Necessity of Project management for real estate industry

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Necessity of Project management for real estate industry

Necessity of Project management for real estate industry
  13 December, 2020   Dr. Preeti Adhav

Every firm irrespective of fields favors project management because it is discipline process tending to successful project. But it also becomes essential to execute project management process with perfection.

The motive of this article is to explain about-

1. Real estate Project management process.

2. Real estate project management course.

3. Real estate project management jobs.

4. Real estate project management salary.

So let’s break down the term real estate as real means actually existing and estate means land, property or assets own. As a result we can define real estate as actual land or property owned. Real estate is one of a most important sector of nation’s economy. The agenda is also to explain why Project management for real estate industry is essential.

Real estate has four types-

1. Residential real estate- It includes residential homes, condos, cooperatives, duplexes, townhouses, and multifamily.

2. Commercial real estate- It includes shopping centers and strip malls, medical and educational buildings, hotels and offices.

3. Industrial real estate- It includes manufacturing buildings and property, as well as warehouses.

4. Land- It includes vacant land, working farms, and ranches.

 

Project manager plays key role in project management process for real estate. There are steps for project management with respect to real estate-

1. Project Initiation-

This is one of the major stages of the project where analysis is done. The scope of the whole project is explained in this phase. The analysis is done for the requirements of the client by the project manager. The process involves about the selection of location. Then important step is to calculate cash flow. The cash flow is been calculated as rental income of property minus all expenses we spent on that property. The cash flow should be positive. Because if expenses will be less than rental then it will be calculated as the profit made. Thereafter, the capitalization rate is calculated as net property income divide by the value of property in current market as a whole multiplied by 100. Then cash on cash return is calculated as annual pre-tax cash flow divided by total cash invested. After that comparative Market analysis is done. It is simply comparing similar properties already sold in the market. A project manager also checks the needs of the client and the feasibility of a project.

2. Project Planning-

After initiation project planning is done. Understanding the scope of a project is clearly done by project manager. Thereafter, project manager prepares multiple business cases. SWOT analysis is done. Specific goals are set with respect to project. Project manager schedules meeting with system team and stakeholders. Budget of project is been discussed and fixed with respect to scope and requirement of project. Contractor is selected in this phase. If any issues exist then problem solving is been done along with respective team. After that task activity planning is done by project manager by preparing various charts. Then project manager pre-plans resource allocation to particular tasks. Deadlines are set with respect to task allocated to resources. In project management one plan can never stand or isn't guaranteed. So project manager creates new plans along multiple business cases. Planning is done in a way that project estimated price meets or reduced lesser than a fixed budget price of the project.

3. Project Execution-

After planning the actual process starts for project. Project manager executes the planning into action. The activity chart is prepared by the manager which is strictly followed with respect to resources and time. Deadlines are followed as discussed in the planning phase. Daily team reports are been sent to the project manager by the team. The manager checks the report and maintains its track record. A manager also schedules weekly meetings (scrums) to share the status of projects with leads of the respective team. If the manager finds that tasks are not getting completed as planned according to activities then problem solving sessions are held. The activities includes like design is completed by architecture and engineer, management coordinating with all construction activities, IT department for automation and sales department related to sales activities. In this way all tasks are executed by project manager with respect to time and resources ensuring quality work.

4. Project Monitoring-

Monitoring is very important for the project till its completion. It is the duty of the manager to deliver quality projects within the deadline set with respect to budget and resources. There are maximum possibilities where uncertain changes can occur so the project activities are required to be monitored and controlled. There are many cases where lots of projects although successful at the initial phase failed after execution due to lack of monitoring and control over the project. Factors needed to be controlled are Scope, Schedule, Cost, Quality, Communication, Uncertain changes, Risk, Procurements and Stakeholder engagements. As the risk is involved the plan is required to be modified or changed at any instance. Reference of past project is also taken for improvement in current process. With all effords the motive of project manager is to deliver successful project in deadline with respect to resource allocated and ensuring best quality of work.

5. Project Closure-

Closure is the final step after completion of all above processes of real estate project management. After a quality product is delivered by the project within deadline with respect to resources and set budget then the project is declared complete. In this phase even if a project is failed or succeeds some learning is taken as a conclusion. A complete project can never be perfect meeting all requirements. If some features are pending in the current project version then future enhancement is added for the next version of the system. Documentation of the project is also maintained by a project manager for reference.

 

As a result, it concludes that project management is a process essential for real estate business. A small failure in single phase of project management could hamper the success of project. As management is the art of getting things done with respect to time and resources it can be learned and skills can be developed through management courses. So Monks Learning Lab is providing the best course of PMP training to develop professionals in real estate business under the guidance of experts in this field. One of the most required and important criteria demands PMP certification which states that candidate has more enough qualities required for job and also eligible for good salary. So if candidate desires to be best professional as part of management team then PMP certification is important.