Is a property developer a builder?

Is a property developer a builder?

There is no rule that mandates that a property developer must be a builder or contractor, but they hire builders/construction contractors to construct buildings on the site they are developing.

A builder may eventually become a property developer as well because having robust knowledge is a plus, but not a necessity to become a property developer.

For example, when I used to run my construction company, I controlled all aspects of development in-house. I managed the development all the way from site acquisition, fundraising, permitting aka development approval and building approval and then handed over the construction to my business partners.

I then picked up the project again to settle pre-sales and close the project once everything that was built was sold or leased.

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Property Developer

Property developers focus on all the activities that make construction happen. From land acquisition, development finance, development management and eventually the sale or leasing of the developed units.

Builder / Construction contractor

A builder or a construction contractor, on the other hand, is focused purely on construction as their main activity. That is, they are handed over the project with construction issue drawings, and off they go to build and deliver.

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Development Management

As part of development management, a property developer hires an architect, engineer and other professional consultants to get everything ready for construction.

Construction Management

A builder is responsible for the actual construction & construction management of the project. The property developer contracts them to construct the buildings on the land that the developer has acquired to be developed.

Builders specialise in construction & are skilled in the various trades involved in building, such as carpentry, masonry, electrical work, plumbing and more.

They work with architects, designers, engineers and consultants to ensure that the building is constructed according to the plans and specifications and are responsible for managing the day-to-day activities on the construction site, including scheduling and coordinating the work of subcontractors and ensuring that the project stays on schedule and within budget.

Summary

In summary, property developer is not necessarily a builder, but they hire builders to carry out construction on their projects.

Builder-developer

Anyone can be a developer, but not every builder can be a developer.

Builder-developer is a term used to describe someone who is both, a builder and a developer. Typically, a builder-developer starts off as a construction contractor and eventually realises that they can be developers instead of working for a developer.

But not all builders can be developers, as being a property developer requires skills and an entrepreneurial streak, which very few builders have.

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