Beware The Invisible Property Developer

What does a small-scale property developer look like? Ask around, and you’ll get many different answers, but there are likely to be some common themes. Wealth will be a common one, as very few people have heard of a poor property developer. There may also be a mention of nice cars and perhaps something about a well-tailored appearance. And of course, they’ll live in a lovely house, even if it probably isn’t one they’ve built for themselves.

The reality is, of course, nearly always a little different from the perception, but equally, there’s more than a grain of truth to the stereotype. But who really cares how property developers are perceived? The answer, it turns out, are property developers themselves. Or at least they should do. Let me explain why.

The first thing to understand is that most property developers don’t build houses. This may sound a little controversial given that a cursory look at any developer’s website would suggest otherwise, but for the most part, it’s true. The reality is that developers cause houses to be built, which is somewhat different. This may sound like I’m trying to be clever, but the distinction is important. The developer is the catalyst that makes a development project happen; the entrepreneur who pulls together a team of people with the relevant skills to build something that will make them a profit. I’ve worked on hundreds of development projects but have yet to lay a single brick or prepare a single set of drawings. I’ve not even chosen any curtains (at home OR at work, come to think of it). The point is that it’s the team of professionals that work for the developer who builds the houses. The developer simply creates the environment for the project to happen, and they also take the financial risk. And that’s why they receive the lion’s share of the project’s profits.

Another critical piece of the development jigsaw is the role played by the project manager. For those who have only done refurbs, flips, and HMO conversions, you may not have had the luxury of having a PM run your projects for you. In fact, you may well be thinking that YOU are your own project manager. But step one rung up the development ladder to a small conversion project, and you’ll suddenly be able to afford both a main contractor and a professional project manager to run the show. This immediately elevates you from a hands-on middle manager to a boardroom position. Now it’s your project manager who’s running the operation. They’ll be visiting the site regularly and then updating you by phone on progress. Of course, you’ll still need to make decisions on a few things as you go along, but the reality is that you can deal with most issues remotely through your PM.

And herein lies something of a problem, or at least a missed opportunity. You see, in my experience, most developers fall into one of three categories:

  1. The Invisible Developer

Conspicuous only by their total absence on-site, these developers like to keep away from the action. Building sites are not really for them, although they might risk a sneaky drive-by after hours when everyone’s gone home. They simply get the project manager to sort everything out then ask for the keys when the project’s finished. And, of course, they’ll bank the profits once the units have been sold. But other than that, no one apart from the project manager has ever really seen them. Do they even exist?

  1. The Executive Developer

Occasionally found on-site, often sporting suspiciously clean boots, a reluctantly borrowed hard hat, and giving off the distinct impression that there might be a Range Rover parked somewhere nearby, these developers are straight from the C-Suite. You’ll know when they’re on-site because the top brass from the design and construction team will also be there. In fact, these are the only people that the Executive Developer ever talks to. The sub-contractors and construction team who are physically building their projects are somehow totally invisible to them. It’s the construction industry’s equivalent of a royal visit minus (most of) the bowing and scraping and with fewer corgis.

  1. The Hands-on Developer

Regularly on site, these amiable souls are known to everyone. They take the time to talk to the people on the ground as well as the top brass and take an interest in what’s going on. They’ll often bring in a box of doughnuts for the team and have even been known to do a run to the coffee shop. They’re also keen to make sure that everyone is happy with their lot and that any minor grievances are sorted out. You can still tell they’re the boss, but they seem to have the common touch.

Now, you’re probably all thinking the same thing. Which is, if you were a developer, you’d love to be known as a Hands-on Developer, but the sheer fear involved in imagining an encounter with a group of experienced and opinionated construction workers means that instinctively you’d much rather be the Invisible Developer. Unfortunately, this conflicted position invariably means that you end up looking like an Executive Developer which is arguably the worst one of the three.

Now, you might ask why is this a problem? After all, everyone has their role to play, and you don’t need to be everyone’s friend. At the end of the day, you’re providing gainful employment for many people. You’re not looking for gratitude, but by the same token, surely you don’t need to talk to them all? Which is where you could be missing a massive trick that could cost you a pretty penny.

Construction at its base level is simple stuff, bringing a range of not very sophisticated materials together and assembling them in such a way that they stay assembled and don’t let in the rain. It’s not exactly high-tech. But construction is full of problems. Mercifully not usually of the call-the-bank-manager variety; I’m talking about the minor issues that crop up day-to-day. For example, where the architect’s drawings don’t appear to be entirely compatible with the laws of physics, or where some nasties have been uncovered which require some head-scratching and an ingenious workaround. These things are daily occurrences on construction sites. And guess who sorts them out? As the developer, you won’t be called on-site to opine. In most cases, the project manager or the site manager won’t even hear about them either. And that’s because these problems will be solved by the construction team who are physically doing the work. It’s a massive part of their skillset since if they didn’t do it, construction sites would grind to a halt every other hour.

Most of these minor problems have more than one solution. And very often, it comes down to a cheap/quick solution versus an expensive/time-consuming one. If the person in question can implement a quick and easy workaround that gets the job done, there’s no extra cost increase or time delay. If they can’t (or won’t), then it means more money and extended timelines. Which is usually zero amount of skin off the nose of the people working on your site; in fact, the more expensive solution might make life easier for them. But it can make a massive difference to you as the developer.

So, you’ve already guessed what you need to do; you need to engage with your team on-site so that they don’t perceive you as a snooty, aloof Range Rover-driving snob.

Basically, you need to force yourself to be a Hands-on Developer. Make a point of speaking to everyone on your project. Go to the site regularly and see what’s happening. You’ll not only learn a lot, but you’ll also be a feature on everyone’s landscape. And when your team encounters a problem, they’re much more likely to be inclined to find a cheap or quick solution, even if means they have to put in an extra shift. For the distant Executive Developer who doesn’t lower themselves to even speak to them, you can probably guess what happens – a bigger bill AND a longer project; that good old time and money combo.

This problem usually doesn’t come about because property developers are bad people. Instead, the role of Executive Developer is created through fear. Let’s be honest, a building site full of workpeople will appear quite intimidating to the newish developer who hasn’t got as many miles on the clock and who quite possibly has little in common with most of the construction team. And, because they’re the boss, they get to choose whether they engage with the team or stick like glue to the PM, the architect, and the site manager, all of whom they’ve met before. It’s the easy option, where they don’t risk being ridiculed. But you come across as arrogant and aloof, which doesn’t endear you to anyone (and may explain why you’re forever picking off dollops of cement from your Range Rover’s roof after a site visit).

But fear is always exaggerated. About ten-fold if you believe the experts, which is why the new developer’s fear of being awkward and embarrassed if they talk to people on their own construction site is way off-beam. Sure, you’re going to be an item of curiosity because you’re the grand fromage. But if you make an effort to engage with people, you’ll quickly find that two things happen. Firstly, you’ll get a lot of respect. People appreciate that you’re the boss, and if you also talk to them like human beings and respect what they do, you’ll usually get a lot of respect back. Secondly, you’ll learn something – in fact, lots of things – and that will make you a better developer.

So, how do you fend off your inner demons and venture down the Hands-on Developer route? My advice to new developers is to be a new developer. Don’t try and look like you’re an old hand; you’ll soon come unstuck. Be honest and appreciative of the great work your team is doing. Oh, and don’t turn up TOO often.

And if you remember to bring doughnuts with you occasionally, you’ll find yourself a very welcome visitor indeed.