The role of the project manager: what is it and when do I need one?

If you are like me, you probably have a hundred things going on at the same time and maybe, just maybe, building a house or a project might be too much and you require assistance. This is where a Project Manager can be useful.

The Project Manager position is trending nowadays because of the many problems investors and developers have experienced in their projects. The role of the Project Manager is to lead and coordinte with all team members and make sure everyone is on the same page, communicate with stakeholders, manage resources of all kinds and making sure the project is moving forward in order to guarantee its successful completion within the pre-establised parameters. Also, a great project manager will always aim to increase the project’s effectiveness and efficiency.

A good decision is for the Project Manager to be the first position appointed and under which all the other participants will revolve around. Project Managers have different expertises and capabilities; therefore, if you are choosing one for your real estate project, make sure it is one that has design and construction experience to facilitate, expedite and maximize the decision making process.

I would like to note the a Project Manager should not be taking or making technical decisions as this could be construed as an overlap and conflict with the building, inspection and/or architectural teams. In my experience a great Project Manager will know know this and the scope of his or her involvement. I always say that a Project Manager is what we would call a fiducary position, meaning it is a role based on trust in which there is ownership representation.

Most Project Managers operate under a professional services agreement structure and can be compensated via a monthly fee, a monthly fee with bonuses upon compliance of milestones, or on percentage basis of the value of the project; therefore, you have options to retain your Project Manager.

Now, does every project need a Project Manager? No. It will not be cost effective to retain a Project Manager for all projects. Having a Project Manager is only advisable for large projects, projects of great complexity and/or that may exceed US$1 million dollars in total construction investment. For smaller projects, the solution is to have the proper checks and balances structures between the architects, engineers or inspectors and detect potential conflicts of interest.

What are the Project Manager most common roles?

• Planning and Coordinating: A building project has many moving parts; therefore, developing project roadmaps, defining the scope of the project, timelines, budgets and coordinating with architects, contractors, and stakeholders is one of many essential roles of the Project Manager.
• Risk Management: As the quarterback and from its vantage point, the Project Manager must be capable of identifying and assessing potential risks that may affect the real estate development project, and implementing strategies to mitigate them. This could involve legal considerations, market fluctuations, changes in currencies, shortages of supplies, or unforeseen challenges during construction. Constant communication with the different actors and making sure information is shared, discussed, and cleared is necessary.
• Budget and Schedule Protection: All projects are subject to a schedule and a budget; therefore, managing the financial aspects, ensuring that it stays within the allocated parameters and using the tools to track the information and make it visible to all the teams in important. This involves tracking expenses, negotiating contracts, and making cost-effective decisions. Defining, confirming and supervising the project costs and cash flows is basic of a position of this nature.
• Communication: Facilitating clear communication between various parties involved, including clients, contractors, regulatory authorities and even the stakeholders is a necessary component of the role of the Project Manager. Good Project Managers are not afraid to call out anyone about their tasks and progress and this does not exclude the principals or stakeholders.
• Compliance with permitting: Ensuring that all permits, licenses and filings are tracked is part of the role.
• Quality Control: Creating quality control procedures and standard operating procedures for monitoring and maintaining the quality of work throughout the project is a role requirement. Implement quality control measurements to meet or exceed the standards set for the real estate development or making sure the teams working on the field.
• Timeline and Resources Management: Keeping the project on schedule by tracking milestones, anticipating potential delays, and implementing strategies to overcome obstacles if perhaps one of the most sought abilities a Project Manager should have. Proposing corrective measurements to adjust to delays, breaches, overages, poor quality, substitution of vendors, and applying project management tools and softwares to maximize efficiency.
• Client and Vendor Relations: Maintaining a positive relationship with the clients and vendors can be assigned to the Project Manager as part of its scope of work. This can be attained by addressing their concerns, providing updates, and ensuring their expectations are met.
• Constant Improvements: Suggesting or recomending improvement opportunities for the projects and internal processess adds value to the role.

A Project Manager is an important member and tool that investors and developers can have in hand in cases where the complexity, size or amount requires it. Hopefully this article will clarify this important figure and how to maximize its benefits.

For more information please reach out to GONZALO ROJAS at grb@quatro.legal