1. Real Estate Development
Lecture 01
The real estate development process
Reading: Chapter 1 - REDPP
23 August 2011

2. Outline Background Introduction to RED Knowledge needed The developer
The RED Process
Going to be interactive... Pardon me.
The real estate development process

3. Background: Maslow’s Hierarchy:
Self-fulfilment (development of one’s potential)
Esteem (self-respect and the esteem of others)
Relationship (affection for people/ belonging to a social group etc)
Safety (security/ predictability/ order)
Shelter for people, for their businesses, for their recreation etc
Physiological needs (basic needs for food/ drink/ shelter/ air etc)
The real estate development process

4. Background What is shelter?
Structure providing protection against the external environment (
History - followed the development of man/ society.... From tree trunks and caves to contemporary complex structures
The real estate development process

5. The real estate development process

6. Introduction to RED
Real Estate Development is the continual reconfiguration of the built environment to meet society’s needs.
Examples:
Residential dwellings
Roads
Sewer systems
Commercial centres
Industrial centres
Entertainment centres
etc
Constant need due to:
Population growth
Evolution of technology
Changing taste
Life style choices
Revolving immigrant groupings
Economic changes
Each person says what they will want to live in
The real estate development process

7. Background What informs REDs? Need of developer User requirements
Comfort
Purpose
Demographics
Etc....
Given unlimited funds to put up a development what will they put up and why?
The real estate development process

8. Knowledge needed Public Policy Real Estate Development
Elements of building design
Infrastructure
Financing
Risk Control
Time Management
Real Estate Development
Marketing
Conveyance & contracts
Urban development
Legal requirements
Local regulation
The real estate development process

9. Components Is RED and Art or a Science? Why?? Components:
ARCHITECTURE – conceptualization, schemes, design
FINANCE – Economics, Funding, Lending
MARKETING – Research, Analysis, Conclusions
MANAGEMENT – Consultants, Firm, Project Management
CONSTRUCTION – Engineering, Building
More???
The real estate development process

10. The Developer Owner, Manager, Consultants or Partner
Should have a good reputation because:
Held in high esteem by general public
Work has great impact on community
Work is visible for criticism
Creates/Provides shelter, innovation and attractive contributions to the built environment
Communities grow with or without developers but growth need to be managed to create positive effect on Community
The real estate development process

11. The 8 stage model (P. 7) Contract Negotiations Formal Contract
Feasibility
Construction
Refinement of the Idea
Completion & Formal Opening
Inception of an idea
Property, Asset & Portfolio Management
The real estate development process

12. The RED Process IDEAS SPACE REALITY VALUE/ CURRENCY The RED Process
The real estate development process