FREE Webinar Replay and Transcript: Valuate for Commercial Real Estate Investment Sales Property Sellers and Brokers

Watch this 15-minute webinar replay to learn how Valuate can lead to:

• more and bigger investment sales property listings,
• better buyer prospect engagement, 
• and more property purchase offers

 

Transcript below:

Welcome, this is Bruce Kirsch, founder and president of Real Estate Financial Modeling, thanks for joining…

We have a terrific webinar for you today, we’re going to talk about how Valuate, which is REFM’s web-based property transaction marketing and financial analysis platform, empowers you, with very little additional effort or time, to present investment sales properties in a significantly more compelling, impressive manner that can lead to more and bigger listings, better buyer prospect engagement, and an increased number of property purchase offers

While commercial real estate has lagged in the adoption of new technologies, by the end of this webinar, you’ll understand why Valuate is on its way to becoming the ultimate listings pitching tool, and why major property buyers are telling their brokers to “Valuate it” and share deal financial analyses with them that way

Let’s go ahead and get started

What I would like to talk about just for a moment is the evolution of how investment sales properties have been analyzed from a financial point of view and marketed over time

Everything used to be done in hard copy, by snail mail, and by hand with pencil and paper — the marketing communications, the offering memo itself, the deal room, and financial analysis

Over time, we graduated to an electronic and digital format, where confidentiality agreements were transmitted by fax, and the offering memo was made available in a PDF file in addition to being disseminated in hard copy, the deal room moved to a CD-ROM disc, and financial analysis moved onto Lotus and Excel

The last major transition has made everything digital, where marketing communications are sent out via blast email, the Offering Memorandum is almost exclusively in PDF, which the prospect prints, and the deal room now sits in the cloud

Financial analysis has come to include ARGUS in addition to Excel, and Lotus has disappeared

While it hurts to admit it, most of the time and effort spent on making the offering memorandum is a waste because buyers flip right to the rent roll and financials sections, skipping over everything else

Buyer prospects are frustrated with the financial analysis process, though. Their three biggest pains are that it takes too long to run and rerun analyses, they make too many mistakes and omissions, and it’s hard for them to keep track of the different versions of files, and which was shared with whom internally and externally. This all creates stress and leads to wasted time and energy for buyer prospects, and as we all know, time kills deals

Providing a transaction financial analysis to buyer prospects in Valuate allows them to work faster, avoid mistakes and omissions, and track files and collaborate with their partners more easily. It serves as the ultimate deal-screening tool for them, giving them pro-forma precision at back of the envelope speed, on all bases: unlevered, levered and joint venture.

And Valuate can be leveraged easily even by brokers without dedicated financial analyst support. Regardless of your level of back office assistance, Valuate raises your level of analysis and presentation significantly

Imagine buyer prospects looking forward to getting a deal from you over email instead of dreading all of the work that it will take just to see if it’s the right fit for them. If you were a buyer, which of these two emails would you rather receive? It’s a no brainer — the one with integrated financials, instantly interactive, or at the very least, a teaser snapshot of the financials that piques their curiosity enough for them to sign the Confidentiality Agreement

The same big opportunity exists for the presentation of transactions on mobile devices, where increasingly more prospects are likely to be making their initial screening decisions

And imagine pitching a prospective listing as the brokerage team with the slickest, most engaging property marketing platform out of the entire bake-off group. It makes the teams who only pitch with PowerPoint, hardcopy collateral, laminated maps and foam core boards look behind the curve

Valuate helps buyer prospects out with the 2nd second half of the financial analysis process, which is taking an existing property-level operating cash flow projection, and applying purchase, sale, debt and equity and JV mechanics

In the case of financial analyses of acquisition and disposition of existing retail, industrial and office properties, it replaces the use of Excel, acting as a companion to ARGUS

And in the case of financial analyses for acquisition and disposition of multi-family, hotel and self-storage properties, it replaces the use of Excel for the second half of the analysis

Let’s go ahead and get onto the platform

I will log in now, and when I do so Valuate presents me the Dashboard screen of the last file in which I was working

What I want you to keep in mind as we go through the application is that providing transaction analyses to buyer prospects in Valuate is a level of client service that is far above and beyond what has been done traditionally. Prospects notice that

The first thing you’ll see here on the Dashboard screen is that there is a clean, crisp, polished presentation, which is well-labeled and very intuitive to navigate and interact with

Valuate’s interface has incorporated some of the familiar conventions of an Excel spreadsheet, such as the formatting of inputs in bold blue type, so that it still has a natural feel

The Dashboard screen is a hybrid input and reporting screen, and provides the perfect Executive Summary view of the transaction for investment sales team managing directors, property sellers, and buyer prospects. There are three other input screens, and we will show you those as well in a moment. They are Cash Flows, Purchase/Sale, and Sources of Funds

What’s convenient and productivity-enhancing to buyer prospects is that key transaction analysis inputs are editable right here on the Dashboard, so sellers, brokerage managing directors and buyers who don’t want to go anywhere else in the application don’t have to — they can manipulate 80% of the deal drivers from this single screen and see the investment returns key performance indicators adjust in real time. Valuate allows you to provide this luxury to sellers and buyer prospects

Inputs can be changed rapidly, and buyer prospects get useful reporting elements in Valuate that they don’t have in ARGUS and Excel, such as how this unlevered summary table automatically regenerates to terminate as of the new forward year of a selected property holding period

And so now I’m back to showing the monthly-based eleven-year analysis timeline

Everything currently showing above the fold here is the unlevered analysis, and below the fold we have the levered analysis section

To be clear, Valuate runs these analyses based on the manual importation of a set of monthly operating cash flow projections directly from either ARGUS or Excel

The user imports the cash flows on the Cash Flow screen, and then Valuate integrates the purchase, sale, debt and equity elements, all computed at a monthly-level of granularity and precision

Let’s go to the Cash Flow screen now, and I’ll show you how easy, quick and painless it is for you as the broker to bring in the cash flows, and for sellers and buyer prospects to dump in their own versions when they inevitably adjust and re-adjust key income and expense projection assumptions in the first half of their analysis

Let’s say you have a monthly projection in Excel — you simply select the entire relevant area of the tab, hit Ctrl+C, toggle back to Valuate, paste with Ctrl+V, and then click the Process Cash Flows button. That’s it! In under 10 seconds, the cash flows have been read into the Valuate system

The biggest time-saver and best part is that no matter what the unique collection of line items you present in your analysis or what the buyer modifies, Valuate accepts them all and finds the subtotal lines automatically — there is no reconciliation or vetting of totals needed, none whatsoever. This is a huge step forward from spending 15 minutes carefully checking to make sure that each line item was mapped properly to an Excel file, and then validating manually that all of the subtotals and totals tie

This same copying and pasting works when sourcing the cash flows directly from the ARGUS property level report screen

Next is the Purchase/Sale screen, where we can provide more detail on acquisition costs, as well as include Acquisition and Disposition Fee inputs, which are always of interest to buyers to include in their analysis. The Purchase Price can naturally be updated here vs. what was input on the Dashboard screen, and the good news is that whenever you update a variable in one place in Valuate, if it also exists elsewhere it will update there as well. So for instance if I were to update the Purchase Price here, this new amount will automatically override the previous price input on the Dashboard

Last is the Sources of Funds screen, where we can size an amortizing or interest only senior loan quickly based on either Loan To Cost or Debt Service Coverage Ratio tests, and effortlessly create joint venture partnership structures of up to three players

Here we’re showing a loan sized by Loan To Cost, and a two equity player transaction. To introduce a third player and create a double-promote to the Sponsor, all we have to do is change this input from two to three, adjust the shares of investment for each with the slider bar, and give the new player a name

To remove the third player, a normally involved and messy process in Excel, we would simply change this back to two players and it’s done

Keeping the three-player structure intact, let’s scroll down and see how quick, easy and foolproof it is to define the waterfall profit sharing structures among the three players.

The first set of boxes here is for the Sponsor and Third Party Investor, and the second is for the Sponsor and its Equity Partner. To change the number of tiers in the Waterfall, all I do is this and the table will adjust automatically, and I can then update the hurdle rates and promotes if I need to. There is no way to mess this up, where in Excel it’s potentially treacherous to change the JV setup

Needless to say, giving this level of sophisticated analysis ability to prospective buyers is a potentially huge competitive advantage to sellers and brokers for the superior client experience that it provides

The gains that Valuate brings to collaboration and prospect engagement are also astounding. Once you have a file that you are ready to present, you simply click the share button, and a separate private copy of the file will be generated for you to share internally and externally. Each recipient of a shared file can then log in and manipulate inputs individually and privately, all without impacting your copy of the file. This can be done while on the phone with one another, reducing all of the back and forth and helping to compress the timeline of a discussion or a negotiation. With Valuate, it’s click and call, and everyone’s on the same page

While you might not believe it, your listings and buyer prospects can actually do everything that we have shown you so far right from your phone or tablet while in a taxi or waiting for the subway, everything of course other than pasting the cash flows. The time that Valuate can free up by allowing this access from mobile devices is significant

Valuate is a monthly subscription service, priced at $149 per user per month.

For brokerage teams, white label, private server implementations are also available, where the color scheme of the application interface is customized to your company’s brand guidelines, and where a full set of prospect behavior analytics is available. Imagine as a brokerage being able to see which buyer prospects have logged into the file, how many times, and the length of each login. Instead of having to guess blindly who is truly interested in a deal, you will have the edge of being able to view this file access reporting, which helps you spend your time and energy following up with those who are most likely to end up in the best and final round

Our offer today is a premium subscription pre-sale of 6 months or 12 months of access at 50% off, which is the deepest discount we will ever offer

This is either $447 or $894, and the bonus that’s being offered with 6 months of access is a $500 coupon towards any other digital REFM product, such as our Excel templates, which can be used seamlessly with Valuate. The bonus offered for a presale purchase of 12 months of access is a $1,000 coupon. All Valuate pre-sale purchases are satisfaction guaranteed or your money back, and premium access includes online and phone support, and we’ll even load your first deal along with you

All brokerage firm individual subscription purchase amounts can be applied to the cost of a future brokerage platform white-label implementation

Buy now as this offer is only available through November 10th