DEVELOPMENT MANAGER - PROJECT MANAGER - SUPERINTENDENT
A lot of people often assume that the role of Development Manager, Project Manager, and Superintendent are all the same, or are interchangeable. Tomato vs Tomahto … same, right ? … far from it.
The confusion becomes even greater when various industry professionals use these three terms interchangeably in their communications to the public. Creating further misinformation and lack of clarity.
On the surface, the three roles may appear very similar to the untrained eye. Time and time again we’ve seen clients who engage a project manager or a superintendent expecting for this person or company to deliver the entire development outcomes from start to finish. Often with disappointing results for both the client and the project manager/superintendent. The client may experience disappointment because the development did not deliver the overall results the client was expecting even though the construction part of the project was completed on time and within budget.
In this article, we will explain how different the three roles are and when to engage them appropriately.
Superintendent
Usually engaged by clients on medium to large projects. Their role is to run day-to-day operations on the construction site and control the short-term schedule. The role may also include quality control and subcontractor management. Most construction finance-related items and overall schedules during construction are managed by a project manager.
Project Manager
Usually engaged by clients on medium to large projects. Their role is to manage and deliver specific outcomes within specified budgets and timeframes across the entire construction part of the project. We often see project managers being engaged by clients at the construction stage of small developments to help manage the build on behalf of the client. With no fault of their own, project managers have a very narrow focus due to the nature of their role. That is, to manage the builder, building contracts, construction drawings, project specifications, construction program, costs, and possibly a tender process. They often do not consider the type of project you should embark on in the first place, what property to buy for development, develop project feasibilities, manage the design, obtain approvals and permits, consider suitable legal and taxation requirements, set overall budget for the entire development project while considering expected sales to ensure you generate the required results you are after from your development.
Development Manager
Usually engaged by clients on projects of all sizes. Their role is overarching across the entire development from start to finish. Understanding your overall goals and returns you want to achieve from the development. Creating a strategy on how to achieve these goals by working backward from the end outcome. Considering all matters relating to the project; from development feasibility to financing, appropriate legal and taxation requirements, site identification/acquisition, design, town planning, obtaining approvals, builder tender and appointment, project budget, cash flow, marketing, and sales.
Experienced Development Manager understands intricate relationships between each part of the development process. How every decision has an impact on other parts of the project whilst ensuring the overall development is delivered to the desired standard, achieving a commercial outcome, on budget, and on time. Balancing project outcomes across all areas of the development, and not just one or two. On smaller projects, an experienced Development Manager often will replace a need for a separate Project Manager and/or Superintendent if required.
The decision whether you should engage an experienced Development Manager will heavily rely on not only the size of the project but also on your level of experience in managing and completing development projects in the past of similar scale, budget and location.
For example;
We were contacted by a prospective client who with previous help from his financial planner and accountant, purchased a property for development purposes. When the client contacted us, he was already heavily committed to their project both in time and in money. The client engaged various professionals at significant expense to obtain plans and permits for the development. He wanted us to review what he achieved thus far and to help him with the next stages of the project. During our discovery consultation, it became very quickly apparent that there is a major problem with his development that needs to be addressed and resolved before he continues any further. The client purchased the property in his personal name and all expenses were paid from his personal bank account. Four things stood out to us which we brought to client’s attention;
All assets under client’s personal name could be at risk should he be litigated in relation to the development
All profits from the development would be added by default to client’s personal income, resulting in client being possibly assessed at the highest income tax rate
Lack of GST registration by the client would mean he may not be able to claim input tax credit to offset GST payment due to ATO upon sale of the completed development
The property may be considered as improved because the client obtained plans & permits. Meaning the client may be required to pay stamp duty if he now decides to transfer the property into a corporate structure or a trust to mitigate the previous three points
All of the above challenges could have been easily avoided if the client engaged an experienced Development Manager at the beginning before he even purchased a property. Sometimes the expenses required to mitigate the above problems this late into the project may result in the development no longer returning the financial results the client was expecting and may possibly require for the project to be disposed of in order to start again. Experience gained but time and money wasted.
At Tophat & Mayfair, we are in a unique position to deliver exceptional client experience across the entire development cycle because we are experienced working across all of the above three roles. In addition to being an experienced Development Manager, we are also a registered builder which puts us in a unique position, because we understand the intricate details your builder may face during the project allowing us to minimise potential risks and quickly resolve any problems that may arise during the development. Protecting against possible erosion of your anticipated results.
If this is something that interests you and you would like to enquire more about, feel free to contact us at TOPHAT & MAYFAIR for an obligation-free 30 minutes consultation.