Salary and Personnel / 10.02.2024

Who is a developer, what does he do and what is a development company? Developers: who is this in simple words, what does a development company do? What does a development company mean?

The list of borrowed words included in the modern Russian language is constantly expanding. Many people ask the question: “Who is a developer?” The English verb “to develop” means “to develop, develop.”

A developer is a specialist who leads the development, promotion and further sale of real estate, going through the entire path of the project from the very beginning.

The main goal of such activity is to obtain maximum profit from the transaction.

The emergence of developers in Russia

In Russia, development began to emerge at the beginning of the 21st century, when the construction market after the crisis began to develop at an accelerated pace. But in those years, not a single company could offer quality services. Later, the market reoriented from the number of buildings to their quality and, accordingly, the high cost of sale or rental.

By 2005, a separate business area had emerged - development, which controlled the entire development cycle, and now it has unprecedented demand for its services.

A real developer is a professional in all areas related to real estate.

Developer functions

The scope of activity of a developer is quite wide and his functions are based on knowledge in various fields:

Assessing a potential deal. It is important to conduct a competent analysis of the location of the site where the future construction project will be located and its commercial opportunities. Research the market and the availability of all offers for the most effective use of the planned structure. Resolve the issue of the probable purchase of land and further support of the operation.
Design and calculation of investments. Prepare the necessary engineering and technical documentation, obtain a construction permit.
Attracting investors. Calculate the financial liquidity of the project, the amount of necessary cash investments for its implementation. Investors need to prove the economic attractiveness and the presence of minimal risks of loss.
Reasonable distribution of finances. The developer is required to avoid possible losses and competently monitor the implementation of the entire process.
Resolving emerging issues with state and municipal authorities.
Conducting construction until the facility is fully commissioned. Supervise all work carried out, accounting and consumption of materials, try to minimize investments, but increase the cost of the building itself. Find a middle ground in this.
Management of all available resources - people, finances, materials.
Obtaining maximum profit from sales.

The developer also conducts marketing research and uses advertising techniques that will ensure the main success of the deal.

Development is a process during which an entrepreneur transforms or creates a property, increasing its commercial value.

Differences between a developer and a builder

In European countries they are not used to the term “developer”. Developers are involved in the real estate sector.

According to the legislation of the Russian Federation, a developer is a legal entity that owns a plot of land and attracts finance to build any real estate on this site on the basis of an official construction permit.

The functionality of the developer does not imply such a diverse number of tasks to be solved and a wide range of activities.

Types of development

Depending on financial management, there are:

development on a fee basis - the entrepreneur receives payment in the form of a percentage of the final cost of construction, without taking on financial risks;
speculative development - in addition to all the tasks performed, it itself is the main investor, the riskiness of such projects is covered by increasing income;
construction for a specific purpose, which is not making a profit.

The latter type is not always distinguished.

This area can also be divided depending on the type of real estate:

residential development;
suburban;
commercial;
land plots.

Development company its structure

Any real estate today is a profitable way to invest money, especially housing. In order to increase the value of a property, conventional construction is not enough. Development companies arise as a response to modern market demands, satisfying the requirements of society.

The company can be based on either one legal entity or a group of individuals engaged in investment and development activities. The scheme may vary depending on the chosen direction of work.

Typical structures include:

Production group – construction, commercial, sales management.
Administrative and management group - legal and financial departments, accounting, human resources department.
Technical and administrative group.

High-quality interaction of all links in this chain ensures professionalism and high demand for the company’s work.

The difference between European and domestic development

The main difference is that Western development is based on the need to create a property, based on marketing research. In our country, a project is developed for a specific plot of land available.

There are still few development companies in Russia that can compete with foreign ones, but this concept is becoming increasingly famous due to the growing urban planning and Europeanization of modern society.

In the video about development

The role of developers is becoming more and more noticeable. They can organize dramatic changes, for example, the construction of a building on an empty plot from scratch, or less noticeable ones, but sure to increase the potential of the property. Transformations are carried out in different ways.

Developers are entrepreneurs and generalists: in law, finance and construction. Consequently, there are few of them and the cost of their services is quite high.

Hello, dear readers of the blog site. Development is a term that came into Russian from English (from development). In direct translation this word means development.

If we approach the consideration from the practical side, then this term refers purely to the world of real estate.

Development is a commercial activity related to the construction of new buildings, restoration and old ones.

The specific goal of the developer (the person who does this, i.e. a real estate specialist) is to make a profit.

What is the difference between a developer and a builder?

First of all, let's look at the name itself. Although the word developer sounds respectable, it is hopelessly outdated. In addition, not only those who directly invest money in construction call themselves developers, but also those who develop the project.

Accordingly, they distinguish several types of development:

That is, the Fee developer develops the project himself, just like a speculative one, but at the same time remains an employee, like BTS.

Interesting: Individually described species are rare. The most popular variety is a mixture of speculative and BTS development, when it entrusts the development of a project to a third-party company, but at the same time makes personal adjustments.

Development process as an example

The theory can take an endless amount of time to understand, so let’s look at how exactly the development of a commercial real estate project, called development, takes place.

Stage 1. Assessing financial feasibility

The main goal of development is to make a profit. Therefore, the first thing to evaluate is the financial side. In reality it looks like this:

The information is provided as an example and is greatly simplified.

Analysis of the area and potential clients
The same businessman specifically decided to build a shopping center in a city with a population of one million. The first thing he looks at is the area. To build real estate you need a lot of space, so special attention is paid to abandoned factories, farmsteads and non-residential premises, which can be purchased from the state at a bargain price.
In addition, in parallel with searching for a place, the investor contacts friends and studies the demand for retail space. Let's say he called seven friends, two of whom are interested in opening locations in a new shopping center.
The collected information about the availability (or absence) of space for construction and the interest of future clients is enough to make a decision on the feasibility of construction.

Stage 2. Design

The collected information about investors was enough. The land has been purchased. It's time to create a specific project. For this purpose the following specialists are involved:

Builders
At the initial stage, engineers collect data on the area and draw up lists of required materials and equipment. The investor purchases materials for the foundation and rents equipment.
Economists
Economists analyze people's behavior and, accordingly, count money. At the pre-construction stage, an assessment of the city’s population is carried out, and preliminary conclusions are drawn about which goods will be more profitable to sell. Moreover, economists calculate the optimal amount of investment.
Designers
Everything is simple here: designers make sketches of what the center will look like. Most often they come from the same construction company as the builders themselves.

Stage 3. Financing

In short, financing is exactly what comes to mind first. The uncle gives money and with this money an object is built. If you delve a little deeper, the managers and financial department negotiate with everyone else and transfer money to them as construction progresses.

By the way, there are several common misconceptions, so let’s look at what NOT to do when financing:

They don't hand over money
Investors have always kept a close eye on their finances. Now it has become especially easy to do this. The process of buying, say, a steel plate looks like this: a foreman calls a steel mill, they ship the plate to him and give him an invoice, he goes with the invoice to the accounting department, and from there the accountant (usually the investor’s trusted representative) transfers the money. The possibilities of fraud are reduced to a minimum.
They do not create a unified financial apparatus
The opportunity to “warm up the hands” of minor officials still remains, since up to several thousand people are involved in the construction of the same shopping center. Therefore, in the accounting department, the calculation is recorded not as “Ivanov’s salary, Petrov’s salary, Sidorov’s salary,” but as “builders’ salary for August.” Let’s assume that 50 people build a foundation pit for 2 months and receive 15,000 rubles a month for this. The total salary is 1,500,000 rubles. She is transferred to a low-ranking accounting department that distributes the money. The number of these compartments varies depending on the scale.

Stage 4. Construction

Construction consists of two substages:

Stage 5. Commissioning

Already at the basic construction stage, the developer signs long-term contracts with major brands. Smaller businessmen who want to occupy a place in the shopping center contact brokers and also establish agreements.

Usually of two types:

Rent
Lease can be long-term or short-term. The longer the rental period, the less money it will cost each month.
Purchase
Most often, retail space is leased, but if an investor offers a decent amount, a complete sale of the retail space is possible.

Stage 6: Operation and Management

Even after the full launch of the facility, the developer continues to control his property, look for new partners, contact brokers, pay salaries, etc. This activity also refers to the concept of development.

Interesting: laws in the field of development are not formulated precisely enough, which leads to constant financial fraud.

By the way, there are many nuances in the work of each specialist that only the developer himself knows about. What this is cannot be explained in simple words, but if you say it as clearly as possible, then:

Every developer must be able to quickly assess risks and change the course of development.

Let's sum it up

As you can see, there is quite a lot in common between the concepts of development and construction. Let’s go over the basic facts again in order to remember for a long time what exactly this term means:

Development is a real estate business whose main goal is to make a profit.
A developer is a specialist in commercial real estate. It is important not to confuse a developer with an investor, since the developer can be an employee.
There are three types of development: with own funds, with partial attraction of investments and only with investors’ funds.
In classical economics, there are six stages of development: analysis of opportunities and purchase of land, project development, project financing, construction of the facility, post-operation maintenance.
To engage in development, you must have a large start-up capital or specialized education.

This is where the short story about development ends. To obtain more detailed information, it is worth talking with entrepreneurs and builders.

By the way, watching the video will allow you to understand the meaning of the process even better:

Good luck to you! See you soon on the pages of the blog site

Development company - what is it?

There are development companies to help buyers. Their activity is to change the building, increase its area or carry out reconstruction work. As a result of such measures, not only the appearance of the building, but also the land plot will be changed.

The implementation of development projects can be carried out by a specialist competent in his field. He must know the features of the real estate market and be well versed in the intricacies. The main task of the developer can be considered a successful balance of costs, quality of work performed and the ratio of deadlines.

The popularity of land development is growing every day. Almost all people prefer to work with specialized companies that will take into account all the customer’s wishes and complete the work, demonstrating an excellent result. Naturally, such services are not cheap, but you should not skimp on quality.

A development company is work with construction projects, which is impossible without certain knowledge, skills and experience. These components guarantee the high quality of all activities carried out. Before choosing a specific development company, you need to inquire about its reputation and listen to customer reviews. A large number of successfully completed development projects also testifies to the high professionalism of the company’s employees. This will help avoid possible unpleasant situations.

How do professionals work?

Although the conditions under which development companies operate may vary, there are common points. They are the ones who indicate professionalism.

The construction business has undergone significant changes in recent years. It was supplemented with various components: design, financing, real estate activities, marketing and others, thus transforming into a development business. It includes the coordination and management of real estate development processes from inception to completion.

The main development activities include:

Acquisition of rights to assets whose development is planned. This could be land or real estate. As well as rights that provide grounds for action with assets belonging to third-party owners.
Identification of the target market segment, development of a marketing strategy.
Attracting the necessary resources.
Development of design documentation for facilities,
Construction and commissioning.
Selling an object or renting it out.
Legal support at every stage of the project.

Structure of development companies

An investment and development company has its own structure. It can be based either on one legal entity or on a group of legal entities that interact with each other.

Naturally, the structure may differ depending on the specifics of the activity, goals and tasks performed by development companies. But there are still basic points.

Typical structure of a development company:

Production divisions: development management, construction management, commerce management.
Administrative and management divisions: legal department, finance department, accounting, regime service and personnel service.
Technical and administrative divisions.

Production units include those that are directly involved in projects.

Auxiliary units have an indirect impact on projects. It is carried out through interaction with production activities. The functions of auxiliary departments are typical for development companies. The business environment being formed should be as favorable as possible for the successful development of projects.

Features of development activities in Russia

Russian development companies are faced with an imperfect legislative framework, especially in the field of commercial real estate. The imperfection of norms and laws leads to the fact that negotiations are quite lengthy, which delays the process of working on the project as a whole.

The problem of Russian development includes the limited supply of proposals and the long period of time for their implementation.

A development company is always a risk, so investors are wary of investing money in development projects, and sources of financing are quite limited. The structure of the funds raised and the specifics of financing determine the specific features of each project.

In Russia, development is causing debate. Many companies substitute the true essence by calling construction activities development activities.

Signs of development projects

The need for external financing.
High investment risks and long-term
Dependence on external factors.
Coordination of project goals with the interests of the region and social programs.
Implementation of an object.

OJSC "National House of Culture"

OJSC National Development Company is engaged in the sale of land in the Moscow region and the improvement of holiday villages. Many years of experience and qualified specialists ensure the successful implementation of projects. Clients can count on advice and legal support at every stage of work. which National Development Company OJSC offers to customers are able to satisfy any needs and wishes.

JSC "Constructor"

The development company "Constructor" carries out the construction of buildings, residential complexes and social and cultural facilities in the Moscow region. All housing is of high quality and comfort. The fact that this company is a division of the large Termoservice holding allows developers to carry out the entire cycle of work - from design to

The word development itself - development n in its primary meaning is translated as development (General vocabulary. Muller (EN-RU), Akhmanova (EN-RU)).

Development means the development of real estate - carrying out construction, engineering and other operations on real estate, leading to qualitative changes in land, buildings and structures.

A developer is an entrepreneur who receives his profit from the creation of real estate (development), for which he acts as:

purchaser of a land plot for development;

the organizer of the design of the facility (licensed designers), the employer of the general contractor (with a license to perform the functions of a general contractor), property managers (if necessary);

finances it himself or attracts investments if necessary.

A developer is the one who heads the construction, manages it, taking risks. The main task of the developer is to maximize the cost of the project.

Development is any business activity associated with the reconstruction or modification of an existing building or land plot, leading to an increase in their value. In principle, development is not only the construction and reconstruction, but also the renovation of a building or premises - in the event that it increases the sales price or rental rate. This kind of development is called renovation.

Development is the process of project implementation. Development is carried out by companies that invest in construction and/or manage this process.

It has long been recognized in the world that project management is a special area of management, the application of which produces tangible results. Professionals in this field are highly valued (in the United States it is the third-highest paid profession after lawyers and doctors), and the project management methodology itself has become the de facto management standard in many thousands of enterprises and is used to one degree or another in almost all large corporations. Last year, ANSI project management standards were adopted, and a draft ISO 10006 project management standard was developed.

A project is a temporary venture designed to create unique products or services. “Temporary” means that any project has a beginning and certainly ends when the set goals are achieved, or there is an understanding that these goals cannot be achieved. “Unique” means that the products or services created are significantly different from other similar products and services.

In construction, a Project is often referred to as the construction or reconstruction of a specific facility. Although, often the project ends without any construction work. So, for example, a development company can create a legal entity, purchase a plot of land or premises/building for it and issue permits for construction work. After which the “project” can be sold, as a result of which the “development” will not take place.

Project management is the application of knowledge, experience, techniques and tools to project activities to meet project requirements and the expectations of project participants. To meet these requirements and expectations, it is necessary to find the optimal combination between goals, deadlines, costs, quality and other project characteristics.

At the end of the nineties, the real estate market was replenished with the new word developer. Its essence was understood only by a narrow circle of people. Even now, not many people know who the developer is. These specialists are involved in the direct development and construction of real estate at all stages.

What is it in simple words

The word developer is derived from the verb “to develop”. It is translated as how to develop. Developers are engaged in the development of non-residential areas by erecting objects on them. There is another translation of this word, as programmer or developer. But in Russian this concept is used very rarely.

A developer is a person who is involved in the development of a property. Objects usually mean structures, buildings, or land plots on which the developer is developing or constructing.

A developer can be an individual or management companies that are involved in the direct construction, repair and reconstruction of objects. The development company also manages cash flows in the construction project.

In Russia, the developer is closely connected with the builder. The difference is that the developer is the owner of the land, and the developer is engaged in direct work. Sometimes developers become real estate developers.

To build a developer business, you need to have construction project management skills. In our country, this direction is very promising, since there is a minimum of competition.

Features of the profession

Identification of the commercial potential of the land area and its purchase.
Market analysis for the purpose of the most efficient use of the facility.
Drawing up an initial plan for the future facility.
Development of the construction concept.
Registration of a building permit.
Controlling the overall construction process.
Conducting certain studies.
Delivery of constructed real estate for rental use.
Sale of a finished object.

Additionally, the developer is involved in solving financial issues in the construction area. This is a kind of organizer who is looking for investors and considers possible risks and costs. He also deals with issues related to obtaining loans from banks. The developer does not always have personal savings, so he uses borrowed funds.

The developer is considered the responsible person for the approval of the project in various authorities and organizations. In fact, this person is involved in all stages of construction: from documentation to sale.

Important qualities of a developer

A developer must have the following basic qualities:

resistance to stress;
determination;
Analytical mind;
organizational skills.

Additionally, the developer requires skills in the field of organizational activities. The ability to find an approach is also not the last quality for a person in this profession.

Leadership qualities will also help the developer assemble a team of good specialists and properly organize the entire construction process. Life experience will help you select a good professional:

architect;
lawyer;
broker;
marketing specialist;
and so on.

To run a successful business in this area, you need the ability to firmly assess the state of the real estate market, as well as analyze current trends.

A specialist in this field must be able to make timely decisions on the reorganization of a facility in order to obtain greater profits, as well as competently organize the entire construction process. Therefore, the developer must be well versed in engineering and construction theory, as well as have relevant practice. The developer must have one of the higher education levels:

legal;
economic;
technical

Additionally, such a person must have knowledge of real estate, architecture, and transaction processing.

Functional responsibilities

What a developer does can be determined from the functions:

design;
business plan development;
purchase or lease of land;
organization and control of construction;
organization of an advertising company;
sale or lease of a constructed object for the purpose of making a profit.

The developer can act as an investor himself or attract investment from outside.

When choosing the second option, he receives a certain amount of royalties for his work.

To perform the work more efficiently, the developer creates a team of professionals.

Advantages and disadvantages

A good developer should have an excellent understanding of the following areas:

financial;
legal;
engineering;
construction

If we take into account this multi-profile profession, we can say that there are very few such specialists in the construction market. Accordingly, there is practically no competition here.

The developer profession has the main advantages:

high profitability;
lack of competition;
demand.

The disadvantages include the bad trends of recent years. they are associated with the crisis in the construction market. Also, the disadvantages include everyday stressful situations due to difficulties in work. Just at the beginning of the project it is necessary to collect several hundred signatures from various authorities. The lack of practical experience of a developer can lead to large monetary losses that exceed the earnings of this specialist.

Development is a business activity related to the creation and development of a construction project. This is a relatively new name in the real estate market.

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Who is a developer, what does he do and what is a development company? Developers: who is this in simple words, what does a development company do? What does a development company mean?