The 50 things right.
By Peter Micalos
People often contemplate what it takes to deliver a successful property development.
The answer is much more complex then one might think on face value.
The reality is that successful property developers need to get 50 hard things right. Of these 50 things, the average pundit on the street wouldn't even know what 85% of the terms actually mean.
The journey starts by recognising that Developers sell products to consumers. Just like many other businesses do in the world.
Many Developers don't actually pause and recognise that they sell products to consumers. Once this is acknowledged, we can then ask ourselves the following questions:
- What does the consumer want ?
- What can they afford ?
- How can I deliver this and make a profit ?
- If I can't give them what they want how do I change what they want and offer them an alternative ?
- How do I make sure they are happy with what I have sold them ?
- How do I keep doing this over and over again ?
To execute the above you need to get 50 things right. Its not one thing in isolation that will deliver success, its the combination of everything that is powerful and leads to the best results. Here are the 50 things in no particular order:
1 - Site selection and acquisition
2 - Paying the right price for the land
3 - Getting the design right
4 - Market research on what the consumer wants
5 - Appointing the right architect
6 - Appointing the right consultants
7 - Obtaining the right yield and density
8 - Creating a good design outcome
9 - Collaborating with the builder early
10 - Collaborating with the sales teams early
11 - Submitting a quality DA submission
12 - Effective engagement with Government and council
13 - Effective engagement with community & stakeholders
14 - Obtaining a timely and quality DA approval
15 - Having a strong vision for the urban and design outcome
16 - Effective pre-construction design and planning
17 - Selecting the right builder
18 - Contract negotiation and execution with the builder
19 - Value engineering
20 - Robust cost planning
21 - Using the right sub-contractors on a job
22 - Maximising the yield
23 - Design flair
24 - Appointing a quality lawyer
25 - Obtaining strong valuation's
26 - Financing the project with the right capital structure
27 - Having a robust contract of sale
28 - Having a quality Development Manager
29 - Strong governance
30 - Executing an effective marketing campaign
31 - Good market research
32 - Implementing a good pricing strategy
33 - Dynamic pricing
34 - Implementing the right legal structuring
35 - Strong PR strategy and execution
36 - Having a powerful and engaged sales team
37 - Using effective property technology
38 - Knowing the customer
39 - Getting the GST structuring right
40 - Getting the tax planning right
41 - Running a quality registration process
42 - Proactively managing settlements effectively and on time
43 - An effective sales & marketing strategy
44 - Strong financial management & reporting
45 - Getting the product right
46 - Strong leadership
47 - Maximising return on equity
48 - Good risk management and de-risking
49 - Speed of delivery
50 - Leaving enough of the pie for everyone to make money