Real Estate Development
As the world increasingly experiences urban expansion, the call to develop real estate that is sustainable and promotes social cohesion and environmental protection has become louder. To meet this challenge, many architects today are making the transition to real estate development, an endeavor often perceived to be reserved only for the wealthy. Though one certainly does not need to be a licensed architect to become a real estate developer, the element of design the professionals bring to the table must nevertheless be given prime importance.
In a nutshell, real estate developers execute their architectural ideas. They can be likened to the conductor of an orchestra. As the “director,” they work with architects, engineers, general contractors, and real estate brokers to see the development of a property come into fruition. As real estate developers carry all the high risk of developing a property however, it would only seem logical then that most would concern themselves to the business side of things. Unfortunately, this singular focus on profit has at times translated to the compromise of design; a mistake that can cost these developers more money than they anticipated.
One does not need to be a seasoned real estate investor to know that not all properties are created equal. With that said, how will a developer know then that he or she is not throwing away good money? How will a developer know that he or she is doing everything right in the development playbook? One way of finding this out is to assess the economics of design and the art in architecture, if design is not being relegated as an afterthought in pursuit of profit.
In this sense, real estate development and architecture are not all that different. Even, they are cut from the same cloth, as architecture provides the foundation for any building or structure to be erected. When developers forget the human element to architecture—that it can be a powerful tool to wellness and improving quality of life—they may find themselves building boring, boxy structures that stand little chance to stand out in the market.
Currently, there is a growing body of evidence that supports this thesis; that boring architecture in fact comes at a high cost. Some literature on this study include the books “Cognitive Architecture: Designing for How We Respond to the Built Environment” by Ann Sussman and Justin Hollander, and “Places of the Heart: The Psychogeography of Everyday Life” by Colin Ellard, and the work of psychologists Colleen Merrifield and James Danckert.
When this happens—when real estate starts to look all the same, no doubt developers will find their real estate agents at a loss on how to market the property. After all, the end game of real estate development is in the selling or leasing.
For more blog pieces about real estate by Brian Ferdinand, please stay tuned to this page.