Development-stage real estate
Investing in real estate at the development stage.
Investing in development is different from buying property. The asset does not exist yet, so the investment is in the land, the plan and the ability to deliver them. That brings risks finished property does not carry, and returns that depend on how well those risks are handled.
Development is a different exposure
A finished building can be inspected, valued against similar buildings and let to tenants who are already in place or easy to find. A development can only be judged through its plans and assumptions: what the land allows, what the building will cost, how long it will take and who will occupy it. Each assumption can move, and the investor's outcome moves with it.
The reward for that uncertainty is the chance to create an asset rather than buy one at market price, and to shape it for long-term demand. The skill lies in knowing which uncertainties can be resolved before capital is committed and which have to be carried and managed through the project.
Where the risk sits
Land
Title, permitted use, ground conditions and access. Most land risk can be investigated before commitment.
Approvals
Planning, building permits and utility connections. Delay is the usual problem rather than refusal, and delay costs money.
Construction
Cost, programme and quality, managed through design, procurement and contracts but never removed entirely.
Leasing or sale
Whether occupiers or buyers arrive on the terms assumed. A pre-commitment, such as a build-to-suit lease, reduces this sharply.
Operation
Running costs, maintenance and the asset's ability to keep its occupiers over time.
Entering at different stages
Development investment can begin at different points, and each carries a different balance of risk and reward. Entering at the land stage, before approvals, offers the most room to shape the project and the widest range of outcomes, because the use, the design and the cost are all still open. Entering once approvals are in place removes much of the planning risk but leaves construction and leasing ahead.
Entering during construction trades some of the upside for a clearer view of the cost and the programme. Committing to acquire the completed asset once it is built and let carries the least development risk, and the terms reflect that. Which entry point suits an investor depends on how much uncertainty they are prepared to carry and how involved they want to be.
What you should expect from us
Clear information
The facts behind each opportunity and the assumptions under them, set out before any commitment and updated as the project moves.
Defined roles
Who is responsible for land, approvals, design, construction and leasing, agreed before any commitment is made.
Decision points
Stages at which the parties review progress and decide whether to proceed, instead of a single commitment at the outset.
Aligned interests
Arrangements in which the developer does well only if the development does, not simply because it gets built.
How development investment is structured
Development investment can take several forms. An investor may fund the whole development alongside a developer who manages it, take a share of a joint venture, provide capital at a particular stage, or commit to acquire the finished asset once it is built and let. Each form sits at a different point on the scale of risk and involvement.
Whatever the form, the terms should answer the same questions: how much capital is needed and when, what happens if costs rise or the programme slips, what information the investor receives and how often, which decisions need the investor's consent, and how and when the investment can be realised. Answering them before commitment avoids most of the disputes that arise later.
Kinds of opportunity
The opportunities we look at sit in the areas we develop, and each rests on a different kind of demand. The ways into development investment are set out on our investment and partnerships page.
Some opportunities suit a single investor. Others suit a joint development, in which land, capital and development capability come from different parties and are brought together under agreed rules.
A note on offers
This website describes how WBI approaches development investment. It is not an offer of securities or of any investment product, and nothing on it is investment advice. Specific opportunities are discussed directly with the parties concerned, on the basis of information prepared for that purpose.
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