Land Development - Past, Present & Future

Land Development - my upcoming series of blog posts will review industry components & discuss the changes since the 70‘s. I will offer many questions that should generate reaction, debate & action.

My intent is to review how the industry functioned during each of the past four decades and illustrate the significant changes and how it will continue to change.

As we come out of the great recession, how has our industry been changed?

Is the current positive data on housing prices and activity a false sense of security or a true recovery?

I will also strive to outline how the industry has changed due to “sustainability” being over used as an undefined framework for real estate development projects.  Or is it just a marketing concept? I will present changes and many questions that should generate reaction, debate and action. I invite you to read my past blog posts on real estate development issues.

 

 

Obviously, there are many communities which will promote sound development practices but many communities will swing the pendulum to restrict growth. Not only is our industry fragmented by location, market segment but also by representation. Buying, designing and developing land for all land uses is a specialty and our approach has significantly changed over the past four decades!  It is appropriate to ask at the beginning of my treatise:

Has the land development industry changed for the better since 70’s? True or False

As an overview with short statements for specific areas of expertise with a short True or False test will set the stage for my series of blog posts analyzing the industry from early 1970 to 2013:

Land – land is not being made any more and it is being taken off the market. Most “all” of the good land is gone. The success of a project is all in the land. Land prices did not reset as much as housing prices this recession. True or False
 

Due diligence and Acquisition – time is the issue. Assessing the characteristics of the land form has not changed but expanded. As the new norm, land owners will need to be partners in the process.   True or False
 

Design – creativity is a direct relationship with the economic development needs of a community. Design is not necessarily flexibility but envisioning a combination of uses. Or is it ‘what goes around comes around”? Will the cost benefit analysis be an after-thought? True of False
 



Regulatory – the most significant change in our industry over the past four decades is in regulatory oversight, regulations, politics, and the process. Government will demand more to resolve government issues than ever before. True or False

Stakeholders – this is a category encompassing the wide spectrum of those involved in the land development process. There is a long list of participants and I will focus on several key stakeholders. Has the general public become the most influential stakeholder in the land development process? True or False

Permits – without a doubt, the number of permits from local, state, regional and federal agencies has expanded over the years. While the industry has retracted over the past four years, government agencies have been hard at work creating more hoops and hurdles. True or False

Approval Process – there are over 80,000 municipalities in the country and the land development regulatory process seems to be always different. The process has and will become more complex, expensive and time consuming. True of False

Construction – in housing, the current supply is low and the demand moderate. The market is shifting. WHEN interest rates rise, what then? Are we in a new norm because construction companies and personnel will not be readily available to handle a surge in the market? Will government shift more responsibility to the private sector for long term maintenance of new construction? 

Project Success - real estate development is one of the last islands of entrepreneurialism affected by the forces of local supply and demand. Real estate development is an admirable business serving a social good but will it be worth the risk in 2013 and beyond?

General Questions for your Response:

If you build it, will they come?

Will national builders expand their market share?

Will commercial builders enter the residential industry?

Are there any regional developers left standing?

Will home building be profitable in the future?

Will government expand its role as a builder/developer?

Where did all of the construction trades disappear to?

Will liability and law suits break the back of the industry?

Etc…..etc!

“No person shall be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use without use compensation”

Without a question the real estate development industry has changed significantly and it is completely out of our control and influence – we let it happen to ourselves. Thus, I created the LinkedIn group, Real Estate Development eAssociation, as the primary voice of the industry. I encourage you to post your comments and opinions on my blog and within each LinkedIn group.