A Quick Look at Commercial Real Estate Development

A Quick Look at Commercial Real Estate DevelopmentImage by Pexels

Real estate development can often seem like an inaccessible line of work to those outside of the industry - new properties take years of planning, coordination, and construction with no true guaranteed return on investment. But getting started is often easier than you’d think, and with all that hard work, there also comes the opportunity for huge profit. In this article, we’ll take a quick look at this multifaceted profession.

Understanding Commercial Real Estate Development

The main role of a commercial real estate developer is to organize and build/renovate business-intended real estate. This can involve the establishment of a property from scratch or, more commonly, renovating existing properties with the aim to add value/increase cash flow. The types of building typically developed in the commercial sector include: 

      Office blocks

      Retail units

      Industrial structures

      Multi-family units

The developer typically takes responsibility for site selection/evaluation, negotiates contracts, handles zoning and entitlements, oversees construction, and more. To succeed in this role, strong interpersonal and organizational skills are a must, and there are credential requirements to boot.

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Real estate developers are expected to hold degrees in applicable fields such as management, business, or engineering. It can also be in your interest to pursue a real estate license in the state where you intend to work - some employees also require a license for property management. It will help if you have a strong working knowledge of economics, office procedures, and strong administrative skills.


The process of commercial real estate development can take years from start to finish, so it’s important to segment the steps and understand each one individually. The first task is to identify a piece of vacant land or existing property to build upon - this alone can take years, so it’s important to remember that, over time, the economy and market demand can shift. Smart developers take shifting circumstances into consideration and try to manage risk along the way.

There are many variables that come into play when deciding whether a site is viable for development. These include local demographics, accessibility, competition, and environmental factors. It’s important to take the time to understand the methodology of site selection early in the process.


Prior to construction, it’s common for real estate developers to secure a capital stack - which is the debt and equity structure normally used to fund the project. There are multiple ways to attain this depending on the project type and willingness of the developer to open up access for equity partners. Occasionally, development is capitalized internally (which means that equity is placed by the developer), but typically, a project will rely on multiple investors.


With a building permit in place, funding to see through the project, and a team assembled, the construction process begins. Developers work closely with general contractors to confirm plans and identify timelines. They may also outline costs associated with development as labor/materials can alter a project budget. It is at this stage where any decisions about minute building details will be made - for example, a developer may choose particular lighting for safety, especially if the building offers a parking garage. This helps drivers and pedestrians to navigate tunnels/canopies but also brings additional safety by deterring crime.


Once construction is finished, there is still plenty of work to be done. Sales and marketing teams will have been involved from the start of the project and will aim to have materials assembled prior to finishing so that customers are already in line. Often social media marketing is employed for maximum cost efficiency - for example, Facebook advertisements can precisely target individuals or businesses, and, with a Facebook ad template, it’s possible to customize content with your own logo, branding, fonts, and colors.

Commercial real estate development is a long, arduous process, but the rewards can often be tremendous. If you aren’t intimidated by the above and you have the patience to see a project through, you might be made of the right stuff.

Carey Scott is a Realtor® with Prestige Property Brokers in the Columbus, GA, area. Learn more about his services, at: https://www.columbusgarealestate.com/columbus-ga-realtor/



Carey Scott, located in Columbus, Georgia is a highly skilled and knowledgeable TOP Columbus real estate agent. As a FULL-SERVICE real estate agent, my mission is to provide you, my clients with the pinnacle of service, staging, and redesign expertise, as well as top-notch real estate marketing when buying or selling your Columbus Home.

A local Columbus, Georgia real estate agent is ready to help you find your dream home!



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