Private developers are property developers within the private sector. They acquire buildings or land in order to construct or refurbish building projects on the site. Private developers aim to generate a profit, as opposed to the government which aims to provide buildings for social and welfare reason.
The buildings that they construct are typically then sold entirely or in part to others, or retained as assets to produce cash flow via renting them out to occupiers who lease them, as opposed to owning their own. Some building developers have their own internal departments for designing and constructing buildings (more common among larger developers), while others just subcontract these works to third party specialists such as architects and contractors (typical of small developers).
Due to the cost of construction property, developers need to obtain funding from investors - usually banks - to proceed with construction. Sometimes developers propose schemes for undeveloped land in order to increase the value of the site, so that they can sell it on to another organisation. If a particular scheme is difficult to obtain funding for, for example if the developer does not have any other assets that can act as collateral against the loan, then they can enter joint-venture partnerships with other developers to spread the risk. Large regeneration schemes are typically developed in joint venture partnerships due to the substantial cost of construction. More often today, local authorities enter joint venture partnerships with the private sector to regenerate entire neighbourhoods, and direct funding vehicles from government to assist in funding the scheme.
In the postwar period, private developers were not involved in the council estates and tower block construction boom as these were directed by local authorities. Following the end of the boom, private developers became more involved in housebuilding, with the construction of large housing estates in suburban areas, especially in the 1980s when there was greater demand for people to own their own property. In the 1990s, private developers began to target the increase in demand for city centre apartments, as well as offices, retail, hotels and industrial facilities.