What is Property Development?
What is Property Development?
Fundamentally, property development is about adding value to land by renovating and reimagining its uses. As our cities and communities expand, property development is a necessary process. New grocery stores need to be built. Light residential areas make way for apartment buildings. A startup renovates an old warehouse into an office.
The most successful property developers recognize trends before they happen. They notice how the city is growing and how demographics will shift. For example, a property developer in the 1940s might have made good money setting up a bowling alley before the sport reached its peak popularity.
In this article, we answer, “What is property development?” The team at the PM Company hopes this information helps you begin the journey of investing in and improving upon your property.
Why Develop Property?
There are many benefits to property development. Speak to a representative at the PM company to see if property development is right for you.
1. Financial Reward
Real estate is a lucrative investment opportunity. Because the population is always growing, people will need spaces to live and work in. Moreover, cities are becoming more and more crowded, meaning wealthy individuals will pay higher prices to live in desirable areas. Many people develop property in order to make money.
2. Business Needs
Each business has its own unique building requirements. A retail store might find an attractively-priced space that needs walls removed and storage installed. A business that has grown rapidly over the past year might need a larger space – they might even build a brand new headquarters. A well-considered property can be a great boom to a business.
3. Community Development
Finally, some companies will develop properties in order to benefit the local community. Someone might demolish a condemned house and make way for a community garden. Others will renovate commercial properties in order to spur business growth. For years, the PM Company has been active in supporting our local communities.
What Does the Property Development Process Look Like?
Property development is not an easy task. It requires deep planning and execution. Before deciding whether to start developing a property, consider the following steps.
1. Understand Your Goal
Will you be building a brand new structure or will you renovate an existing structure? What are your needs? For example, a company looking to build a new apartment will need to calculate the number of units times the expected rent to be charged to see if it’s a financially feasible project. Get clear on your goal for property development.
2. Find Funding
If you’re considering developing a piece of property, plan out your capital needs. Find investors and see if there are any government grants that can help with the development process. Speak with a lawyer about setting up an LLC or another corporate entity so that you minimize personal liability. Too many development projects fail because the leaders failed to adequately plan for financial setbacks.
3. Get the Proper City Documents
Zoning is a complex reality of property development. Not only do you have residential, commercial, and industrial zones, but there are different regulations depending on where in the county you build or what kind of structure you’re building. You’ll need to check usage allowances, building height requirements, noise considerations, and more.
You may also want to discuss your plans with the local community. Not every resident will be excited about your new project, and local resistance can cause headaches and delays.
4. Find a Trusted Contractor or Construction Company
Who is going to complete the physical development work? Make sure you find a construction company that can complete the project on time and under budget. Do you have specific needs for your property, like workshop equipment or electrical setups? Discuss these needs with your contractor before the project begins.
5. Get Started Developing Your Property
Property development is rarely a smooth process. Once you start, many things can go wrong. But for those who persevere, there are many rewards. Remember your original goal and keep pressing on. Don’t let minor setbacks discourage you.
What is the Average Cost to Develop a Commercial Building?
This is a difficult question to answer for many reasons. Are we talking about a new build or a renovation? Is this building located downtown or in a rural community? Costs vary state by state.
That said, you can expect to pay $20 to $50 per square foot to purchase an existing commercial building. The $50 per square foot figure factors in renovation fees and custom work. The price will vary based on the type of building. A stud-frame location will cost less than a steel-frame warehouse.
The PM Company is Here to Help You With Your Property Development Needs
The PM Company is your go-to resource for property development in the Mid-Ohio Valley. Our company has been family-owned for generations, which means we understand the area and the local businesses.
We have multiple properties available for development and leasing. Our clients are always provided the best advice and guidance as they choose the location that’s best for them. From medical centers to commercial plazas, we offer a wide range of quality properties.
Questions? Please ask! Our team is known for our friendly and professional service. We’re happy to come alongside new and veteran property developers as they seek to obtain a new or upgraded location.
