I know titles across in our industry are weird but I was wondering if there are any "Development Managers" here. Wondering what your day to day is specifically, and how much you would be involved with the financial underwriting side pre acquisition and how much of the entitlements/construction phase you are involved with. Are there other areas you have your hands on too?
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Used to have a job title of Development Manager. Day to day my responsibilities were 100% entitlement, design, construction & tenant turnover. By the time I got to the deal, it was financed and underwritten. About 50% of the time we still had to identify and/or acquire the dirt for the deal, and on rare occasions the equity or debt partners would bow out at the 11th hour, but other than present the program, design & cost projection, I did not have any opportunity to get involved in the finance side.
At our shop the DMs' involvement in the acquisition/underwriting phase involve providing current construction pricing and once acquired they handle entitlement, bidding process, oversight of construction through to C of O then TIs if applicable. They don't typically get into the design or any part of the debt/equity side. Day to day they are usually doing one of the following:
-Onsite checking progress, issues, quality -At city turning in permit fees, coordinating inspections, etc -In the office reviewing any RFIs, plans, pricing, change orders -At construction meetings reviewing GC pay apps with work completed
The DMs here are involved through the entire process. Financing, due diligence, design, entitlements, underwriting, construction, ops, sale financing, etc. Very much the quarterback of the team. The only thing they don't manage is site selection and disposition, which is left to the regional SVP, but even then they're still involved in the process.
This hits the nail on the head.
Right on. When you say financing - are they talking to debt procurement guys and negotiating term sheets with banks? I guess if you area big enough shop you have an actual role for that but maybe not at smaller shops. What about interactions with investors - that too? I think this is very valuable especially if you aim to set up on your own in 10-15 years or something.
Not as much. When a big equity partner stops by, they'll walk them through the projects, but there is an Asset Management team as well as upper management. They deal a lot more with capital.
Yes. CRE above has got it--DMs cover everything. Some detail by deal phase: 1. pre-acquisition: back of the envelope site screening; due diligence including environmental, title, cost estimating with contractor, creating project budget etc.; detailed underwriting; land use counsel interaction to determine development potential; JV negotiations (if applicable); authoring investment committee memo for transaction 2. Entitlement post-acquisition: securing zoning approvals with local jurisdictions; SD/DD/CD phase design; contractor pricing; vendor management/requisition processing; leasing & marketing; construction scheduling; regular investor reporting 3. Construction: securing construction financing; GC bids/contract negotiation/strategy; interface with CM team to manage construction issues/problems; regular investor reporting
This is a good breakdown. Just to add to OP's question - we have DM's that are strictly focused on phase 1 and 2, and DM's that are solely focused on the construction phase.
I suppose a "Phase 4" would include leasue-up, refinancing or disposition - but from my experience "Development Managers" (in the formal sense) are not really taking the lead on that.
We do everything from site selection, due diligence, underwriting, entitlements, hiring consultants and managing them, construction admin, bank draws, and lease up. Handle all contracts, manage all utilities, pick out all finishes, coordinate plans, etc. Basically, as mentioned above you are the quarterback and everything is going through you to get the development done.
This is also going to depend on your size of your firm also though. I know other DMs who only handle the entitlement phase. They have entire teams who handle the acquisition, the financing, and the construction for them.
If someone wanted to start out at a big name brand developer first (that most likely has dedicated teams for every part of the process) but ultimately wants to run the whole process (probably at another, smaller firm) would it be better to start on the acquisitions/deal team or be a development manager that takes the handoff from the deal team?
My gut is telling me to try to do both since you'll need to know both anyway, but is it perceived as being easier transitioning one way or the other? Like being an acquisitions guy at JBG then moving to their development management team or vice versa? Just an example because I know JBG separates functions.
It won't matter. Focus on doing well at your task and learning as much as you can. Chances are, whenever you start getting more into the other side, you'll have a counterpart who will be doing the same for you side.
Sounds like my kind of job.
Is it better to be the acquisitions /deal guy or the development manager guy at a development shop?
I’m currently a development associate at a small developer, and my current responsibilities are underwriting, LOI and PSA execution, debt and equity raising. Once the deal closes, I hand it off to CM/DM. I came from a equity back ground. Is the next step for me a development manager role or is there always an acquisitions only guy at development shops?
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