Jones Lang LaSalle recently asked: Is there still room for the buccaneer property developer?
But in the contemporary world of real-estate – corporatized, institutionalized and massively capitalized – is there any longer room for the swashbuckling “merchant developers” or are they doomed to go the way of the wildly-gesticulating floor traders in colourful blazers that once symbolized financial markets?
“There is always room for the entrepreneur,” says Richard Bloxam, JLL’s head of capital markets, Europe, the Middle East and Africa. “It is, however, fair to say that real estate has been on a journey away from total reliance on the entrepreneurial model.”
I’ve written about the institutionalization of the business before. And it’s something I’ve been asking developers that I interview for my BARED blog series. Are the days of the eccentric and larger than life developer behind us?
The consensus appears to be no.
All that has changed is the capital source / stack. The skills that make for a successful developer haven’t changed. You still need to be creative and look for opportunities that others don’t see. You still have to navigate through all of the various constraints – of which there is probably more of today. You still need to be entrepreneurial in spirit.
What I wonder though is if this change hasn’t undemocratized the business to a certain extent. It seems to me that it’s harder, today, to fly by the seat of your pants with just an idea (and no capital). The barriers to entry feel more significant. But as Richard says, “there is always room for the entrepreneur.” And I believe that.
I would be curious to hear your thoughts.
Also, the next BARED post will be up shortly. Stay tuned.