You’ve found the perfect site. Your concept is strong. You’re ready to engage consultants, finance the deal, and get moving. But wait - who’s actually responsible for what? Who wears the risk? And how do you make sure your interests are protected from the start?

That’s where a Development Management Agreement (DMA) comes in. Whether you’re a landowner partnering with a developer or a developer managing multiple stakeholders and deliverables, a clear, well-drafted DMA can be the difference between smooth sailing and a legal disaster.

In this blog, we break down what a DMA is, when and why it’s used, what it should cover - and what can go seriously wrong without one. Plus, we’ll share real stories from the trenches to show you how we’ve helped protect our clients’ developments with watertight legal strategy.

What Is a Development Management Agreement?

A Development Management Agreement (or development agreement) is a legal contract between a landowner and a developer (or project manager) that outlines the rights, responsibilities, and deliverables of a development project.

It’s typically used when:

The landowner wants to retain ownership of the land but engage a developer to manage the project.
The developer is delivering a project on behalf of a landowner or another related entity.
Investors or lenders require clarity on project governance and risk allocation.

Think of it as your project’s rulebook - defining the who, what, when, and how.

How Is a Development Management Agreement Different from a Joint Venture Agreement?

While both documents can be involved in property development, they serve different purposes:

A Development Management Agreement outlines how the development will be managed. It focuses on roles, responsibilities, timelines, and deliverables.
A Joint Venture Agreement (JVA), on the other hand, governs how two or more parties share ownership, risks, and profits of the development.

In many cases, you may need both:

The JVA sets out who owns what and how profits are shared.
The DMA outlines how the day-to-day development tasks are carried out and managed.

We often advise clients on both agreements as part of their overall project structure. You can read more about Joint Venture Agreements in our detailed blog here: Joint Venture Agreements: How to Protect Your Interests and Maximise Profit in Property Development.

Why You Shouldn’t Start a Development Without One

We’ve seen it too many times: parties go into a project with a handshake or vague email threads. Then costs blow out, approvals are delayed, or disputes arise - and suddenly, no one agrees on who was meant to do what.

Without a clear DMA:

The developer may be left exposed to claims for delays or defects.
The landowner might be liable for costs they didn’t budget for.
There’s no roadmap for resolving disagreements or exiting the project.

Case Study 1 – Residential Townhouse Development

Our NSW-based client was working with a related entity to build six townhouses on family land. There was no clear separation between roles, and when disputes arose about timelines and expenses, the financier threatened to withdraw funding. We drafted a robust Development Management Agreement and Joint Venture Agreement to formally split responsibilities and secure the funding - keeping the project on track and relationships intact.

Case Study 2 – Regional Mixed-Use Development

A QLD developer approached us after being denied bank finance for a large mixed-use development. The issue? No formal development structure. We worked quickly to prepare a comprehensive DMA outlining roles, developer fees, access rights, and reporting obligations. With the agreement in hand, the developer secured finance within weeks and proceeded to DA lodgement.

What Should Be in a Development Agreement?

A strong DMA should cover all aspects of the project, including:

Appointment and Scope: Who is responsible for managing the project and what their duties include.
Structure and Ownership: Who owns the land, the project, and how profits will be distributed.
Access Rights: The developer’s right to access and occupy the land for project delivery.
Approvals: Who’s responsible for obtaining DA, construction certificates, lease variations, and more.
Finance and Funding: Who arranges project funding and what security is required (e.g., landowner guarantees).
Developer Fees: How and when the developer is paid (fixed fee or percentage of project costs).
Insurances: Ensuring all required coverage is in place, including public liability and construction insurance.
Termination: What happens if things go wrong or one party defaults.

It’s also common to include clauses on confidentiality, IP rights, GST and tax obligations, indemnities, dispute resolution, and force majeure.

When Are Development Agreements Used?

Development agreements are commonly used in:

Mixed-use and residential apartment developments
Commercial and retail precincts
Hotel and resort developments
Joint ventures between landowners and developers
Projects involving related entities or trusts (where extra clarity is needed)

Even if the landowner and developer are related parties - or part of the same corporate group - a DMA is essential to separate roles, allocate liability, and satisfy lenders or external investors.

Benefits of Having a DMA in Place

Clarity of roles: Everyone knows their responsibilities and deliverables.
Risk protection: Limits your exposure to disputes, delays, cost overruns, or regulatory breaches.
Investor confidence: Professional investors, banks, and financiers often require a formal agreement.
Efficient governance: Streamlines decision-making, reporting, and project milestones.
Profitability: Well-structured deals mean fewer cost blowouts, clearer accountability, and better ROI.

Case Study 3 – Boutique Hotel with Car Park Integration

For a coastal boutique hotel project, the developer needed to align multiple owners’ expectations. We structured the development using a DMA and supporting heads of agreement, ensuring access and operational provisions were airtight. The project was delivered under budget and remains a flagship project for our client’s portfolio.

What Can Go Wrong Without One?

Here’s just a taste of the headaches we’ve helped clients avoid (or clean up):

Developer was sued by subcontractors because the landowner hadn’t approved variations - but the scope wasn’t clear.
Dispute over profit split when the project sold - no agreement meant no enforceable formula.
Project stalled due to lack of approvals - both parties blamed each other.
Developer couldn’t get insurance or finance - no formal agreement meant no security.

Key Takeaways:

A Development Management Agreement is essential for protecting your development and clarifying responsibilities.
It outlines key elements like roles, funding, approvals, risk, and profit.
DMAs are crucial even between related entities or family structures.
Not having one exposes all parties to legal, financial, and operational risk.
With a strong DMA, you set your project up for success - on time, on budget, and dispute-free.
When used alongside a Joint Venture Agreement, it offers complete coverage of ownership and operations.

Next Steps

Whether you're in the early stages of site acquisition or already negotiating with builders and consultants, we strongly recommend you have a Development Management Agreement drafted or reviewed by a lawyer experienced in property development law. We’re here to help.

BOOK YOUR FREE CONSULTATION

About the Author: Erin Vassallo

Erin Vassallo is the Principal Solicitor and founder of Law Team, a values-led law firm with a strong reputation across New South Wales and Queensland. With over two decades of experience in commercial, construction, and property development law, Erin is a trusted advisor to developers, landowners, and business owners navigating complex projects and legal risk.

Her hands-on experience includes joint ventures, structuring development deals, contract negotiation, risk mitigation, and project governance across residential, commercial, and mixed-use developments. Erin holds qualifications in law, political science, mediation, and disruptive strategy (Harvard Business School) and is the founder of Certified BCorp Law Team, committed to ethical business practices and social impact

FAQ’s – What Clients Ask Us Most About Development Management Agreements

A development management agreement outlines how the development will be run -who’s responsible for what, how fees are paid, and the delivery plan. A joint venture agreement defines ownership, contributions, and how profits and losses are shared. Many projects require both.
Yes. Even between related parties, formalising responsibilities, approvals, and decision-making is essential - especially for finance, insurance, and tax compliance. Informal arrangements often lead to costly disputes later.
It’s difficult. Most lenders require a development management agreement to ensure risk is managed and roles are clearly defined. A strong DMA can actually strengthen your finance application.
Every agreement is unique, but you’ll typically need to include scope of works, developer rights and obligations, finance arrangements, approvals, insurances, dispute resolution, fees, and termination clauses.
You may end up in a dispute without a legal framework to resolve it. This can result in delays, loss of finance, litigation, or project failure. Having a DMA in place protects your interests and minimises risks from day one.

Disclaimer: This article is general information only and cannot be regarded as legal advice as it does not take into account your personal circumstances. For tailored advice, please call us on 13 55 29 or email us at hello@lawteam.com.au.