Before you can begin the development process for any sort of building, land, or property, you need a strategy. A property development plan is key to achieving a successful development process and acquiring investors in your projects.
The Importance of a Property Development Plan
A property development plan is a long, multisection strategy that covers every single step of the development process.
While it may feel like a semester project, a property development plan is critical to maximizing the potential of a development project. Going into any project without a systematic process or a plan in place will cost much more than its end-profits.
How to Create a Property Development Plan?
A property development plan begins with a specific project. Several sections for each part of the process will be in a property development plan, in order to give potential investors a comprehensive look at your strategy.
What to include in a Property Development Plan?
A plan for developing the property will require the following detailed sections.
- Company information: The basic information about your company, structure, and overhead costs of running it.
- Personnel: What key roles and partners will work with you? Include any long-term legal personnel or consultants.
- Funding: Set the expending investments necessary, as well as how much you will be putting in. This is important for potential investors.
- Strategy: Describe the specifics about the property in question. Include information about the current or desired location, the current state, time period, the development you plan to undertake.
- Acquisition criteria: Explain what criteria that you expect is necessary to carry out the development strategy. For example, what construction is needed, what are the costs, what development opportunities types do you need, and so on.
- Exit Strategy: Will you buy-to-let and rent the property out to others, or will you sell property ownership?
- Construction Strategy: How do you plan on procuring and establishing a building plan?
- Financial goal or target: What is the goal return-on-investment you aim to receive? This figure will be a percentage as either Profit-on-cost, internal rate of return, or profit on revenue.
- Sales & Marketing Strategy: Set a plan for how you aim to sell and market the property.
- SWOT: This stands for the strengths, weaknesses, opportunities, and threats that you must assess the property in question.
Where do you start?
Start your property development plan with market research. Know the prospective clients and potential sources of funding. A property development plan will not only benefit you through your project, maximize your finding, and reduce costs and time, but it will also help you uncover your vision for a specific property.