In order to get a commercial real estate development project approved, there is a lot of...
The Real Estate Development Process
Business owners are experts in their craft and problem solvers by nature - manufacturers specialize in industrial production. Doctors focus on treating patients. Auto mechanics enjoy fixing cars. Many don't have the expertise or the bandwidth to develop a new facility themselves.
Here's how development normally works for a business that plans to owner-occupy their space:
Project consultants work in silos of limited expertise and deliver services according to their priorities. Each trade serves its distinct role - contractors focus on building, architects on drawing, civil engineers on site design, and the list goes on... but there isn't an expert with knowledge of every function.
And this misaligns incentives - business owners are left trying to figure out how to develop the property themselves while also running a business. The real estate development process has for too long left small business owners behind.
So, we're flipping the script on that and turning the traditional owner-occupied small business development model upside down.
Marsh & Partners instead takes a proactive approach to development by managing every aspect of project execution and delivery. We're developers ourselves - so we have the scale and supporting functions available to deliver a ground-up project from start to finish. That means business owners aren't left trying to learn and manage a process they may only do once in their lifetime. And they can instead focus on their value-creating activities and leading their businesses.
Here's how Marsh & Partners can help:
Pre-Development & Land Entitlement: Land planning coordination, design management, site plan & construction drawing approval, budget refinement & project management
Development & Construction: Construction management, budget & schedule refinement, and quality assurance
Post Construction/Closeout: Certificate of occupancy (CO) & project closeout services, management plan, & marketing and leasing services (if needed)
Aligned Business and Real Estate Strategy
Traditionally, small business owners make real estate decisions by default, through the course of their daily business.
It's not willful negligence on the part of the owner, but rather a symptom of leading a business in today's operating environment - owners have too much on their plate. They're often times playing the role of visionary, manager, CFO/accountant, salesperson, and chief marketer. It's already too much to handle for a single individual, and when you add in the complexities associated with real estate development, it's no wonder most owners default to the status quo.
But unintentional real estate decisions have major implications for business growth and productivity. A real estate consultant may be necessary to help businesses capture the synergies that come from properly aligned real estate.
So by helping owners shift from the mindset of treating their real estate and business as two standalone functions, Marsh & Partners is creating better owner-occupied results. Real estate development instead becomes an opportunity to align business operations, future company growth, financing, tax, and wealth-building implications.
And we're taking the burden of having to manage the process off the shoulders of owners. Project consultants (engineers, architects, surveyors, etc.) operate independently and rely on the project owner for constant oversight. A real estate consultant manages those disparate functions ensuring that the owner's intent is captured throughout the development process.
Marsh & Partners' services as a solution to businesses' real estate strategy needs:
More Efficient Space: Deliberate program analysis (interior floorplan and exterior site plan), design management, and space planning to better enable operations and optimize the facility (facility optimization)
Cost & Time Savings: Leverage relationships with engineers and project consultants for faster and more cost-effective service
Risk Management: Properly sequence due diligence and development milestones to avoid late-stage project setbacks and spending money out of turn
Focus on Your Business: Business owners avoid learning and managing the development process and can instead focus on their operations
How a Real Estate Development Consulting Project Might Work
Real estate development is becoming more complex, and municipalities continue to add friction to the land entitlement and project permitting process. Marsh & Partners enables business owners to focus on what they do best - managing, leading, and growing their companies.
Business owners don't have to manage all the moving parts and consultants related to a project - Marsh & Partners would be the owner's primary point of contact throughout the development process.
Here's how the real estate consulting process normally kicks off:
- An initial engagement to discuss the development project, client objectives, business & real estate strategy, and services
- Executed development proposal for retention of Marsh & Partners' services
- Real estate strategy refinement and a project timeline and action plan developed
- Project kick-off and weekly owner coordination meetings
- Marsh & Partners will manage and sequence all real estate due diligence tasks, timelines, budgets, projects consultants, municipal permitting and approval requirements, construction, and occupancy - ensuring the owner's vision is clearly articulated and delivered on throughout
- Projects are managed using a collaborative real estate development project management platform to keep the business owner updated on project timelines and milestones
When it comes to business planning and strategy, one of the critical questions is how long the project will take.
Every municipality is different, and depending on the size and scope of the development project you're proposing, the land entitlement and permitting process can vary greatly in complexity and time required.
It's wise to plan for at least 24-36 months to allow adequate time for everything from site selection through project closeout. A real estate consultant can help you contemplate and structure your existing real estate situation to best align with a development project's timeline requirements.
A Real Estate Consultant Delivers Quantifiable Results
The real estate industry isn't built to serve small business owners.
They're often not the most well-capitalized - cash is king in the world of small businesses, and large capital outlays for down payments sometimes aren't feasible.
They're makers and doers, not from the same world as the slick talkers in real estate - there is a natural divide between owners and real estate professionals.
And simply for lack of experience, they're not experts in real estate development. That presents major challenges when dealing with and managing the many outside project consultants that have a role in a ground-up development project.
In other words, there isn't a one-stop shop available for business owners to help them navigate the complexities of real estate development. Civil engineers handle the land planning and site plans necessary for a project. Architects are experts in building design and navigating building codes. General contractors are experts at handling subcontractors and making sure projects are built on time and within budget. Other project consultants may be experts in soil studies and geotechnical explorations or stream & wetland delineations and permitting.
So instead of the business owner being left trying to manage these disparate trades and run a business, Marsh & Partners will deliver the project according to an owner's priorities and vision.
Development projects directed by a real estate consultant are more likely to be completed than an owner-managed development, and provide several additional benefits:
- On average, an owner-occupied development is delivered 33% faster than when business owners try to self-manage the project.
- Owners avoid splitting their focus between the project and their business - frequently, a business's top-line revenue falls 10-15% during a self-managed project, which ultimately impacts financing and overall project viability.
- Businesses experience bottom-line growth as a result of more efficient real estate and an optimized facility.
- Lenders view real estate consultant-managed developments more favorably because the project carries much less risk for the bank.
- On average, business owners save 20% on vendor and project consultant fees resulting from Marsh & Partners' network of service providers.
- A ground-up development offers business owners the opportunity to craft their vision, leave a legacy, and simultaneously build personal wealth.
Risk management is a critical to the success of any real estate development project. Owners that don't sequence their real estate due diligence tasks properly, or don't adequately manage land entitlement risks often end up spending money unnecessarily either on bad advice or because of their own inexperience.
Mistakes add up quickly, especially when the future success of your business relies on delivering a development that meets your needs. Marsh & Partners will demystify the development process - saving business owners time and money, and reducing risk.
Does Real Estate Consulting Make Sense For Your Project?
We work with small businesses in diverse industries with varied firm revenue and employee headcount ranges. Clients include: manufacturers, healthcare and veterinary providers, restaurants and franchises, trade businesses, retailers, professional services, auto services, and service providers.
Should you reach out for help with your owner-occupied development project?
- You'd rather manage your contractors, engineers, architects, and all service providers by yourself
- You have a strong grasp of the real estate development process and are comfortable that you can get the project approved
- You've had frustrating developer or consultant experiences and assume they're all the same
- You can't afford to let your revenues dip as you develop your property
- This feels overwhelming, but you know developing is what you need to do, and want someone to guide you through the process
- You've had frustrating experiences with contractors and engineers in the past
- You're concerned about navigating bureaucratic red-tape to get your project permitted and approved
- You don't speak the same language as contractors or designers and can't get your vision across
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Schedule a Meeting
I'm always excited to chat with owners about their businesses. Whether they are growing, downsizing, evolving, or just reorganizing, having a solid real estate strategy is critical to achieving the optimal outcome. A real estate consultant can be the conduit needed to begin brainstorming on how to better align your tax, operations, growth, and wealth building through business and real estate.
Schedule a 15-minute introductory call with me to talk about your goals and how our unorthodox approach to real estate development consulting might be able to deliver you more value for your business.