Who is a Developer

Developer is a person or organization, which undertakes the work of developing a Residential , Commercial or Institutional building . He is only in the role of Development, or say supervision, and generally not into execution,  means construction. He/ They may or may not have experience of Real Estate before undertaking that particular project.

For this he hires various agencies for various works. He hires requisite staff to get the works executed smoothly. He Puts in his money initially & than goes in for loans from various agencies or offer CLP(Construction Linked Plan)  to its clients.

His prime responsibility is to ensure that the project is made as it was committed to clients who have booked properties in that project and with in the committed time frame.

One big thing we need to look in a developer is : Past Track Record

Past track record of owner of development firm if he is a single person , or the management if it is a group of people matters a lot. They should have a track of delivered projects in the past, if background is of Real Estate or running the business successfully & profitably if in some other business. He/ they should also enjoy good credibility & reputation in market. These factors are very important for purchasing an under construction property.

Things a Developer is supposed to take care of

1.  Location

      He should have a futuristic vision, and with this should select the location of the project, which might not be so prominent at the moment but will gain importance as the time will pass and by the time project will be ready for delivery.

    He should study what are Government’s plans to develop that area, how infrastructure is going to develop in that area , what is the pace of Residential development and most importantly plans for commercial & institutional development.

       The reason for looking currently underdeveloped land , but plan for        future development are , that this land will be at much lower rates as        compared  to land in fully developed area. So this saving on land cost can be passed on to the buyers of unit as well to increase the profitability.

2.  Sufficient Liquidity

       A developer should have sufficient liquidity so as to run the show before the money from loan or customers under Construction Linked Payment Plan starts coming. He should have necessary buffer to meet any contingency/ emergency.

3.  Local Laws

       Developer should make himself aware of all the laws governing that        area. He should ensure that he does not miss out on any law. If need        appears to be he can hire a local Lawyer/Architect/Consultant. Missing out or      violation of any law can create big problems for the  project at later stages.

       He should not only be aware of laws governing project but also laws        governing independent Units/Flats.

4.  Consultants/Contractors he needs to Hire

    Broadly speaking a developer is supposed to hire following Consultants/ Contractors at different stages of project :

                           I.   Architect

                         II.   Surveyor

                       III.   Lawyer

                        IV.   Structural Consultant

                          V.   Civil Contractor

                        VI.   Electrical Contractor

                      VII.   Plumbing Contractor ……….   & So on

5.  Membership of Developer Bodies

       A Developer must take memberships of Developer bodies like :

                              I.   NAREDCO

                            II.   CREDAI

                          III.   IGBC

                           IV.   ASSOCHAM

                             V.   CII

       

These memberships not only add to your credibility , but are also a big source of knowledge as they regularly publish their Newsletters, Hold Seminars& Workshops. These are also a big platform for networking with other already developers of the area from whom, based on their experience, you end up learning a lot.

       He should attend Seminars & workshops, read journals, books &  articles regularly to keep himself updated about the latest Technologies & Materials in construction using which he can keep the cost at his project at lowest possible.

       As an example these days Pre-fab is lot in news. It reduces the        construction time and many a times lower in cost as compared to        traditional brick-mortar construction. So many a developers are shifting to this depending upon the type of construction.

6.  Relations with Local Channel Partners Big or Small

       In India majority of the Real Estate sales happen through Channel   Partners, having Brick & Mortar office. So you and your team must develop relations with Channel Partners in your area, update them about project details & leave project details with them. Means you should  have relations with all channel partners in the area.