What is a Com-Dev Company
Com-dev company is an abbreviation of commercial development company. This term is traditionally associated with the development of commercial real estate. A com-dev company conceives of a project and oversees it to completion. The firm must demonstrate the foresight to envision an attractive and financially feasible project. In executing the project, the management team must work with a wide range of third parties such as architects, local government, suppliers and construction firms.
BREAKING DOWN Com-Dev Company
A com-dev company handles the entire life cycle of a commercial real estate development project. The com-dev company is responsible for coordinating the efforts of a variety of vendors as well as working with outside parties such as local governments and financial institutions. Doing so on a repeated basis, under physical conditions unique to each project and cost restraints at every turn, requires an organized and systematic approach to project development.
A com-dev company is generally made up of specialists who manage the individual steps of a development project. Real estate market analysts seek out opportunities in undeveloped sectors. Planners, architects and engineers maximize the utility of a piece of land ready for development. Entitlement specialists work with local authorities to obtain permits and clear natural resource issues. Throughout the process, financial managers secure financing and control costs.
Com-dev companies operate within external and macroeconomic conditions that can bolster or hamper advancement of their projects. In recent years, for instance, a trend has developed toward urbanization and high-density areas containing both residential and commercial spaces. The rise of internet retail has minimized the need for big-box storefronts and allowed national retailers to set up shop within these condensed developments. Wage stagnation has made it harder for young people to purchase home, making the rental market more competitive. These conditions have led to projects converting suburban shopping malls into mixed-use, walkable urban zones often centered around public transit hubs.
The Four Phases of a Com-Dev Company Project
Each com-dev company follows its own operational practices, but many effectively adhere to a four-step process in developing a real estate project. First, the project initiation phase tends to begin with either a location, capital or idea, then seeks out the other two. The project conception stage follows, consisting primarily of a feasibility study to evaluate the legal and financial impacts of a project within a particular market. The com-dev company become a client in the project management stage, working with external architects and construction managers to convert an existing property according to project plans. The final phase, that of project marketing, should begin much earlier in the process and continue until a critical mass of occupancy has been achieved. This step also includes close coordination with an external marketing, generally a broker with an established business in the local market.