Agile Development : Attracting Talent

The tech world offers another lesson to New Urbanist and Smart Growth start-ups. The best tech companies attract the best talent and the best talent attracts the best compensation. Further, these organizations are populated with genius at every post required to deliver their product. Design, engineering, marketing, and delivery are all highly valued as it takes proper execution of each discipline to be successful and to stay on top.

In contrast, the world of real estate development took a less balanced approach. In order to achieve greater reach (or scale, for techies) and deal with the issues of project finance they looked to minimize costs as much as possible. The preferred business model led to the cookie cutter approach to project delivery and allowed the process to be refined for the benefit of the balance sheet. This refinement did not necessarily benefit the customer. The tyranny of the pro-forma led to a one-size-fits-all approach where the only real options involved more or less of the exact same thing.* The result, as we see today, are millions of unoccupied homes all across America. These houses cannot be easily adapted to suit the needs of today's home-buyer and have very little to offer aside from a low price and declining property value.

There is plenty of movement in the market, however, and a tremendous opportunity for certain building types. Class A and B apartment buildings seem to be doing quite well in this otherwise tumultuous property market. Yet instead of advancing the model and generating plans that can adapt to a changing market most developers are content to do more of the same. This leaves an entire market segment under-served and will allow a smart startup to gain a toehold in a market where they would otherwise be shut out.

The first step, however, is to attract the best talent in order to put together a proper project proposal. If the proposal is sound and the market response is positive then the endeavor may attract funding. Until such time the bootstrapped project team will most likely be short of cash. It's almost impossible to find talent to work for free so other arrangements will have to be made. This is where the techies have it all over bricks and mortar developers. By divvying up shares and creating option pools for future hires the savvy tech developers offer the potential of a very lucrative compensation package to their recruits. If the required disciplines in the world of real estate development would choose to organize in such a manner they would be a formidable force in their chosen market.

It's no wonder that tech start-ups are incubated in dorm rooms and garages since the greatest concerns of anyone who signs on to such a venture will be where they will live and where their next meal will come from. Having room and board already covered they are freed to concentrate on their company. This is a tremendous advantage since more time can be dedicated to refining the product and less time seeking a paycheck.

It is possible, however, to work with established professionals by utilizing the charrette method. This delivery type allows the project team to gather for intense workshops at each phase of development and then return to their regular line of work to keep the lights on. This limits the time commitment required of each member of the team while ensuring each phase of the project receives the attention it deserves. The project champion can then steward the development until such time as project funding is secured and the team can work together full time towards the realization of their vision.

This method may entail a paradigm shift away from what is normative in the industry. The results, I suggest, would be better for all involved but most especially for the consumer.

Posted via email from Kenneth Hitchens