The real estate investment market is a highly competitive space. Deal teams are always looking for better ways to find and close good opportunities. In a market where demand exceeds supply, losing a good deal can be painful. So how can your team avoid that? Start by understanding why deals are lost and then focus on improving your process where it matters. Here are a few factors to consider.
If you are able to identify good opportunities but are often outbid, this merits investigation. What did the other team know that you didn’t? Why were they able to bid with conviction at a higher price? What data did they leverage to forecast higher returns that would justify a higher bid?
First look at your data—Were you able to reference a robust set of proprietary and market data to back up your underwriting assumptions? Did you have the data, but not in a format that was easy to find and use? Does the information that might have made a difference exist somewhere else in the organization?
Using a data-driven deal management platform can help you keep the information you need to underwrite quickly and confidently at your fingertips. Eliminating silos and gathering together all of the deal and market information that exists across your organization can help you better leverage your knowledge to gain conviction that others may lack when bidding for investments.
Many factors can slow your team down and get in the way of success. Ask yourself: Are you seeing the right opportunities but not able to screen deals fast enough? Are deals getting stuck in a particular stage in your process? Is your screening process inconsistent between team members? Are you spending too much time on the wrong deals?
If your team can’t screen deals fast enough, it’s time to re-evaluate your approach. Make sure every team member is following a consistent set of steps. Tracking your process from end-to-end will also allow you to quickly assess what’s working and where you can make improvements.
Once you’ve started tracking your process, you can identify bottlenecks that are slowing it down. One potential issue to look for is tasks that are simple but time-consuming. Consider implementing technology to automate the easy tasks that take your people hours or days to complete. Use real estate acquisitions management software to automate the deal pipeline and make desicions faster.