January 2, 2019
5 Tips for Successful Project Management in Real Estate Development or Construction
First There Are Real Estate Developers and Real Estate Development
A real estate project begins as a real estate development or property development. It is a multi-leveled business process that consists of numerous activities including the purchase of new land, the sale of developed land or property to others, the renovation of existing land or property (buildings) or the development and construction of new buildings and property. Real estate development and construction have several things in common; and one that is integral to each is project management. And the need for a project manager.
While developers will purchase land or property, finance real estate transactions, have builders construct projects, and cogitate, create and develop the whole real estate project from beginning to end, it is the project manager who truly oversees and orchestrates all the real estate components and participants to get the whole job completed.
Of course, the real estate developer and project manager work with many different people during the entire real estate development process. These may include city planners, government officials, attorneys, architects, surveyors, inspectors, leasing agents, contractors, engineers (of numerous kinds), construction workers, scientists and others.
Then There is the Project Manager to Oversee and Lead the Whole Project
It doesn’t matter if a real estate developer buys a property with plans and permits already in place, or he takes a preexisting property with the intent of renovating it or reconstructing it from scratch, every development needs a manager to oversee the project and be the general in charge to see to the development’s proper construction and completion.
A project manager’s first responsibility is the on-budget and on-time completion of the real estate project. He works for and usually answers to the real estate developer or owner(s) and is sometimes involved in due diligence and site selection even before construction begins. The project manager’s job often includes securing entitlements, permits and correct zoning, choosing the right contractors, as well as establishing a working budget and schedule.
A project manager represents the owner on-site and is his commander in chief, so to speak, and main representative of the entire project. Thus, the importance of a real estate developer seeing his project achieving success and reaching completion is totally dependent on hiring the best and most qualified project manager. In effect, the number one goal for successful project management in real estate development or construction is finding and having such a project manager in charge of the entire project. To this end, here are five tips or essential qualifications a project manager must possess for a development project to achieve such success.
No. 1: Knowledge and Education
It is a critical that a project manager know every aspect and component involved in a real estate development project. He can’t be one who wings it on the fly! Or expects the process to be a on the job experience with manuals in hand or reader glasses to be called into play at a moment’s notice! Hardly. His knowledge of the entire real estate process and of the development project he is hired to oversee has to be extensive and complete. However, in addition to this, it is usually and most advisable that such a person have a formal education in real estate development and construction, no less than a bachelor’s degree. A project manager has to work with a myriad of real estate subjects and experts—anywhere from carpenters to plumbers, planners, architects, building constructors, environmental engineers and electrical engineers to safety experts and chemical analysts. Knowledge and education have to come with credentials and certification. The project manager has to be intelligent and educated.
No. 2. Experience & Leadership
While education may be mandatory for a project manager’s credentials, hardly anything is superior to the power of experience. And most critical to his experience has to be the quality of leadership. As alluded earlier, a project manager in many respects is like a general leading an army—before as well as in battle. The victory he has to achieve is successfully leading, guiding, instructing and moving dozens of teams of real estate and construction workers and experts to the goal of creating and completing the real estate project on time and to complete success. He has to have experience to accomplish this. Experience working on previous projects showing evidence of success. And evidence of his real estate project management and leadership experience and abilities.
No. 3: Organization and Quality Control
A project manager should not only possess the education and experience to move people and a project from point A all the way to its successful completion, but an intuitive ability and understanding of people to organize teams and personnel so they work at their greatest potential and in harmony with each other. This organizational ability includes scheduling tasks and phases of development and his assigning the right teams and personnel so conflicts do not occur and timely completion of every task and phase does. Inclusive to this is maintaining the highest standard of quality control and inculcating this in every employee and worker involved in the project. A true project manager never settles for less than 100% excellence. From himself and every other person!
No. 4: Communication and Personnel
Superior communication abilities are, of course, crucial to a project manager’s success on a project. Once more, he requires an almost intuitive understanding of people, regardless of job position, nationality, background or profession. He has to be able to make every individual understand him clearly and precisely at all times, and thus know how to communicate to each individual successfully. Every worker or member on a real estate project is important to the success of that project. Even the caterer who brings meals to the site each day. An ability to delegate authority and work begins with the ability to communicate effectively at all times. And do so with every member of every team on the real estate development site.
No. 5: A Plethora of Skills
The project manager can often spend as much time in the office as he does on a construction site. His knowledge, education and experience will come into play on an hourly basis. Thus, his skills in every phase of the development and construction process will be continuously called upon and needed. These can include, but are not be limited to, ensuring information concerning all work tasks are obtained and assigned each day; planning, directing and monitoring activities of all project teams and personnel; ensuring all required resources of personnel, equipment and materials are present on-site and in the right quality, quantity and condition; scheduling and managing contractors and subcontractors; following permits and contracts and legal processes; overseeing and maintaining the budget; having excellent computer and software skills; ensuring that salary and personal needs of workers are met; understanding conflict resolution and how to implement it; and being good at math and accounting and at numerous administrative tasks are all skills a topnotch project manager needs to have!
There are several key organizations a project manager may belong to that can help define him as being the topnotch project manager a real estate developer or company needs for their project. A few of these organizations are:
- Associated General Contractors of America
- Construction Managers Association of America
- US Green Building Council
- Associated Builders and Contractors
- Design Build Institute of America
Truly, the goal of every real estate development is to obtain the services of a topnotch, well-educated, deeply-experienced project manager who is also a leader and endowed with skills that can successfully address and handle every phase and challenge pertaining to a real estate project. It’s not easy to find such an individual. But it is essential and definitely worth it!