Deal Screening: Taking a Data-Driven Approach

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Despite the multi-million dollar stakes of typical commercial real estate (CRE) deals, much of the industry has remained at a very basic level of digitization. Emails, PDFs, and spreadsheets offer some simple advantages over paper, but so much more is possible. The challenge is for deal teams to shift from thinking about documents to thinking about data. It may seem a minor nuance, but in fact, the opportunity for speed and efficiency is significant.  

From Files to Data

The deal screening stage of the pipeline is an excellent illustration. When your team receives an Offering Memorandum (OM), it takes a lot of work to translate the contents of that document into data that you can use. After all, an OM serves both deal information and marketing purposes. Every asset owner or developer has their own very polished way of conveying the details you need to make a fact-based decision. From there, you have to figure out how to reorganize all that information to fit your own screening process, with data from other sources to fill in the gaps. 

While your current process might work, it slows your team down. You can easily miss relevant information about the property, location, demographics, comparables, and other financial data. As a result, you spend undue amounts of time looking for past documents, creating reports, and answering questions from senior management, legal, and treasury. 

Even after you find what you need, you face a high volume of repetitive tasks, pulling out information to copy and paste into other places. The whole process is not only time-consuming but stressful, because like most people, you want to be able to respond and move quickly.

An Example

Imagine working with a new OM for an industrial building. How does it compare to similar deals you have closed elsewhere in that market? How does it compare to other deals closed in the past 60 days? 

These portfolio screening questions should have easy answers, but combing through Excel files and attachments to emails slows you down. Ultimately, reduced speed and efficiency put you at risk. You could lose out on a lucrative deal because another buyer moved faster. You could miss the opportunity to make smarter, better underwriting decisions. 

Best Practices from Other Sectors

Ironically, if you were working with any other asset class, you would not have to worry about this lack of efficiency. Whether stocks, fixed income, or alternatives, a digital platform would show all the relevant data about investment opportunities in one place. Robust analytics would allow you to move from one data point to another and make a data-driven decision. And you would have easy access to rich data for historical comparisons and sharing with your colleagues.

That kind of data-driven decision-making is within reach for CRE, too. Everything needed to make better, sharper decisions that yield better bids more quickly is already available in scattered documents and resources. The challenge is bringing that data to light in one place—whether it comes from an OM, from past bids and closed deals, or from external sources for economic, demographic, and capital markets data.

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It’s All About Data

If you had all the necessary data to vet deals in one place, you would be able to act as nimbly as portfolio management teams for an ETF or a hedge fund. They can respond to the market effectively because they have a single source of truth with up-to-date information, supporting documents, collaboration tools, and performance analytics. You would achieve better results if your deal teams had those advantages.

A data-driven approach improves your deal workflow and your entire investment process on two fronts. First, you make decisions more quickly. Even shaving a few days off your process from OM to bid could help put you first in line for the best opportunities. Second, you make underwriting assumptions with more knowledge and greater ability to support your assumptions on factors like Net Operating Income (NOI), cap rates, or vacancies. You do not have to worry about making deals more slowly and with less certainty than you would like. 

Finding the Light in a Changing Market

You are probably already thinking about how the commercial real estate market will adjust to new realities such as long-term pandemic impacts, rising interest rates, and new economic conditions. In a dynamic environment, decision speed and quality give you an essential edge. Using data helps you find the best opportunities and take them to a successful bid and close. What you need in today’s market is room to maneuver and full transparency.


Taking the cumbersome, manual aspects out of your pipeline management process only makes sense. Having better tools to make better decisions is a good idea no matter what the market bodes. 

Here’s how you can get started:

  1. Start with one part of the process, such as deal screening
  2. Look at where you rely on information that’s locked up in documents, folders, or email
  3. Identify the data that you need or would like to have
  4. Learn about available platforms that help digitize data and make it more accessible

Even if digital tools for CRE seem a bit behind the curve compared to other markets, there are solutions out there. You don’t have to settle for chasing down files.

Platforms like Origin by Altrio can give you a significant edge in your deal pipeline process by helping you systematize and create structure, use market and proprietary data to drive accuracy at every step, and quickly identify and address bottlenecks. To see what Origin can do for your team, contact us today.