Who is that?
In simple terms, then the developer buys something and tries to improve and develop it as much as possible. All this is done with one goal – to sell more expensive. In construction, such activities are extremely common. The range of responsibilities is very wide:
- acquisition of land or an object, determination of its potential;
- market analysis for the effective use of the purchase;
- creating an initial plan for a future project;
- formation of the concept of the object and sketches of the project;
- obtaining all necessary documents to start construction;
- control of all stages of the implementation of the plan;
- marketing research;
- renting out an object;
- sale of a finished building or plot.
A professional in construction is also involved in solving all current financial issues. It is the specialist who must find investors, calculate all expenses and risks. The developer communicates with banks if it is necessary to take out a loan for construction. It is also necessary to coordinate the project in various instances.
The lack of specialists is due to the fact that a lot of knowledge is required in various fields. At the same time, the profession is well paid and quite in demand. The developer can be engaged in interesting projects, so the work is usually enjoyable. At the same time, there has been a recent crisis in the real estate market. This trend has a negative impact on developers.
The job itself comes with a lot of day-to-day stress. Mistakes in this work usually lead to large financial losses. And this means that experience in the profession is extremely important.
Differences from the developer
Misunderstanding of terms often leads to serious confusion. The developer is the owner of the project, the temporary owner of the object. As a result, the process can also be called a purchase for improvement and development. However, the developer is different from the builders. Developer – legal definition. According to the law, this is the person who is responsible. But developer is an economic term. This person is an entrepreneur. The difference is that the main task of the developer is to increase the value of the building or land.
It is important to understand that formally, it is the developer who is responsible for the quality of the final result. The developer himself attracts investors, provides advertising and is engaged in the final implementation. Rarely does such a specialist act as a developer, these are completely different areas of activity. Only large concerns or corporations can work in several directions at once. There are other forms of work in interregional markets. A large developer company may have several developers in the regions. In this case, the head office is responsible for information and advertising support. Small companies are directly involved in construction.
So, developers and builders may overlap. They always work together, but are responsible for different processes. In case of serious violations, it is the developer who will be responsible for the poor-quality construction.
However, the developer must ensure the correct design of the building and its implementation. He will also be liable if the latter does not bring the proper profit.
Varieties and responsibilities
The developer is engaged in increasing the value of the property. However, there are several branches of the profession. The difference lies in the ways of finding investors. We list the main types of developers.
- Speculative. The developer himself acts as an investor. For the implementation of the project, personal funds of a specialist or bank loans are used. In this case, the developer independently finances the selected project, organizes and supervises the construction work. At the end, the specialist is looking for buyers or tenants for the object. This type of activity is usually used in the construction of shopping and entertainment complexes. A speculative developer takes all the risks and ultimately receives all the profits.
- BTS development. This type of activity is quite simple, but interesting. The activity of a specialist is carried out directly for the customer. This reduces some of the risk. The developer will not have to look for a buyer after the project is ready. Loosely translated, this means “construction under the customer.” The scheme of work is very different from the previous version. The developer is approached by an investor with an order for the construction of a particular object. For example: an enterprise invests in the construction of a house for its workers. A development company in such a situation should have many different specialists or connections with them. So, you will have to deal with design and consultation, as well as the construction itself. In some cases, the investor already has a project, so the developer performs only the last two functions.
- Fee development. Such a concept means development for a reward. The type of activity implies a full development cycle, which is implemented with funds from investors. A person or a company can simply come to the developer and ask them to invest their funds at their discretion. In this case, the specialist must choose an option for investing in the construction or reconstruction of the facility so that the investor receives the maximum benefit. The developer himself receives a reward.
Development is divided not only by the method of attracting investors. A specialist can work with a certain type of real estate. It is worth noting that large companies usually occupy all niches.
- Country houses. Activity in luxury real estate is considered quite promising and interesting. In this case, the developer develops exclusively residential buildings outside the city.
- commercial real estate. Industrial facilities specialists make most of their profits by renting out finished premises. The scale may vary. Thus, a developer can develop both storage facilities and facilities for factories and industries.
- Plots of land. Such a scheme of work is associated with high risk, and the implementation of the project requires a lot of time. The development company acquires the site and develops it. Specialists improve the territory, draw up documents, conduct various communications. In the future, the land is divided into building plots. The end buyer receives comfortable platforms with all necessary documents.
- Residential Properties. Not only construction, but also reconstruction is possible here. It is this type of earnings that is considered the most common. Experts evaluate a combination of factors that affect the final cost of housing. Usually take into account the environmental friendliness of the area where the construction will take place. It is also important to find nearby developed infrastructure. In addition, the developer predicts the approximate level of income of those who will buy housing in the house.
Large companies can seize all types of real estate at once and attract investors. However, more often developers choose a certain niche and develop in it. There are not so many speculative specialists, because a good start-up capital is required, and the risks are much higher. The same applies to land developers.
The work of developers requires large investments in themselves – as a specialist. A professional must have knowledge in several areas at once. At the same time, personal qualities also play a big role. The work is connected with communication with different people, with a lot of constant stress.
Stress tolerance and an analytical mindset are very important in the profession. Also, the specialist must be purposeful, have organizational skills and leadership qualities. Organizational and administrative activities are very important for the developer. So, a specialist should be able to select a team and organize its work. You will also have to communicate a lot with representatives of various instances, where endurance and the ability to convince will be needed.
The developer can hire assistants, which compensates for the lack of knowledge in any areas. However, you need to be able to choose the right shots. This will require not only personal skills, but also experience.
The profession is associated with risks, which means that a specialist must be able to calculate them and take responsibility.
Knowledge and skills
A successful business requires multitasking from the developer. You need to be able to correctly assess the current state of the real estate market. A professional can analyze trends in this unstable area and draw the right conclusions. You should be able to make a decision on changing the profile of an object in time. It is important not only to do this, but also to properly organize the whole process.
Quick decisions based on analytical data allow you to increase the profitability of the project. To do this, the developer must have at least theoretical knowledge of engineering and construction, and it is better to have practice in this area. A professional must have a higher education: economic, legal or technical. Additionally, knowledge of construction technology, a deep understanding of the real estate market are required.
A qualified developer must thoroughly know all the legal, financial, engineering and construction details of the work. Additionally, the specialist needs to understand advertising and marketing. Usually every developer has knowledge in architecture. For the organization and implementation of the project, it is important to be able to legally formalize all transactions and stages.
Becoming a developer is not easy. First you need to get a higher education. Only after that you can start developing in the profession. Let’s list the best universities.
- Open Institute. It is better to go to the “Construction” department.
- Academy of Entrepreneurship under the Government of . Here you can learn to be an economist.
- State University. The specialty “Economics of the enterprise” is excellent.
- MISiS. And here you can get an economic education.
- National Research University “MPEI”. The department “Economics” will be the most successful option in this institution.
In USA, development is developing gradually. This is the reason for the small number of qualified specialists. Usually people come to this area from the construction business. A designer or a project manager can become a developer. That’s just to study in this area will have to constantly.
Those who can achieve great success who received a higher economic, construction or financial education. Less often, graduates of technical faculties come to real estate. There is no separate specialization in any institute, so you should look for those that are close in meaning.
The profession is multifaceted, so you will need knowledge in the field of law, business and engineering.
The specialist will not interfere with education in the field of marketing. Today there are many successful developers with technical degrees. However, it will not be possible to confine oneself only to the institute. We’ll have to look like English courses and do advanced training. The specialization of business administration (MBA) will not hurt. This will help to correctly calculate finances, recognize prospects. Also, the developer must be able to establish and use connections, attract investors. Additionally, you will have to activate the skills of a manager in order to coordinate the activities of other participants in the process.
A big advantage for a professional will be IPP (Individual Professional Project). These are internships in real conditions. They provide hands-on experience. The latter is highly valued in the profession. Developers without experience are not trusted, because the risks are too high. There is also the Arsenal School of Managers. There, on the course “Property Management” there is an opportunity to gain basic knowledge in the specialty. After receiving the minimum skills, you can go to a development company.
They usually self-train their employees. This allows the firm to develop a good specialist, which is easier than the initial search for a qualified employee.
Project management in this area comes with responsibility for the success of a multi-million dollar business. Professionals work hard and hard, which is fully compensated in case of a successful project. There are few developers with good knowledge, so big companies often offer additional bonuses and social packages. The salary in USA is 2500-10000 $
In this case, payment is formed from two parts: rates and bonuses. The first is negotiated in advance and does not change depending on the project. But bonuses consist of a percentage of the total cost of the object. At the same time, a lot depends on the place of work, qualifications. In a large company, they usually pay more, especially if they have the necessary knowledge and experience. Small firms are engaged in smaller projects, which means that the payment will be different. However, in the latter case, both risks and responsibility will be less. When choosing, you should focus on your own knowledge and skills.
With proper experience, you can not work for the company at all. The developer can simply assemble his own team of specialists and conduct entrepreneurial activities. In this case, the level of income depends solely on the specialist. However, the risks in such a situation also fall on the developer, and not on the company. If the project fails, the costs will be very high.
Career and prospects
Development in this area depends on many factors. A career is special. Usually the developer already has experience in managing several projects. A specialist can independently hire qualified workers and take on maximum responsibility. The main prospect is to open your own business. An alternative is to consider a seat on the board of directors of a large company. Usually, development begins with work in the fee-development format. Completing tasks from large investors will allow you to make a name for yourself on successful projects.
Over time, customers will be imbued with confidence, and it will be possible to develop a completely independent activity. In this case, a speculative type of activity is used. Profit in this case grows tens and hundreds of times, and with it the risks.
However, one should not assume that only the volume of construction plays a key role in determining the leader. In fact, the indicator is important, but not the key. Some companies attract more customers and have better profits due to business balance. When choosing a development line, it is important to decide how much a specialist wants to take on high risks. If there are many unsuccessful projects, then customers will simply stop trusting. This will lead to the death of the company.
In some cases, it is much more promising to move from a good position in a large corporation. In this case, the developer will never be left alone with the problems and difficulties of the real estate sector.