Real Estate Development

Real estate development (aka property development) is the process of building new structures and modifying existing ones to increase the property's value. In general, that means developing the property into commercial or residential buildings—ranging from apartment complexes and multi-family homes to restaurants, offices, and retail spaces. Developers handle the project from start to finish: They plan, design, and finance the venture, as well as assemble a team to execute the plan. Once the project is completed, the developer usually sells the property to a real estate investor. If the project is individual houses, a real estate developer could sell directly to the consumer. While property development can be a particularly lucrative area of the real estate industry, developers face numerous risks and challenges that can derail projects—and profits.