Building your Real Estate Team
Last week, I wrote about how to set up a real estate development shop. Although we discussed the tools needed to set up shop, the most important ingredient is staffing your team. In today’s article, we will discuss the different team members that assist the real estate developer from start to finish. If you don’t know what a Phase I consultant is, you will know after reading this article. Afterwards, you will probably know more than some other real estate folks out there.
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Crucial key members of your team include:
- Broker: He is a key member of your team during the early stages of the game for he understands the dynamics of the local real estate market, the demand for retail, and the supply of new and existing retail in the market. The broker also serves as a substantial wealth of information in terms of sales and rent comps provide the real estate developer valuable insight into the market. He can provide valuable assistance in identifying a potential development site, acquiring an existing property, disposing your completed property, and leasing your property. The broker is often one of the first individuals that the real estate developer will be in touch with in terms of identifying a potential project. For example, some large retail brokerage firms include: Terranomics, The Shopping Center Group, and Cornish & Carey.
- Environmental Consultant: Your environmental consultant will assess the property from an environmental standpoint to prepare Phase I, Phase II, and Asbestos Operation and Maintenance plan reports. The Phase I report is your first step to assessing the environmental conditions of the property or the site (underground storage tanks, above ground storage tanks, PCBs, toxic chemicals on site, etc.). If there are environmental conditions where leaking of chemicals may have occurred in the ground, a Phase II study may need to be conducted. Lastly, the Asbestos studies and Asbestos Operation and Maintenance plan reports can also be prepared by the environmental consultant to address the impact of asbestos that may reside in an existing structure. Some of the largest environmental firms include PSI and EMG.
- Property Condition Consultant: He will be able to assist you in quickly surveying the existing condition of the structure. What is the foundation of the existing build, what materials were generally used in the construction of the property, provide a quick assessment of potentially hazardous conditions that may reside on the site, and more. The property condition report often provides a “general lay” of the land. A larger property condition firm in the industry is Property Condition Assessments.
- Architect: He is one the most crucial players in transforming your vision into reality. Some of his common tasks include generating renders, producing construction drawings for the building(s), and managing the general contractors (if contracted for the service). The architect interacts closely with all various parties that may include the landscape architect, civil engineer, soils engineer, surveyor, general contractor, interior space planner, signage consultant, and other parties. It is important that the real estate developer choose the architect carefully for the consultant will play a big role in determining whether the project remains on track. Depending on the size of the project, you should carefully choose an architect. Some architect firms include HDR and Gensler.
- Landscape Architect: The landscape architect focuses on designing the landscaping for the site. He interfaces closely with the architect and can provide guidance in terms of selecting ground cover, plants, and trees to beautify the project while providing necessary shading.
- Surveyor: He will survey the property identifying the boundaries of the property, providing topographic information of the site, and other valuable information. The surveyor will often work closely with the civil engineer.
- Civil Engineer: The civil engineer will work to assist with all sitework related issues in terms of preparing the site for construction. Issues that the civil engineer will deal with typically include drainage, easements, utilities, fill, limited structural issues, and much more. He is a valuable player during the early stages and often interfaces closely with the architect.
- Mortgage Banker: Securing financing for the project is often a challenge sometimes. To obtain the most competitive loan terms, a mortgage banker can be invaluable in securing construction and permanent loans. Additionally, he can assist you with securing a potential joint venture equity partner. The mortgage banker serves as the point person to structuring the financing necessary for your project. A real estate developer does not always employ a mortgage banker and often fills the role himself. However, the banker allows the real estate developer to focus on other parts of the project while the mortgage banker structures and manages the financing on behalf of the real estate developer. Some of the most recognized mortgage bankers include HFF and George Smith Partners.
In the my next post, I will go into further depth and discussion of other important team members in the real estate development process.
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