What Does a Developer Do in Real Estate?

Jared Eigerman

July 6, 2022

Jared Eigerman

You’re looking to get into real estate, you may be wondering a developer does in real estate. Developers work on large projects in real estate , such as apartment buildings or tracts of raw land converted to single-family homes. These projects are almost always backed by a group of investors, which can organize in several ways. A pure developer, for example, might be an individual operating a business entity or an LLC. In either case, the developer must raise substantial funding from outside investors to bring the property under contract.

Developing a property from start to finish

There are essential steps to follow when developing a property from start to finish. Most successful property developers follow the same steps. These steps begin with pre-purchase, move onto the concept stage, and conclude with completion. In completing a property from start to finish, a developer should consider the capacity of the purchase and make any necessary adjustments. An accountant should be involved in the decision-making process for this step.

In addition to hiring a development manager, it is wise to bring in a team of consultants to help with all aspects of the development process. The consultants should include architects, legal counsel, surveyors, engineers, and town planners. It is also a good idea to work with an estate agent to determine a property’s potential end values and readiness for the market. Finally, once the project is underway, a marketing campaign should generate interest in the property.

Negotiating with clients

When negotiating with a client, it’s important to be rational. After all, this is a significant investment. You shouldn’t make the seller or the agency lose faith in the deal if they’re confused. Making the negotiation process more accessible helps to understand your client’s priorities. You should also know theirs. If they don’t, you might end up backtracking on the deal.

If you have difficulty relating to your client, try to avoid going into a bidding war. Remember that you don’t have to win every battle – some sellers may want a mythical price, while others might only accept offers that put their clients in financial danger. It’s important to remember that you are working on behalf of your client, so remember to remind them if you think their offer is too low and walk away.


A construction loan is a form of debt financing for developers of real estate projects. Unlike other loans, construction loans require monthly drawbacks, which gradually increase as the developer draws more money. Generally, two loans are involved in real estate development financing: the short-term construction loan, used during the construction phase and the long-term construction loan, used to repay the construction loan once the project has stabilized and income has increased.

The traditional bank loan can take many forms, depending on the project’s phase. For example, a land loan can finance the acquisition of property land, while a construction loan covers construction costs. These loans are usually refinanced after a short time with another lender. Some financial institutions combine known as construction/mini-perm loans or construction-to-perm loans. These loans can last for three to five years and convert into equity in the development company.


For those interested in becoming a developer, the first step is to find a suitable piece of land. While some people own land ideal for development, others must find appropriate properties. A good tip is to look for a ‘dilapidated’ property in a high-demand neighborhood where the existing property is too expensive for an owner-occupier to restore. Also, while some people own suitable pieces of land outright, they do not have the capital necessary to complete the project.

While many developers undertake the entire development process, others will only provide the land and permits. Some will source the property, obtain the necessary licenses, and sell it to a builder. Others are also builders themselves and can immediately begin construction. Whichever type of developer you choose, communicate your expectations with your partner. By working together, you’ll ensure that the entire project runs smoothly. And don’t forget that you’ll be dealing with many different people, so check their references, and communicate your expectations well.


There are many benefits to networking as  a types of real estate development loans . This type of relationship-building can bring you a wealth of new contacts and opportunities. You can learn about local issues and concerns through these meetings. You can also respect your network contacts by accepting their invitations and recommendations. Here are some ways to network as a developer in real estate. To begin, learn how to network properly and effectively.

First, attend as many events and networking functions as you can. Networking events are an excellent way to connect with industry peers and other real estate professionals. Consider attending REB’s Women in Real Estate Awards, which recognizes top-performing females in the industry. Moreover, get to know other developers in your area by interacting at industry functions and events. Make a point to connect with other developers and investors.