The first step to negotiating
an attractive deal is conducting a thorough evaluation of it,
as described earlier. By understanding a target property as
well as its seller, we gain precise knowledge of its value and
the reasons a seller’s expectations may be unrealistic.
We establish our pricing goal going in, and we don’t close
unless and until we get there!
Sadly, many real estate
fund managers think their job is finished at acquisition. If
the markets improve, then the investors make money. If they
don’t, well then “at least we have our acquisition
fees.” Henna believes that acquisition is just one opportunity
to create value during a real estate investment’s lifecycle,
and it is neither the first opportunity, nor the last. In fact,
if a manager fails to dedicate proper attention to the Identification
and Evaluation phases that come before, the Acquisition negotiation
may be moot.