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Contracts, K-1s, accreditation and legal documents, quarterly reports – the list of documents General Partners have to keep on hand for every project, and every individual investor, goes on and on.

And while every GP understands the importance of transparent and organized documentation with their investors, many firms still struggle to maintain these standards when managing a dynamic portfolio.

The reason is simple and the impact is far-reaching. Relying on traditional methods like email and Google Drive to organize countless documents and communicate with numerous investors creates disorganization, operational bottlenecks, security risks, and a potential for strained investor relations.

That’s why forward-thinking CRE firms are increasingly turning to real estate investor software to handle their documentation management and communication with investors.

As the industry embraces this evolution, this article serves as a guide, shedding light on the critical interplay between data transparency and the success of real estate GPs in an increasingly digital landscape.

You’ll come away knowing exactly how managing your documents through a real estate investor software benefits your firm, how to ensure your data is conveniently shared with investors in practical terms, and how to choose the right software to manage all your documents and data.

The challenges of maintaining data transparency using traditional tools

First, let’s unpack why relying on communication and data storage methods such as email, generic cloud drives and phone calls are limiting for real estate GPs when it comes to document transparency.

While they are straightforward for sending documents and communicating with investors on a small scale, issues arise when managing complex deals in larger portfolios. These issues include:

Lack of security

Email is highly prone to cyber attacks. According to the FBI’s 2022 IC3 Report, Business Email Compromise (BEC) scams accounted for 27% of all cybercrime-related financial losses.

Zooming into the real estate industry, between 2020 and 2022, there was a 27% increase in reports of real estate-related business email compromise attacks, according to the FBI.

While you may feel like you’re savvy and cautious enough to avoid getting hacked, you’re also dependent on your investors to safeguard sensitive information – and there’s no way to prevent them from falling victim to a phishing attack.

When dealing with sensitive information, such as subscription agreements and legal documents, being so susceptible to malicious attacks is far from ideal – especially when there is a more secure alternative.

Time-consuming manual management

Without a digital portal that centralizes all the relevant documents and information that investors need, GPs risk getting inundated with repetitive, time-consuming phone calls and administrative tasks.

As Chris Wraback, Director of Investments at Avgi, puts it: “Especially during tax season, I used to get swamped with 20-30 calls a month from investors asking really basic questions”.

This is exacerbated by the fact generic tools aren’t able to differentiate between specific types of documents. If you have K-1s, contracts, reports, and any other type of document, you’ll have to manually categorize them and assign them to different investors if using a generic storage tool.

This is in stark contrast to a dedicated real estate investor software, which automatically classifies and assigns each document to different investors, investments, and document types – making management a far simpler task.

Disorganization and inconvenience for investors

Emails can lead to disorganized information, making it difficult for both GPs and investors to find specific details or documents. This disorganization increases the risk of missing emails, leading to delays, misunderstandings, and suboptimal investor relations.

Due to these limitations, GPs are turning increasingly to real estate investor software to streamline their documentation management and transparency with investors. Let’s dive into the benefits of such software.

Document management capabilities of real estate investor software

Document management is a key part of real estate investor software, enabling real estate firms to handle all their documents – from contracts and K-1s, to investor statements and quarterly reports – in a centralized, transparent digital platform.

For GPs, all uploaded documents are automatically classified by types, and associated with specific investors and investments. With a simple toggle, GPs can select which documents are visible to investors.

On the investor’s side, they can see and download all the documents made available to them directly from their investor portal.

Let’s drill into the key capabilities of Agora’s document management tool for real estate GPs:

Bulk upload documents, smartly

Real estate firms and GPs often have to upload a large group of documents – sometimes even hundreds of them for a specific project. Manually sorting through them, classifying their type, and assigning them to different investors is as tedious as it is time-consuming.

The ״smart upload” feature in Agora’s portal automates document uploads, meaning entire document collections are uploaded, automatically identified, and classified within seconds. In addition, investors receiving the documents get automatically notified, so GPs don’t need to worry about emailing them one by one.

Lynn Glantz, Head of Investor Relations at Castle Lanterra, recounts the tremendous value of Agora’s smart upload feature:

“I can simply click and upload the K-1s as a collection of documents, and just like that, each person receives the correct K-1. Then I send the email, and it’s done. It’s just super, super, easy.”

Advanced search and filtering

The search and filtering function within Agora’s DMS enables GPs to search and filter documents by name, investment, asset, date, document type, investor profile, entity, or any other related attribute.

This feature allows GPs to find the documents they need quickly and efficiently, saving time and improving productivity.

Cloud infrastructure for max security

Agora’s document management portal boats industry-leading security measures. Here’s what you need to know:

  1. It’s secured with Amazon AWS cloud technology, which is highly secured and frequently backed up, in concurrence with advanced security standards. For added measure, WAF Firewall and two-factor authentication provide an extra layer of security.
  2. It’s constantly scrutinized, with the platform undergoing periodic external audits, penetration testing, and vulnerability scans to assure system integrity.
  3. Your data is automatically backed up, guaranteeing it’s always available, protected, and up to date.
  4. It’s built with bank-grade (256-bit AES and TLS/LLS in transit) encryption to ensure your data, documents, and communications are secure and private.

Providence Development is one of numerous real estate investment firms whose need for robust security influenced their decision to work with Agora. As Nicole Warwood, their CFO stated:

“The data security with Agora was a major selling point for us at Providence. It’s exactly what we needed. It was the pivot point in our decision-making process!”

Benefits of using real estate investor software for data transparency

Now that we’ve assessed the key functionalities of document management software (DMS), we can unpack the multiple benefits they provide real estate GPs. Some of the key benefits include:

Scale without compromising transparency

Agora’s software provides centralized and structured storage for all investment-related documents, making it easy for both GPs and investors to organize, categorize, and locate important documents.

With this drastic improvement to your firm’s organization capabilities, and to the overall administrative experience of your investors, you never need to worry about dropping your data transparency and operational standards with your investors as you scale your portfolio.

Save time on manual overheads

With automated “smart uploads” and robust search capabilities, document management software significantly reduces the time spent on manual tasks such as searching for documents, uploading, and sending them to investors.

On the investor’s side, every document is easily accessible via their online portal with the document center. Each investor portal has a document table, and they can use filters and sorting to find the right documents according to their document types, effective dates, and which investment it is related to.

Nicole Warwood, Chief Financial Officer at Providence, underlines the value of leveraging a DMS to automate and centralize documentation:

“We have around sixteen entities with all separate K-1s, and you know that’s very time-sensitive for investors. They need it right away. So what took me previously four days now takes one hour with Agora. The K-1 document distribution to investors is fully automated and secure, saving me significant time and ensuring investors can submit their K-1s on time. It’s a win-win for everyone.”

Maximize security for your documents

By shifting your management of documents from email to your real estate investor software, you instantly strengthen the security of your firm against cyber attacks. That’s because document management software employs robust security measures, and adheres to strict security standards like ISO/IEC 2700, to safeguard confidential data from unauthorized access or breaches.

How to make documents accessible in your real estate investor software

Managing your documents in your real estate investor software, and making sure they’re conveniently accessible to your investors, is straightforward. Here’s a glimpse into how intuitive the process is:

Identify all the documents that need to be accessed

Let’s say you need to upload a collection of K-1 documents. Here are the steps you need to take:

1. From the Documents page in your portal, click ‘Upload Documents’ in the top right corner.

 

2. Select the document type, the entity it belongs to, and the effective date. Here you can also add a note with any extra information for your investors.

 

3. Select the documents you want to upload from your computer’s files.

 

4. Notify investors by email via the platform.

Implement a permissions system to control who can access which documents

When you upload a document to your portal, you can control whether or not it appears in your investors’ portal, which investors get to see it, and if it requires them to log in to do so. Here’s how:

1. Click on ‘Documents’ from the header of your portal’s screen

2. Open up Collections, and select the document collection you want

 

3. Once you open up the relevant document collection, you can use the Portal Visibility toggle to choose which individual investors can see the document.

How to choose the right real estate investor software for document management

The value of using a dedicated tool for real estate document management, rather than relying on generic methods for file storage and investor communications, is clear. Better organization, full transparency, less manual overheads, stronger security, and happier investors are benefits that cannot be ignored.

But with numerous real estate investor software solutions to choose from, each with their own document management systems (DMS), how do you decide which is best for your firm? Here are some pointers:

Ensure your DMS is designed for real estate investment management

As we mentioned earlier, standard document storage tools like Google Drive or Dropbox often fall short when it comes to effectively handling investment-related documents.

Your Document Management System (DMS) needs to be able to tell the difference between various document types – think subscription documents, K-1s, and distribution notices.

On top of that, it should easily connect these different documents with the right entities, whether they’re current or potential investors, assets, or deals.

This simple but powerful feature lets you quickly search, filter, and organize your documents (or groups of them) based on these categories, making your document management a breeze.

Ensure your DMS integrates with a CRM as part of one seamless platform

Your DMS should be an integrated part of a wider, holistic real estate investor CRM.

An investor CRM is a platform that enables firms to manage investor relations. From the CRM, firms can:

  • Manage their investors’ information and contact details.
  • Interact with investors and leads.
  • Handle investor requests, assign tasks, and send documents.

Make sure to check your documents can be easily accessed and seamlessly integrated in all parts of your CRM.

Ensure your DMS integrates with your Investor Portal

The Investor Portal isn’t just another feature; it’s a crucial part of managing your documents – and of getting the most value from your DMS. This portal serves as your investors’ go-to spot for accessing all their relevant documents and information. It’s the place where they dive into data rooms, peruse brochures, e-sign legal papers, and snag reports – a central hub for all things investor-related.

By ensuring your DMS integrates seamlessly with your investor portal, you ensure its benefits – such as total transparency, better organization, and stronger security – are reaped by all parties involved.

Final takeaways

Data and document transparency have always been important for real estate GPs and their investors.

But with the risk of email hacks worsening, and the everpresent strain of maintaining the highest standards of transparency and communication with investors while juggling a dynamic portfolio, it’s no surprise that leading firms are increasingly adopting dedicated real estate investor software to alleviate these pain points.

Agora’s software covers all investment management needs for real estate investment firms, GPs, and syndicators, providing a seamless experience for firms and their investors.

Are you interested to learn more?

Author

Asaf is Agora’s Head of Marketing and a growth expert providing consulting services to tech startups and VCs. Asaf is also the host of The Deal Makers Podcast, where he hosts top CRE talents for conversations where they share their success stories and industry insights.

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