In today’s economy, a project requires vision, commitment and funding to make it off the ground. And when it comes to execution of these business essentials, entrepreneurs in every field can learn something from those in commercial real estate.

The feasibility factor

Before committing time and money to a project, a real estate developer takes steps to investigate all possible outcomes. Referred to as a feasibility study, the developer’s preliminary research covers all legal, economic, financial and technological factors.

The feasibility study is comprised of analysis of the market, location, usage concept, competition and risk involved in the project. Armed with that information in a written report, the developer decides whether or not to move forward.

Many new entrepreneurs dive headfirst into product development without making a true business case for the app, platform or service, only to be surprised later when costs skyrocket, regulatory hurdles arise or they face an unreceptive market.

Lesson: If you don’t analyze risks and market forces before you build, you’re setting yourself up to fail.

Proper planning

Once they decide to pursue a project, developers put all of the planning and coordination on their shoulders. That includes scouting and purchasing land, creating a project team, securing permissions and licenses, financing the deal and managing construction. All of that tends to happen over a short period, often just several months.

But despite the broad scope of those efforts, experienced developers typically juggle multiple projects at a time. How? Through realistic business and project planning. A developer drafts an initial pro forma plan as soon as he launches a project, revising it along the way. Even an informal outline helps keep the project rooted in timelines, budgets and goals.

Lesson: Map out objectives and strategies early on. Revisit them regularly to stay in touch with your progress.

Smart syndication

Commercial real estate deals typically involve a sophisticated financing structure including both debt and equity capital. The different types of capital are arranged in what’s called the capital stack — a structure which dictates the order of claims to investment returns…

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via: What Entrepreneurs Can Learn From Real Estate Developers