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Common development issues

On Behalf of | Jul 24, 2023 | Real Estate

New construction and real estate development bring opportunities for employment, additional housing and local economic growth. Development also poses unique challenges. For those new to the industry, development issues can catch you unaware.

The more you understand about common challenges, the easier it is to prepare and combat them.

Zoning laws

Zoning laws govern options for land use, including restrictions on commercial and industrial facilities in or too close to residential areas. Before investing in property, confirm the zoning status, including any restrictions and potential variances. Rezoning property requires petitions and potential litigation, so it is often best to choose property already within your parameters instead.

Contractor issues

Developers depend heavily on contractors for construction. Contractor issues can derail project timelines, costing you delays. Common contractor issues include working with untrained staff, shortcuts in materials or project completion and miscommunication about guidelines, expectations and deadlines. Choose a contractor you trust with a proven track record for reliable, consistent and quality work. This reduces your risk of contractor-related challenges on the job.

Investor problems

Most developers rely on investments and outside funding sources to complete projects. When an investor delays payments or decides to pull out of the deal, it can disrupt your development plans and delay project completion. Communicate with your investors regularly and address concerns or questions right away to reduce the risk of issues.

Understanding common challenges for developers makes it easier to proactively reduce your risk factors. Consider these points as you plan your development project to improve your chances of success.