Six Reasons to Not Hire a Project Manager
A real estate investor contacted Real Projectives® some months ago, asking for help with a new hotel project in California. The deal involved a hotel operator, contractor and architect team the investor had worked with before, in a location that was familiar to the investor and a familiar product type. While we specialize in overseeing projects like this, we suggested the investor might not need our services.
We believe in adding value to all deals. On the contrary, when we don’t think we will add value, we advise prospective and actual clients on alternative approaches to best meet their needs. So, we thought it might be instructive to offer some reasons why, and when hiring an external project manager might not be worthwhile.
The Project Scope Is Small
Perhaps your project only involves redecorating or refinishing. A simple “paint and carpet” type of job doesn’t typically warrant the oversight services offered by firms like Real Projectives®. In these types of cases, a facility or property manager or someone on staff can usually schedule, track and assess the quality of the improvements.
The same holds true for jobs that call for routine maintenance, basic repairs or replacing old equipment — the operations and maintenance staff can get that work done. If, however, you find that multiple contractors are needed or adding new equipment is logistically complicated, it could be wise to at least ask for some outside consulting and coaching.
Your Team Has Capacity and Experience
If you have a project manager on staff who has experience with your unique type and size of project proposed, you might not need to outsource. Still, you should make sure the person you’ve tapped has the time to dedicate to the project or multiple projects. Many organizations think they have enough capacity and then underestimate the burdens pulling him or her away from primary duties.
A Fresh Perspective Isn’t Required
Being entrenched in “how things have always been done” provides helpful insights. Internal staff may lead routine initiatives just fine. But sometimes a set of fresh eyes may help you see opportunities or propose creative solutions to challenges. Consultants also have a good grasp on the latest innovations, regulations and methods that could make your project run more smoothly.
You Have Local Knowledge
Local weather, building regulations and permitting processes all affect the what and how of completing real estate improvements. If your team has successfully steered similar projects to completion in the given location, you may already have the right shepherd to get the work done.
No Pressing Timeline
Most of our clients want their projects done as quickly as possible so they can start seeing a return on their investment. In these instances, having a project manager track the work, materials and coordination of subcontractors is critical. If this doesn’t describe your circumstances, you may not need to hire a project manager.
Project Is Self-Funded
If your project doesn’t need outside financing, you may not be as concerned with finding project management or oversight services. In that case, you are probably not required to have an independent monitor. On the other hand, when a lender or private equity group provides money, some level of oversight is mandated.
Of course, every project has goals and constraints, so somebody (whether internal or external) must serve as the lead to avoid missteps and pitfalls that can waste time and incur extra, unanticipated costs and reputational harm.
Are you not sure if you have adequate project management support for your next real estate project? We are happy to assess your situation and offer trustworthy guidance without a sales pitch. For more information on the range of services Real Projectives® offers clients, browse some of our other articles — or give us a call at 888.357.7342.