I published Tips for Aspiring Commercial Real Estate Developers on Medium.
I published Owlstamp Visual Solutions, a Historical Printing Company on Medium.
For years, Michael Snedeker has secured and developed public and private real estate projects in the greater Boston area. Michael Snedeker serves as the executive vice president at Elite Building Corp in Waltham, Massachusetts.
A real estate construction and development firm, Elite Building Corp's principals have more than thirty years of experience in the industry. The company helps clients implement construction projects while providing construction and project management services from start to finish. To date, Elite Building Corp has completed a variety of projects that include an interior and exterior restoration of the UN Secretariat and the multi-purpose Cronin’s Landing development. A pedestrian friendly development, Cronin’s Landing successfully revitalized the downtown community in Waltham and was even featured in a Harvard Graduate School of Design case study. In addition to a 350-car underground garage, the site includes 281 luxury apartments and a restored Art Deco facade from 1928. In addition, Cronin’s Landing offers over 25,500 square feet of retail space. For additional information on Cronin’s Landing and other Elite Building Corp projects, visit www.elitebuildingcorp.com. Michael Snedeker serves as executive vice president of Elite Building Corp. near Boston, Massachusetts, and possesses extensive experience in commercial construction and real estate development. Credited with helping his Boston-area development firm grow from a start-up to a profitable business, Michael Snedeker is skilled at identifying and launching new developments. Aspiring development professionals looking for their first success in the commercial real estate field should follow these guidelines as they navigate their first project. Start with thoroughly researching the local real estate market and potential partners. Next, assess your financial resources and your credit potential. As you work on financing, ask any co-developers to commit to contracts. When firming up ideas, consider sticking with the easiest and smallest version of a development project, and avoid getting tripped up by unnecessary expansions. Your first project should be successful, and it also should serve as a learning experience for you as a developer. Expect things to go wrong and focus on learning how to fix inevitable hiccups in the process. Finally, work on a project budget and timeline as you search for a suitable site. Make sure to confer with the builder and any engineers or architects you’re working with regarding the potential of the development site before settling on it. Since 2014, Michael Snedeker has rendered professional guidance in the construction and development space. Based in the Boston area, Michael Snedeker helps commercial real estate businesses of various sizes formulate long-term development plans and business strategies, including advising on novel and cost-effective methods of construction.
Growing demand for housing and commercial real estate combined with a smaller pool of skilled workers and advances in construction technologies have boosted offsite construction. Unlike traditional construction methods, the bulk of offsite construction takes place in a factory. Offsite construction streamlines many aspects of the building process, thereby reducing shipping and hiring costs. By centralizing the building process, labor needs can often be reduced by more than half. Offsite or modular construction practices appeal to many developers, including those who are interested in working in multiple markets but want to reduce cost and maintain strict timelines. Recent studies indicated that 93 percent of surveyed professionals had used offsite construction methods on at least one project. This figure is expected to rise, as the offsite construction market is projected to grow by 6 percent over the next five years. Budget
The right commercial real estate developer should have a good understanding of how financial limitations will impact the financing process of the project. In fact, the developer should be knowledgeable about commercial finance and should be able to walk through the customer during each step of the process. Although most developers will simply refer their customers to the nearest bank or lender for financial advice, it is better to work with a professional developer who has extensive knowledge of financial planning issues. Service Scope The commercial real estate industry is fragmented with very little service standardization. In fact, most companies provide only a portion of services required for the completion of the entire project. They don't provide a comprehensive oversight which will allow their clients to disengage from the construction project and concentrate on other areas of their businesses. That is why you should hire a commercial real estate development firm that provides an end-to-end project management approach. This offers the benefit of a single contact-point project control and accountability. Image The developer should be prepared to help the customer resolve any issues if the proposed project is out of reach due to image problems. This could include postponing the relevant project for some time and assisting the customer with corrective measures such as an image change. In fact, appearance is very important to local and regional authorities. This can impact your project in a positive or negative way. To make sure that the required municipal approvals are granted, you should work with a developer that has a reputed image within your community. Industry Experience Whether you are dealing with a commercial property such as an office park, church, or medical office, each type of project has different requirements that the developer should meet. But all developers may not be able to meet such requirements. That is why you need to work with a company that has the experience, skills, and expertise to deal with all aspects of the project. It should meet the vision and financial restraints of the client. A company that is suited for one project, may not have the technical expertise to build a new facility. In fact, the right company should have the client's best interests in mind throughout the project. Development Many new commercial real estate developers learn the hard way that it takes highly specialized skills to complete a job efficiently. That is why you should always work with a reliable commercial real estate developer on the market. Does Your Real Estate Developer Have Financial Stability?
The security and financial stability of any commercial real estate developer that you choose to work with is very important to consider, just like understanding a little bit about their background. It is important to not involve yourself with a developer that has minimal financial security, or if they have a poor borrowing history with local banks. Once you understand more about the real estate developers’ financial history, and their stability in this industry, you can feel confident that the project they will be helping you with will be completed on time and will be up to your standards. What About Their Current Project Time Frames? It is important to understand the time frame by which developers were able to complete recent projects, just like finding out about their financial stability, because it can affect how soon your project will be completed which directly affects your bottom line. You need to know that your expectations will be met, and that they will be able to deliver the projects that you are hiring them to complete. One way that you can find this information is by speaking with current clients that they have, as well as previous ones, asking specifically about the project timelines that they had and if their delivery expectations were met. What Type of Professional Network Do They Actually Have? Developers tend to have a professional network of businesses and individuals that they work with in the development and construction industries. This would include attorneys, bankers, general contractors, subcontractors, architects, and engineers, along with other professionals that are integral to the real estate development process. You need to know that they have reliable business partners that can help them successfully and smoothly complete every project, information that you need to know before working with any commercial real estate developer. Do They Create and Maintain All of Their Documentation? Throughout the entire development process, you need to know that the developer will be using the proper documentation. From the authority approvals to land title documentation, they need to use these documents which are needed for maintaining and managing each project they are on, allowing them to successfully finish each project, complete with all legal documentation. What Does Their Portfolio Look Like? You need to look at all their past projects, if possible, if you are thinking about hiring a local developer. You need to know that they have a history of successfully completing projects, as well as maintaining their financial stability in a way that will exceed your expectations. By putting in the time to find this information, prior to hiring a developer, you can influence the outcome of your project, allowing you to weigh the odds in your favor of having your project completed on time. 1. Use Contests
If you are after exposure or network engagement, running contests on social media is a good solution. Posting a contest on Twitter or Facebook will expose your brand and at the same time, it will engage your audience. A golden rule to keep in mind when running contests is to keep the contest structure as simple as possible. For instance, ask simple questions that require a one-button click to answer (such as choosing between colors/color schemes or even photos). It gives your network a chance to voice their opinion while reducing the amount of time needed to make a response. The good thing about contests is that you can use the results in subsequent marketing. 2. Offer Deals Exclusive to Your Social Media Followers or Give Your Followers A Chance to Win Everybody loves free things or a good deal. You can use this innate human behavior to boost your social media presence and your business. For instance, you can offer savings or even give gift certificates in exchange for liking and sharing your page. 3. Keep Your Network Up-To-Date on Your Latest Projects Due to the humans being curious, people want to know what is happening around them. As such, when you have new projects, keep your social network up-to-date. Some are interested in opportunities you may offer, so post any opportunities you may have. Additionally, share the benefits that your project will yield to the community. Also, include information about the un-served or underserved market your project will fill. In a nutshell, make your posts relevant to your audience. 4. Make Use of Videos For the most part, videos are inadequately used. However, as a medium of communication, they are very effective. People are drawn to watching videos as they are more interactive and better for content consumption. As a testament to their effectiveness, HubSpot reckons that in the real estate industry, listings that were accompanied by a video received up to 403% more inquiries when compared to the listings that did not have a video. Take full advantage of the power of video and include short clips of your new projects. As a golden rule, keep the videos succinct with the aim of putting your message across in just one minute. Alternatively, use Facebook Live. 5. Do Not Forget About LinkedIn As a social media platform, LinkedIn is an under-utilized platform. Do not make this very mistake. Grow your presence on this platform and use it for both marketing and professional networking. If you were to research the various investment platforms available to you, you would find many important advantages about the commercial real estate market. The big advantage is that the rental returns can be considerably higher than those found in the residential sector.
The income returns you can expect from commercial properties falls within the range of 7 and 9 percent each year. Compare this to the 2 to 4 percent found in the residential sector. These statistics are taken from Norwest, an NSW Commercial Agency. The best way to begin improving the amounts you collect from your commercial rentals, you may consider allocating your resources in those rental sectors in high demand. This will requires keeping an eye on the market and an understanding of the underlying trends that can influence these values. Identifying market trends One of the most successful sectors of the market is tourism which has been on the rise and a smart investment option. There are always sudden booms in tourism in the Boston area due to various events and being a great sports town is a huge plus as well. Savills Q1 2015 report stated that because of this over $1 billion in hotel assets changed hands within a period of 12 months. This has set a record for the Boston markets. Of course, it didn’t take long for the investors to begin getting in on the action. Today’s backpacker inns and hotels are being bought up at record breaking prices. Another important trend that is contributing to the favorability of the market is large-format retail properties. Diversify your portfolio With the fluctuating Boston market, it is a good idea to keep your investments diversified to mitigate the harshness of any negative impacts. Commercial property can include industrial locations, offices, retail outlets, malls and even retail agribusiness. Specialty properties and even medical and retirement living solutions also fall into this category. Heathley Asset Management, a successful commercial investment company, did this very thing, they sold off a four office and industrial properties to achieve a $65 million bid that would buy them into the health and medical industry, Heathley Asset Management’s head of property, George Websdale, had this to say “Over the past few years we have increased our involvement in the medical and health sector and will continue to do so into the future as we take advantage of the valuable solutions and free up our resource tied in the industrial and office sector.” Anticipate market peaks and troughs While, the most important factors in commercial investment are not capital gains, you can still find some important deals that will provide this type of growth. To do this it will be essential to study the market and look for the highs and lows that indicate where your growth lies. Be tenant-savvy In addition to the demand being made for the hotel sector, we also see a rising number of investment opportunities in the childcare sector as well. These have a very high initial demand, and this can lead to strong returns. |
AuthorThroughout his career in Commercial Real Estate, Michael Snedeker has demonstrated a dual commitment to production and client service. Archives |