into the job through long hours of hard work and a dash of luck. Most developers though attend college and study the foundations of developing buildings.
Commercial real estate development is a vast field that requires a working understanding of many different areas. Those considering it as a career could travel a number of education avenues to reach their destination. Four year degrees in studies like Civil Engineering, Architecture, Urban Planning, or Business Real Estate would all provide you with a handle on some stage of the development cycle.
Whether you’re an entrepreneur or a student, getting hands-on and dirty with development projects is the surest way to learn.
Relationship Building:
Here is an incomplete list of people you will have to interact with if you become a real estate developer: lenders, lawyers, tenants, investors, general contractors, civil engineers, architects, brokers, and more! All of these will require that you spend time cultivating relationships with them. The stronger your ties and the more trust you create, the likelier you and your projects are to succeed.
Risk Tolerance
Commercial real estate development is an inherently risky job. There’s no guarantee your investment will pay off and the majority of the risk falls on you and your investors’ heads. But with big gambles can come big rewards. To excel as a developer is to understand the bets worth taking and the ones that should be left on the table.
Problem-Solving
Developing commercial real estate is a gigantic machine with lots of individually moving parts—meaning there’s plenty of..creative..ways for something to go wrong. As the developer, you’ll have to be ready for both the expected and the unexpected. When an event eventually occurs that blindsides you, you’ll have to be quick enough on your feet to mitigate any damage.
Curiosity
A successful developer is one who can ask the right “Whys?”. Research your local market until you understand which sectors affect each other. With enough knowledge, you’ll begin to notice patterns and trends before your competitors. This type of understanding can lead to better decision making and planning for the future—like preparing for a buyer’s market when you recognize the signals for one.