A real estate investment memorandum is one of the most important documents that your business can create when you are involved in commercial real estate. The investment memorandum presents investors with important information about the project you are seeking their funding for, but also about your business. The stakes are high when preparing this document (which is why many real estate brokers use templates to help themselves out).
Here is a quick guide to this type of document.
Analyses of the Project
The meat of the real estate investment memorandum is information about the project you are hoping to secure investment for. This should include analysis of the market, the site, the project scope, and the investment strategy. You should also include information about all relevant financial aspects, such as rental rates, unit count, or square footage, depending on the type of property you are securing investment for.
This analysis should be comprehensive, not overwhelming. Present in a readable format, using charts and data, but also including explanations so investors know what they are looking at.
Information About Your Team
A potential investor would be investing in you as much as in the project you are running, so they want to know about your team. List your qualifications to put an investor’s mind at ease.
Summary and Conclusion
Highlight the main points in an executive summary at the beginning and a conclusion at the end. You want the investor to get the main points even if they have time just to read these sections.
