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On any project, a developer is rolling the dice, betting a string of unrelated and often uncontrollable events will fuse to create a success.
If they do their homework, control their ego and fortune shines, then they might make money, maybe a fortune. Just as likely, the commercial or residential real estate developer will be buried in bad luck, wrong assumptions and torrential misfortune.
As they say, mistakes happen.
On LinkedIn, members of the UK Property Investors/Developers group are discussing their “top five major pitfalls in developing.”
Some of the responses are predictable: “Do your homework” and “inadequate due diligence,” for example, pop up in many forms, as does overpaying for land (which seems to be a twist on the same response). The trauma of managing cash flow is also mentioned several times.
Some of the other pitfalls making the list:
* Not conducting proper public consultation/participation
* Finding a good plasterer
* Not understanding the real market conditions
* Failing to undertake design and technical reviews
* Not having robust project plans in place - specifications/timescale/budget
* Lack of contingency
* Procrastinating buyers or end users
One developer opted to list only one pitfall: “Thinking you are going to make a fortune!”
