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Development Process Overview
Every development project proceeds through a series of phases, from the initial concept to final closeout. Although the terminology may vary from region to region, in general the development process can be organized into the following five phases:
A number of separate, but interrelated, activities occur within each phase. For the purposes of showing how specific phases of the design process relate to specific phases of the development process, the Design Advisor assumes the activities listed below occur over the course of an affordable housing development.
Please note that this in only a generalized list. The type, mix and sequence of activities may vary over the course of an actual development. For more comprehensive information, tools and resources addressing the development process, contact:
Concept Phase
- Establish organizational goals for the project.
- Determine type of project, potential location and target occupants.
- Consider sources of financing and how the project might be managed.
- Develop an understanding of community and local government support/opposition, concerns/needs.
- Evaluate site: cost and availability, technical and environmental issues.
- Visit and evaluate similar projects.
- Develop project vision and concept.
- Decide whether to explore the concept further.
- Outcome: specific use of a designated site for an identified market by a specific development team with a defined financial program.
Predevelopment Phase
- Apply for predevelopment funds.
- Conduct market study.
- Identify governmental/regulatory requirements.
- Select project team and define scope of work for each member.
- Review development concept with potential occupants, community groups, maintenance personnel, and other stakeholders and modify as appropriate.
- Identify sources of financing.
- Negotiate tentative or conditional financing commitments.
- Test cost assumptions.
- Obtain site control.
- Develop feasibility study.
- Outcome: analysis of all assumptions regarding market, site, operation pro forma, development pro forma, financial requirements, financing, team and roles, including suggested modifications for the concept to be feasible.
Development Phase
- Ongoing consultation between project team and the community.
- Prepare and submit financing/loan application.
- Secure permanent financing.
- Acquire property.
- Secure construction financing.
- Solicit and review construction bids.
- Obtain planning approvals, environmental approvals, if required.
- Obtain building and other permits as required.
- Outcome: all elements of project made definite. Letters of commitment, contracts and loan documents binding all participants to the specific elements of the deal are put in place.
Construction Phase
- Award construction contract(s).
- Initiate construction.
- Manage change orders.
- Negotiate certificate of substantial completion.
- Initiate marketing and lease-up, including outreach within the community.
- Manage construction close out.
- Conduct open house for community participants, press, etc..
- Outcome: completely built, leased/sold building, passing all inspections.
Operation Phase
- Staff up.
- Occupy.
- Provide services.
- Operate.
- Continue communication with community.
- Outcome: effectively rented/sold project meeting financial and other project goals.
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