What do you do if your Commercial Real Estate deal needs a creative approach?

Navigating the complexities of commercial real estate (CRE) deals can sometimes require thinking outside the box. When a traditional approach doesn't cut it, and you're faced with unique challenges or opportunities, a creative strategy can make all the difference. Whether it's finding unconventional financing, leveraging partnerships, or rethinking the use of space, creativity in CRE can turn potential roadblocks into pathways for success. Remember, in a field where each property and deal is unique, flexibility and innovation aren't just beneficial—they're essential.

1 Assess Needs

Before diving into creative strategies, it's crucial to thoroughly assess the specific needs and goals of your CRE deal. This means analyzing the property, the market conditions, the financial aspects, and the long-term objectives. By understanding what you're working with and what you're aiming for, you can tailor your approach to be as effective as possible. This assessment will serve as the foundation for any creative solutions you devise, ensuring they're not just novel, but also appropriate and targeted.

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Sandeep Pradhan

🚀 Commercial Real Estate Investor ► 📈 Multifamily Owner/Operator ► 🎯 Supply Chain Enthusiast ► 🏭SAP IBP/MES Subject Matter Expert
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One of the most important part is debt structuring in CRE deal. Understanding options for debt financing along with business plan is critical for making the deal success. There needs to be balance of debt and equity and sourcing debt in creative way can provide good returns to the investors/partners.

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2 Explore Financing

Creative financing is often the key to unlocking a CRE deal that doesn't fit the mold of traditional lending. Seller financing, lease-to-own options, or tapping into private investors can provide the necessary capital when banks say no. It's about looking beyond the usual routes and finding willing partners who see the potential in your vision. Each financing method comes with its own set of risks and rewards, so carefully evaluate which unconventional financing option aligns best with the deal's needs.

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Anna Kogan

building Duckfund - soft deposit financing for commercial real estate investors
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Even when banks say yes, it’s smart to explore all options and choose the one that benefits you the most. One of the most recent creative financing solutions is Gator Lending. This solution provides finance to real estate buyers who don’t have the cash they need to make earnest money deposits. Different CRE professionals can benefit from it: investors who want to save their capital for long-term goals can still secure multiple deals simultaneously, while contract flippers can still work on deals that require soft deposits. Like this method, there are many other creative financing solutions that can make a deal more appealing and an investment more successful.

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3 Leverage Partnerships

Sometimes, the best way to bring a CRE deal to fruition is by joining forces with others. Partnerships can provide additional resources, expertise, or capital that you might not have on your own. Consider joint ventures with other investors or businesses, or even public-private partnerships if the project could benefit the community. These collaborations can lead to innovative solutions and shared risks, making ambitious projects more attainable.

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4 Rethink Space

In CRE, how a space is used can be just as important as the space itself. If a property isn't attracting interest in its current form, consider repurposing it to meet market demands. Converting office spaces to co-working venues or transforming retail spaces into experiential centers are examples of how reimagining a property's use can breathe new life into a deal. This approach requires a good understanding of both current trends and the potential of the space.

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5 Negotiate Terms

Negotiation is an art form in CRE, and a creative approach can lead to mutually beneficial terms for all parties involved. Instead of focusing solely on price, consider other aspects of the deal that could be adjusted. Flexible lease terms, property improvements, or staggered payments could be the key to reaching an agreement. The goal is to find a balance where all parties feel they're getting value, which sometimes means thinking beyond the obvious sticking points.

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6 Utilize Technology

In today's digital age, technology can provide creative solutions to traditional CRE challenges. From virtual tours to data analytics for market research, embracing technological tools can give you an edge. Use social media platforms to market properties or employ property management software to streamline operations. Technology can not only make processes more efficient but also open up new possibilities for how deals are conducted and managed.

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Anna Kogan

building Duckfund - soft deposit financing for commercial real estate investors
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Property deals can also benefit from a creative approach. With technology like blockchain-powered CRE transactions, you can achieve ultra-secure and transparent property deals. Blockchain platforms allow smart contracts that streamline the buying process by automating agreements and reducing the need for intermediaries. They also record all transaction details on an immutable public ledger that all stakeholders can view, and reduce the time and cost associated with paper-based property deals.

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7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Anna Kogan

building Duckfund - soft deposit financing for commercial real estate investors
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A creative approach to securing a CRE deal is through an LLC, which can put you ahead of the competition. It is an efficient and relatively inexpensive way to pool resources and increase investment options, overcoming issues like inflation, high interest rates, and a lack of affordable lending options. It is common practice to set up a new LLC for each property purchase, providing individual benefits for each investment, including personal asset protection, tax benefits, and access to more capital. However, it must be done correctly, so seek the help of professionals whenever in doubt.

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Yossi Pincus

Director at Aspire Property Group
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Rethink your approach and perhaps get someone externally to give some input into the project. Brainstorming and lateral thinking all play a big part in coming up with fresh new ideas.

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What do you do if your Commercial Real Estate deal needs a creative approach?

1

2

3

4

5

6

7

1 Assess Needs

2 Explore Financing

3 Leverage Partnerships

4 Rethink Space

5 Negotiate Terms

6 Utilize Technology

7 Here’s what else to consider

Commercial Real Estate

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What do you do if your Commercial Real Estate deal needs a creative approach?

1

2

3

4

5

6

7

1 Assess Needs

2 Explore Financing

3 Leverage Partnerships

4 Rethink Space

5 Negotiate Terms

6 Utilize Technology

7 Here’s what else to consider

Commercial Real Estate

Rate this article

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