• Real Assets
  • Intapp DealCloud

4 ways to improve CRE investment deal flow for a stronger deal pipeline

In commercial real estate (CRE), success isn’t measured by the number of closed deals — it’s measured by the number of closed profitable deals. To find the best deals possible and improve your dealmakers’ hit rates (i.e., their ability to exit at above-market returns), your firm must develop your deal pipeline to identify undervalued assets, streamline purchasing, and exit at the right time.

Check out these four ways to improve your CRE investment deal flow and help your dealmakers increase their hit rates.

1. Focus on sourcing the “right deals” for your CRE portfolio

Entrepreneurs and venture capitalists know that chasing down bad leads is a waste of time and a hindrance to deal flow. Develop a nuanced understanding of what qualifies as a good deal for your business, and pursue the companies that look most like your idea of success.

Your existing investment portfolio will provide key insights into which deals have so far proven most successful for your firm. Compile data regarding investments that have performed well, including metrics such as cap rates and cash-on-cash returns, and compare any prospective acquisitions to these indicators of success — of course always keeping in mind that past performance doesn’t necessarily predict future performance.

Then, identify gaps in your existing portfolio or portfolio companies — specifically, areas of real estate in which you haven’t diversified and don’t have a presence, such as different geographic regions or types of real estate. These may present opportunities for exploration.

Technology can help you glean actionable insights from large volumes of data. As CPX Properties notes, “Technology can be used to aid brokerage teams by supplementing their core industry knowledge and deep relationships through better data insights and more efficient processes.”

Due to its advanced capabilities and complete analytics platform, many CRE dealmakers use DealCloud to help them with deal flow management. Users can track key information regarding real estate investments to determine what does or doesn’t work best for their firm.

2. Connect with your network and build your personal relationships

Deals are made between people, not companies. It’s important to prioritize your personal relationships and spend time with your contacts to further develop trust. Neglecting your relationships could mean losing out on great deals.

It can be hard to foster these relationships, especially if you’re usually busy exploring deals and checking in with multiple touchpoints. But as Evolve Ventures Co-Founders Amy Malloy and Heather Personne learned, it’s crucial that CRE dealmakers put their networks first.

“We both saw firsthand the value of becoming experts in the details, and the importance of building our networks,” explained Personne. “As we’ve grown in our careers, we’ve relied on our knowledge base and our relationships to help our clients and build a community that we are proud to be a part of.”

Whether you’re connecting with people through social media, talking to angel investors, or connecting with other PE firms, you should always start by consolidating your contact information. Data consolidation makes it easier for you and your team to connect with people and log your interactions for analysis.

DealCloud syncs your contact information with third-party CRE data that connects people with businesses. These third-party databases can identify industry figures, glean their work history, and determine how well-connected they are with other organizations and investments. DealCloud’s relationship management capabilities let you develop your relationships with accurate and timely information in hand.

DealCloud users can also leverage automated touchpoints to nurture relationships that may not yet be a priority. Keep your firm top of mind and improve deal origination by sharing newsletters or drip campaigns, linking people to your podcast, or connecting with them via LinkedIn.

3. Scale your deal flow through collaboration and automation

Poor communication easily sabotages deal flow. If a prospect leaves a message with a colleague who fails to share it promptly, critical information can get lost in the shuffle. You can’t move your leads down your pipeline if you can’t organize your team.

Capture more potential opportunities and operate more effectively by using a centralized CRE investment tool to sync up with your team members wherever they are. Prioritize your deals and ensure that none of your leads slip through the cracks. Consolidate all your dealmaking data within a single platform and collaborate in real time so you can close deals more effectively as you scale.

Also, be sure to standardize your pipeline with checklists and workflows. Checklists ensure that all your processes are maintained and complete even as your investment team grows, while automated workflows move deals down the pipeline, so team members can hand deals off to each another as they evolve.

A data-driven deal flow pipeline doesn’t just make collaboration easier — it helps you identify areas of inefficiency. DealCloud is an all-in-one suite for collaboration and automation, accelerating and streamlining your CRE pipeline management.

4. Streamline your CRE due diligence

You want to close a deal while it’s still fresh. But once you’re ready to make a deal, you still need to perform due diligence; otherwise, you’re at risk of closing a bad deal.

CRE deals can come in on tight turnarounds that demand quick action. You need to organize multiple departments — such as legal, financial, and the C-suite — to complete your due diligence and assess the strength of the deal.

Streamline the process with automated workflows, checklists, and improved collaboration. Use checklists to keep track of everything you need, such as whether:

  • The accounting department has analyzed investment’s financials
  • The legal department has managed legal risk
  • The operations team has identified any potential internal conflicts

DealCloud helps you track due diligence by giving you the structure that you need to keep everyone in sync. At any time, you can check on the status of your due diligence and share tasks with other team members.

Keep the deals flowing with DealCloud

Stop missing investment opportunities because of a slow pipeline. Keep your hit rate up by improving the quality of your CRE deal flow, and invest in a tool made for the CRE industry by CRE experts.

DealCloud helps you track and manage your deal pipeline by giving you the data and tools you need to succeed. With better data, you can make better decisions about the deals you want to pursue — and direct your energy toward pursuing them.

Ready to explore how DealCloud can improve the quality of your CRE deal pipeline?
Schedule a Demo today