Lately I've been doing research into the idea of an architect as a developer role. It seems to me after working with many clients that comes into the office, they don't really know a thing about the built environment. As an architect, shouldn't we be the ones who creates the city? I wanted to ask anyone who has thought of this or is currently doing this, what advice or resources would you give to someone who wants to get involved with this? I've looked into Jonathan Segal's program and many of his interviews. It seems very interesting.
baotloi: "knowledge of the built environment" is not - in and of itself - a critical skill for developers. Sure -- it would be nice if more developers had that knowledge, but compared to the need for skills in the areas of marketing, finance, law, leasing, property management, etc. (and the ability to integrate all of those disciplines) "knowledge of the built environment" is something they can hire us and general contractors to provide.
"As an architect, shouldn't we be the ones who creates the city?" -- sure, just as soon as we develop a strong working knowledge of marketing, finance, law, leasing, property management, etc. and a) can raise the money necessary to make it happen, and b) can stomach the risk that such activity entails, and c) can develop the managerial wherewithal to keep it all from spinning totally out of control.
Personally, I believe more of us "ought" to be become developers -- but, what we learn in architecture school and the typical design firm is woefully inadequate preparation for such a role. We need to understand -- and be able to control (with a high degree of competence) -- these other areas mentioned above.
Development is WAY more than just designing an attractive and functional building and then supervising the construction process.
development is controlled by two factors: planning policy and economics.
developers all want the same thing, to invest as little cash as possible to build out the largest allowable building type on a given parcel, to yield the highest gains.
In urban centers (LA, NY, Chicago, Seattle) this allows for good/sometimes great design because returns are much higher. In Segal's case, he can build out expensive residential and mixed use projects in SD and make that money back and some.
In the rest of the country (the middle) this isn't possible, development means shitty strip malls and cracker box apartment buildings. the money isn't there to do cool projects when you can only charge $500/month rent on some shithole.
Developers see architects as a necessary evil and if they could do without, I bet most of them would.
development is controlled by two factors: planning policy and economics.
Development is controlled by one factor: economics. Planning policy is generally locally consistent - economics are used to alter those policies on an individual basis (i.e. "planned development district" a.k.a. spot zoning, etc.).
In my experience developers are in general the de facto architects of the project, the licensed types simply implement their plans.
OP -- I'd encourage your interest. Think about one of the most important aspect of Segal's approach -- ownership. Also, get to a good real estate forum and start reading. Are you thinking of some formal education in this pursuit?
Found myself smiling reading about all the toil and worry of being a developer, kinda laughing as I write this.... architecture is infinity more difficult than development, speaking as the only one here that did both for 40 years. Architects are intelligent but not smart, there is a difference and if you're both you can make a killing. The idea that you need money just isn't true....I started with a $300. sign that I bought with a credit card... and the idea that low rents yield crap really isn't true.... get out there and prove it.
Don't be so quick to dismiss the concern about starting off capital-poor in today's environment. It is a legitimate concern. 40 years ago, it was much easier to start doing development on a shoestring than it is now. The world has changed considerably in the interim.
Gwharton, perhaps, but I did it for 40 years and lived with the change and things ebb and flow... after I retired in 2008 I wanted to build some spec houses (bucket list)... but without cash or risk...met with another builder to learn and he put me on to a bank... they ended up giving me $1,000,000 in cash, all I gave them was some plans, estimate and a financial statement that they never verified, all I did is sign my name and walk out the door... that wasn't 40 years ago that was 7 years ago.... it is possible, I'm not a wizard. Used to think that anyone could do this but most architects can't... too skeptical by nature, too cautious by education, that's the real obstacle not money.
architects are: "too skeptical by nature, too cautious by education, that's the real obstacle not money."
Correct there, Carerra... and I'd add on that (we) architects think we're too smart for our own good (complain about our lows fees, talk about our 'value' add lol, talk down to dumb construction workers) . However; I've learned more in 3 months working as a developer for my developer boss than I did sitting behind a computer the last 3 years drawing up plans and designing projects for clients - being the cog in the wheel - as an architect - a glorified designer. You don't learn a lot when your focus is only on design design design.... construction and real estate development are layers more complex than architects give credit to.
I became discouraged at the slow pace of learning in the arch office... layers of Architect 2, 3,..principal... waiting on years to have responsibility !! In the first 3 months, I've debated land use rights with city council members and mayors, negotiated with bankers, managed architects, engineers, ran meetings with numerous city works professionals, proformas, budget and learned marketing skills.
Whoever said it above regarding how more architects (should) get into development ... I second that. However, we need less useless designer-speak-nonsense in school, less theoretical bullshit and More finance, more negotiation, more construction mgmt, legal matters, lending, public process, business. What is it with architects hating business ? Everything is business. .. but the liberal design schools find money/business Taboo.
End Rant. But I'm happy with the transition and I highly recommend real estate development to those architects not getting fulfilled in their traditional architect role.
In 2008, you could still get zero-equity loans, and 10/90 LTV was even "conservative." By 2010, equity requirements had hit 60%, assuming you could even get a loan at all (which many people couldn't, particularly those just getting started). It's back into the 20% range now, but lending requirements are much stricter than they were seven years ago. It's very difficult to get serious financing right now if you don't have a track record or plenty of cash.
Funny, in 1969 when I tried to buy my first house no one could get a loan of any kind regardless of LTV and BTW interest rates were 4%...stopped everyone in their tracks but not me, I bought one on a land contact/zero down.. Around 1980 interest rates shot up past 16% and again everything stopped... learned of a metal building company who had a yard full of finished packages for sale at 1/3 value... again, got them to finance at 10% with 6 months deferred start of payments... bought two 100,000 SF warehouses and used their full value as my equity and borrowed from my bank at 16% to put them up... within a year the panic was over and I sold both at over 100% profit. Lending practices are not progressive escalating graphs... it climbs then crashes, banks are not the only source of financing and "stop" to you should mean "go".
Architects with an entrepreneurial spirit are becoming joint venture developers. It takes 6-Months of hard work and private mentoring in The REDI Foundation's Mentoring - Certification Program with Richard Michael Abraham. See the article in Reuters "New Breed of Real Estate Developers Worldwide." What was thought to be impossible is now possible for Architects.
Oct 24, 15 5:14 pm ·
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Architect as developers
Lately I've been doing research into the idea of an architect as a developer role. It seems to me after working with many clients that comes into the office, they don't really know a thing about the built environment. As an architect, shouldn't we be the ones who creates the city? I wanted to ask anyone who has thought of this or is currently doing this, what advice or resources would you give to someone who wants to get involved with this? I've looked into Jonathan Segal's program and many of his interviews. It seems very interesting.
Thank you!
Worth looking into: Cary Tamarkin.
baotloi: "knowledge of the built environment" is not - in and of itself - a critical skill for developers. Sure -- it would be nice if more developers had that knowledge, but compared to the need for skills in the areas of marketing, finance, law, leasing, property management, etc. (and the ability to integrate all of those disciplines) "knowledge of the built environment" is something they can hire us and general contractors to provide.
"As an architect, shouldn't we be the ones who creates the city?" -- sure, just as soon as we develop a strong working knowledge of marketing, finance, law, leasing, property management, etc. and a) can raise the money necessary to make it happen, and b) can stomach the risk that such activity entails, and c) can develop the managerial wherewithal to keep it all from spinning totally out of control.
Personally, I believe more of us "ought" to be become developers -- but, what we learn in architecture school and the typical design firm is woefully inadequate preparation for such a role. We need to understand -- and be able to control (with a high degree of competence) -- these other areas mentioned above.
Development is WAY more than just designing an attractive and functional building and then supervising the construction process.
Quizzical puts it beautifully. Development (as a professional field) is difficult and risky.
When we oversimplify it we demonstrate our ignorance, just as those do who dismiss architecture as effete or unnecessary.
development is controlled by two factors: planning policy and economics.
developers all want the same thing, to invest as little cash as possible to build out the largest allowable building type on a given parcel, to yield the highest gains.
In urban centers (LA, NY, Chicago, Seattle) this allows for good/sometimes great design because returns are much higher. In Segal's case, he can build out expensive residential and mixed use projects in SD and make that money back and some.
In the rest of the country (the middle) this isn't possible, development means shitty strip malls and cracker box apartment buildings. the money isn't there to do cool projects when you can only charge $500/month rent on some shithole.
Developers see architects as a necessary evil and if they could do without, I bet most of them would.
development is controlled by two factors: planning policy and economics.
Development is controlled by one factor: economics. Planning policy is generally locally consistent - economics are used to alter those policies on an individual basis (i.e. "planned development district" a.k.a. spot zoning, etc.).
In my experience developers are in general the de facto architects of the project, the licensed types simply implement their plans.
OP -- I'd encourage your interest. Think about one of the most important aspect of Segal's approach -- ownership. Also, get to a good real estate forum and start reading. Are you thinking of some formal education in this pursuit?
Thanks for the help guys! I'll keep looking into it!
Found myself smiling reading about all the toil and worry of being a developer, kinda laughing as I write this.... architecture is infinity more difficult than development, speaking as the only one here that did both for 40 years. Architects are intelligent but not smart, there is a difference and if you're both you can make a killing. The idea that you need money just isn't true....I started with a $300. sign that I bought with a credit card... and the idea that low rents yield crap really isn't true.... get out there and prove it.
Carrera,
Don't be so quick to dismiss the concern about starting off capital-poor in today's environment. It is a legitimate concern. 40 years ago, it was much easier to start doing development on a shoestring than it is now. The world has changed considerably in the interim.
just found out that I passed exam 6 of 7, one more to go and I'll be knee deep into this
Carrera: "... speaking as the only one here that did both for 40 years ..."
Well ... (clears throat) ... not exactly an accurate statement ....
Gwharton, perhaps, but I did it for 40 years and lived with the change and things ebb and flow... after I retired in 2008 I wanted to build some spec houses (bucket list)... but without cash or risk...met with another builder to learn and he put me on to a bank... they ended up giving me $1,000,000 in cash, all I gave them was some plans, estimate and a financial statement that they never verified, all I did is sign my name and walk out the door... that wasn't 40 years ago that was 7 years ago.... it is possible, I'm not a wizard. Used to think that anyone could do this but most architects can't... too skeptical by nature, too cautious by education, that's the real obstacle not money.
Carrera: You and quizzical need to buy Shuellmi and me a few beers so you'll both have time to explain your development methods.
Saint.... would like to but would be problematic, if you're reading the other forums you should know that giving free advice on Archinect is verboten!
lending in 2008 is completely different than today. in 2008 all you needed was a pulse.
Urban, you missed the part about ebb and flow, it will flow again, starting already.
architects are: "too skeptical by nature, too cautious by education, that's the real obstacle not money."
Correct there, Carerra... and I'd add on that (we) architects think we're too smart for our own good (complain about our lows fees, talk about our 'value' add lol, talk down to dumb construction workers) . However; I've learned more in 3 months working as a developer for my developer boss than I did sitting behind a computer the last 3 years drawing up plans and designing projects for clients - being the cog in the wheel - as an architect - a glorified designer. You don't learn a lot when your focus is only on design design design.... construction and real estate development are layers more complex than architects give credit to.
I became discouraged at the slow pace of learning in the arch office... layers of Architect 2, 3,..principal... waiting on years to have responsibility !! In the first 3 months, I've debated land use rights with city council members and mayors, negotiated with bankers, managed architects, engineers, ran meetings with numerous city works professionals, proformas, budget and learned marketing skills.
Whoever said it above regarding how more architects (should) get into development ... I second that. However, we need less useless designer-speak-nonsense in school, less theoretical bullshit and More finance, more negotiation, more construction mgmt, legal matters, lending, public process, business. What is it with architects hating business ? Everything is business. .. but the liberal design schools find money/business Taboo.
End Rant. But I'm happy with the transition and I highly recommend real estate development to those architects not getting fulfilled in their traditional architect role.
Pale, good to hear from you and your positive report.
In 2008, you could still get zero-equity loans, and 10/90 LTV was even "conservative." By 2010, equity requirements had hit 60%, assuming you could even get a loan at all (which many people couldn't, particularly those just getting started). It's back into the 20% range now, but lending requirements are much stricter than they were seven years ago. It's very difficult to get serious financing right now if you don't have a track record or plenty of cash.
Funny, in 1969 when I tried to buy my first house no one could get a loan of any kind regardless of LTV and BTW interest rates were 4%...stopped everyone in their tracks but not me, I bought one on a land contact/zero down.. Around 1980 interest rates shot up past 16% and again everything stopped... learned of a metal building company who had a yard full of finished packages for sale at 1/3 value... again, got them to finance at 10% with 6 months deferred start of payments... bought two 100,000 SF warehouses and used their full value as my equity and borrowed from my bank at 16% to put them up... within a year the panic was over and I sold both at over 100% profit. Lending practices are not progressive escalating graphs... it climbs then crashes, banks are not the only source of financing and "stop" to you should mean "go".
Architects with an entrepreneurial spirit are becoming joint venture developers. It takes 6-Months of hard work and private mentoring in The REDI Foundation's Mentoring - Certification Program with Richard Michael Abraham. See the article in Reuters "New Breed of Real Estate Developers Worldwide." What was thought to be impossible is now possible for Architects.
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