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The Origin of the Master Development Delivery Model

The Origin of the Master Development Delivery Model

The Master Development delivery model was originally conceived as a way to accomplish the following objectives:

  • Create a system whereby limited government investment would ‘’kick-start’’ large-scale projects
  • Spur private-sector investment and create a viable private-sector real estate development industry ecosystem
  • Enable government regulation and oversight of key aspects of real estate development without hindering project efficiency
  • Offset the high cost of infrastructure needed for new projects with a service charge system which passes on long-term maintenance costs to investors

The intended result was a form of PPP (Public Private Partnership) which could be rolled-out on a large scale with the flexibility to be adaptable on an individual project basis. The model enables an accelerated rate of development due to the following factors:

  • By limiting government investment into the early stages of a project and soliciting private-sector investment to build-out the latter stages of a project, limited government funds can be spread across a larger number of projects
  • By creating a ‘’semi-government’’ entity with private-sector systems and processes to control and manage the master development (versus a government ministry), inefficient bureaucracy is largely reduced.
  • By allowing the master developer to serve as the de-facto ‘’municipality’’ and organize and control much of the monitoring and technical auditing tasks needed for execution of projects on a large scale, private sector developers experience increased efficiency in the approval process which allows projects to be delivered faster
  • By offsetting some or all of the long-term infrastructure maintenance and upkeep required for new projects with service charges passed-on to the private sector (versus handing-over all the responsibility to government ministries), development projects can be executed without the costly expansion of government departments

These steps require a significant re-thinking of the relationship between government entities and private-sector companies, as well as a re-working of the typical roles and responsibilities of government agencies within the real estate development process.