Development interview questions

A foundational real estate development question.

What is a development spread and why does it matter?

Asked because approvals can make or break land value.

What is entitlement risk in a development deal and how do you underwrite it?

Used to test whether candidates understand construction risk allocation.

What is a guaranteed maximum price contract and what risk does it not eliminate?

A basic construction budgeting question for analyst interviews.

Define hard costs and soft costs in a development budget. Why do they matter differently?

Tests whether a development candidate can connect a procurement detail to delivery and financing risk.

Your contractor says electrical switchgear has a 52-week lead time and must be installed in month 14 of an 18-month build. What does that mean for the project, and what would you do next?

A first-round development question that tests whether you distinguish owning land from having the right to pursue a deal.

A developer says it has a site "under control" but has not bought it. What does that usually mean, why is it valuable, and what would you negotiate in the agreement?

A first-round question for office, industrial and mixed-use development.

Why does preleasing matter in a development project?

Tests practical knowledge of how development debt funds over time.

How does a construction loan fund, and why is interest reserve important?

A development math question showing how thin spreads can disappear.

A project has total cost of $100m and stabilised value of $125m. If costs rise 10% and value is unchanged, what happens to profit margin on cost?

A practical development-analyst exercise after a monthly construction report.

A project has a $50m approved budget, including $4m of contingency. It has incurred $18m of cost, has $27m of remaining committed contracts, and the project team forecasts $8m of uncommitted cost to finish. Calculate…

Development interviews test whether you understand the risk premium being earned.

Why would a developer build a property rather than buy an existing one? Quantify the return they're targeting and name the risks they're taking.

Tests whether candidates understand development value is exposed to capital markets at delivery.

A development is expected to stabilise at $8m NOI and sell at a 5.0% cap rate. What happens if exit cap rates move to 6.0%?

Asked to test whether candidates understand stabilisation is a process, not a date.

How would you underwrite lease-up for a newly delivered multifamily or office project?

A numerical land-basis question for development interviews.

A project will produce $6m of stabilised NOI. Market cap rate is 5.0%, hard and soft costs excluding land are $85m, and the developer requires $15m of profit. What is the maximum land value?

A sponsor-level question on promote economics in development deals.

Why do development deals often use joint ventures with promotes, and what should the capital partner watch for?

A judgement question on derisking a project before completion.

Compare a forward sale of a development with building spec and selling after stabilisation.

Development interviews test whether you understand the financing, not just the pro forma.

Walk me through how a construction loan is structured and drawn. What protects the lender?

A development analyst case sequencing entitlements, GMP procurement, financing and pre-leasing under a delayed approval.

You are the development associate for a mixed-use project. A planning delay threatens the targeted completion date and construction loan availability. Manage the critical path as new facts arrive, then send the…

How a developer decides what a site is worth. And the calculation is unforgiving.

A site can support 200,000 sf of apartments. Stabilised NOI would be $9m, exit cap 5.5%, hard and soft costs $110m, and you require a 20% profit margin on cost. What can you pay for the land?

A development asset-management case after an unexpected field condition threatens a project's budget and delivery date.

During construction, the general contractor submits a $3m change order for subsurface remediation and says it will delay delivery by two months. The project has $2m of contingency remaining. How would you respond before…

An investment-committee judgement case for a developer deciding between a single build and phased delivery.

You control a site entitled for 500 apartments. Building all 500 at once costs $150m and delivers in 30 months. A two-phase plan delivers 250 units in 24 months and the other 250 units 18 months later, but costs $158m…