Measuring Success in Real Estate Development
At Buckingham Companies, success in real estate development is measured at every stage of the project lifecycle. From securing land to overseeing construction and lease-up, each phase is critical to ensuring the overall success of a development. Gabrielle Rubenstein, our Director of Investments, highlights how Buckingham’s detailed approach allows us to consistently deliver high-quality projects while learning and improving along the way.
1. Acquiring Land at the Right Basis
The foundation of a successful development begins with acquiring land at the right price. Gabrielle emphasizes the importance of this step:
"How I would measure our success would be from multiple stages of our project. In the beginning, making sure we're getting land at the right basis."
By securing land at a favorable price, Buckingham ensures that the project is financially sound from the outset. Acquiring property at the right basis allows for flexibility throughout the development, giving us the ability to adapt and maintain profitability even if unexpected challenges arise.
2. Navigating the Entitlement Process
Before any construction begins, the entitlement process can present significant hurdles. These involve securing zoning permits, approvals, and other regulatory requirements, which can vary greatly depending on the municipality.
Gabrielle explains:
"As we're going through our development process of getting entitlements, what are the challenges that we see there, and how we're able to overcome them?"
Buckingham’s expertise in working with local governments and understanding their preferences allows us to navigate these complexities effectively. Learning from each project helps us improve our approach for future developments, whether that means adjusting rezoning strategies or allowing more time for certain approvals.
3. Staying on Target with Construction
A key measure of success in real estate development is staying on budget and on schedule during the construction phase. Gabrielle points out the importance of monitoring progress closely:
"As we're building, are we keeping our construction numbers on target? Are we running into things that we didn't anticipate?"
Unexpected challenges—such as the need to build new infrastructure or bring utilities from further away than planned—can arise during construction. However, Buckingham’s vertically integrated model allows us to adapt quickly and keep our projects moving forward. This ability to manage costs and timelines efficiently is essential to delivering successful developments.
4. Lease-Up Velocity and Rent Performance
Once construction is complete, the next major focus is the lease-up process. This phase is critical in determining how quickly a project fills with tenants and whether rental rates align with financial projections.
"Once we've delivered, what's our lease-up velocity? Are rents hitting pro forma?" Gabrielle explains.
At Buckingham, we track these metrics closely, using real-time data to assess whether our developments are meeting market demands. If adjustments are needed, we respond swiftly to ensure that we optimize occupancy rates and rental income.
5. Learning and Improving for Future Projects
A key aspect of Buckingham’s approach to development is using each project as a learning opportunity. Gabrielle highlights how these insights help shape future success:
"We may learn something new about the market in construction that either we have to increase costs or decrease that I need to factor in the next time, or something we learn about a municipality and what they like and what they don't."
By analyzing past experiences—whether it's lessons about a particular market, construction costs, or navigating municipal processes—we refine our approach for future developments. This continuous improvement mindset helps Buckingham stay ahead of the competition and ensures that each new project builds on the success of the last.
6. The Advantages of Vertical Integration
A major factor in Buckingham’s ability to manage and measure success so effectively is our vertically integrated platform. Gabrielle highlights the benefits of this structure:
"Having a vertically integrated platform makes my job so much easier because there's so many factors that go into whether a site will work... Being able to go walk down the hall and get updated construction numbers... makes it so I can easily make those investment decisions."
With development, construction, and operations all under one roof, Buckingham can make informed decisions quickly. This seamless collaboration allows us to adapt to changes—whether it's recalculating costs or modifying plans—without delay, ensuring that we stay on track.
Conclusion
Measuring success in real estate development at Buckingham is a multi-layered process that involves careful attention to detail at every stage. From land acquisition to construction oversight and lease-up performance, we take a holistic approach to ensure each project is delivered successfully. Our commitment to learning from each development, combined with the advantages of our vertically integrated model, sets Buckingham apart as a leader in the industry.
As Gabrielle Rubenstein outlines, Buckingham’s ability to adapt, innovate, and execute allows us to continuously improve, ensuring that we not only meet but exceed our development goals project after project.