Developing (or significantly redeveloping) real estate properties in order to realize their highest and best use is a whole different beast than merely buying and selling, or leasing out or renting, properties that have already been developed.
Entirely different skills sets, knowledge bases and contact lists come into play. This arena is as much an art as it is a science, and it is an unpredictable blend of governmental zoning change approvals, permits and entitlements, project and construction underwriting and financing, architectural and construction and project management, title and insurance along with the expected marketing and sales …and each component expects all of the other components to already be in place.
Yet with the higher risks come the higher rewards, and the experience of creating something from almost nothing. Perhaps the truest skill and indicator of success is the ability to be able to bring together all of the participants and moving pieces at the same time, and to keep them together over an extended period of time while continuing to make sure that the deal continues to work for everyone no matter what challenges crop up.
Commercial developments can often occur in several distinct phases, and sometimes with different specialized participants at each distinct project phase. Each of these participants invests capital and time, and takes risks, in order to move the process forward and add value ready for them to sell it onto the next developer or construction contractor in the project execution chain.
At the relevant point the project is completed and the physical buildings then get to be used by the originally intended occupants, or else the buildings need to be sold or leased out and filled with the new occupants that have been attracted.
