Property development is an exciting and rewarding industry to enter. Your project begins with an idea and the impetus to turn that idea into something physical, be it a residential, commercial, or an industrial property. The first step is learning how to write a property development business plan. This is how you lay out your plans logically and pave the way for a successful project. Without a business plan, the project may easily seem gargantuan; once you’ve written it down and broken it up into manageable steps, it’s easier to tackle.
What Is a Property Development Business Plan?
A business plan is a document which describes what kind of business you want to build, and it breaks down how you will go about doing that. When it comes to a property development business plan, the first misconception is that it’s set in stone. It is a working document which evolves as your thought process progresses, and you clarify each aspect of the project. It lays out the framework to get your thoughts in order and adjust them as you go.
What Does a Regular Business Plan Consist Of?
Writing a business plan needn’t be an immense task. In fact, many people recommend keeping it short and basic to begin with, and then fleshing it out where necessary.
A general business plan consists of:
- A page title and the contents of the document
- A summary of the document
- A description of your business
- A description of your product
- A market analysis
- A competitive analysis
- The general management of your business
- The financial aspects of your business
- Any necessary supporting documents
What is Different for Property Development?
A property development business plan is similar to a general business plan; it’s just more skewed to this particular industry. You will think more about the particulars of the property development industry. Your business plan will consider which aspects will affect your business that do not ordinarily impact other businesses.
Your property development business plan will cover:
- Your business’s structure, be it sole trader, trust, partnership, or company.
- Your funding strategy
- The type of property you want to develop
- Your development strategy
- Your construction strategy
- Where you want to develop the property
- How long the project will take to complete
- Your financial targets and returns
- Whether you are going to let or sell the property after completion
- Your marketing strategy
- Market research
Additional Considerations When Writing
Your property development business plan also needs to take into account factors such as who you are writing it for, is it for investors, third parties or banks? You need to speak directly to them and ensure that the plan is researched and convincing to investors. If you show your property development business plan to a third party, you may want to consider asking your reader to sign a confidentiality agreement.
Now that you have a clearer idea of how to write your property development plan, you can get going. Once it is complete, you can get on to the practical stuff, such as figuring out which property development software to use, finding the right property to develop, speaking to architects, and designing the ideal space.