How property developers make decisions: Dublin 2010 – 2020

Property developers make crucial decisions that determine the shape and feel of our towns and cities, yet there is little consensus on how these decisions are made. This research asks how property developers make real-life decisions in a development process that is widely acknowledged to be complex and uncertain. It contributes to the growing body of research on developers that rejects the simplistic economic understanding of developers as predictable rational actors. To do this a new conceptual framework is developed that incorporates both the broader social and psychological dimensions of how decisions are made. The research design takes the form of a case study so that context can be considered because property developers’ actions and decisions are known to be embedded into a prevailing local institutional context – Dublin from 2010 to 2020. This research argues that public sector relationships are used to influence, bypass and reshape policies in an attempt to reduce uncertainty. On the other hand, private sector relationships appear more nuanced where those relationships that secure resources such as equity funding are often deeply personal and trusting, and those that deliver market rich information depend on developers being more widely connected in social and loose networks. It is clear that it is the entrepreneurial characteristics such as creativity, drive and organisation skills that define the developer’s role in the development process. The broader psychological dimensions of the conceptual framework used in this research reveals that longer-term decisions with more uncertain outcomes are arrived at through intuitive, emotionally charged psychological decision processes. The behavioural economics literature foregrounds the extensive use of heuristics and points to the clear dangers that can result from relying on this type of decision making. However, this research argues that in complex uncertain decision environments where the decision outcome is longer term, property developers plumb the deep resources of their experience gained through successive development cycles. By doing this a set of patterns, or mental short-cuts is recognised that through habitual use has proved successful in the past. Finally, this research throws light on the behaviour that results from considering decision making through this new conceptual framework. It finds that experienced place-based local property developers pay greater attention to deep trusting relationships to achieve their objectives which is distinguished from institutional and novice developers. By differentiating between experienced and novice developers, this study developed the old institutionalists’ ideas of the power of intuition and the importance of developing habit through experience