Commercial real estate development takes a considerable amount of time and expertise. From acquiring land to building the final product, there are many steps in between.
Retail, industrial, office, mixed-use, and multifamily buildings all fall under the category of commercial property. Each of these types has unique needs.
The Related Companies is one of NYC’s most prominent commercial property landlords and notably managed the Hudson Yards project. They also have a hand in One Bryant Park and more. For more information on where to find commercial property development companies, click here.
Zoning and Entitlement
When developing a property, it’s essential to understand the legal boundaries of your land. It can be a complex process, especially when working with local governing bodies with different perspectives on real estate development. For example, some local areas may be strict enforcers of the rules, while others might encourage growth and ease the entitlement process. Depending on your location, the length of the entitlement process can vary significantly.
Entitlement refers to a municipality’s approval of a real estate project or property for a specific purpose. While zoning regulations typically limit what types of buildings can be constructed in a particular area, entitlements provide more detailed and tailored approvals for your project. The types of projects that require entitlements include ground-up construction, change of use, and even adding a new façade to an existing building.
During the entitlement process, your commercial property developer will work with various professionals to ensure your project’s success. These include surveyors, engineers, architects, and more. This part of the process can be very time-consuming, and it’s essential to have a professional team in place to ensure that your project is approved.
Once you’ve completed the zoning and entitlement process, it’s time to move on to the planning phase of your project. It involves creating a detailed plan for your commercial development site and the buildings that will be built on it. This process will include the cost to construct your buildings, the amount of land needed for each installation, and how each building will be connected to other facilities and public infrastructure. Once the plans are complete, it’s time to submit them for approval by local officials and community members.
Planning
Developing commercial property requires an extensive amount of work, time and money. That’s why developers must have a high level of commercial real estate development knowledge to ensure that the project they’re taking on is profitable.
One of the most crucial aspects of this process is planning. Without proper planning, a project may be deemed unfeasible, costing a developer a lot of money in lost opportunities. Planning involves determining whether the proposed property has the proper zoning and entitlements to support the project’s development. Community meetings and discussions with local council members or officials often achieve this.
Many developers have a background in architecture and engineering but will still use the services of firms that specialise in this real estate area. These firms will perform site studies to determine how to develop the building. They’re often strong lobbyists, too, and can help developers get any variances they need from approving parties or the city.
Once the architectural plans are finalised, they’re sent out for bidding to general contractors to see if they can deliver the project within budget. The developers will have already had a good idea of the costs associated with the project before this stage. Still, there’s always a chance that labour and material prices could change drastically during the construction phase, potentially causing significant cost overruns.
During this stage, the developers will start forming relationships with local businesses and residents, particularly those using the facility once it’s completed. They’ll try to keep the lines of communication open and will take feedback on board to make any necessary changes. It is a critical step in the whole process, where a seasoned developer shines. They’ll know how to build a development that’s not only profitable but will also benefit the surrounding communities. For more information on where to find commercial property development companies, click here.