As a property owner, there comes a time when you feel like you want to develop or reinvest in your property. Having all the cash needed to accomplish your objective can be challenging, forcing you to look for an investor to help you fulfill your desire.
You have to be very organized well plan how you are going to look for an investor to finance your project. The following tips will teach you how to find an investor for your property.
Make a business plan
If you don’t have a business plan, then you will not be able to get an investor for your property. A serious investor will consider your proposal only if you have a proper business plan. In your business plan, you should include all the vital information such as the marketing plan, your business goals, expected income, expenditure and the profit margins. Don’t forget to include the expected source of the income for the project, and the sharing of the profits between the investor and the property owner.
What is your contribution as the property owner ?
An investor will want to see what your contribution towards the property will be, before they can consider the deal. You should have this information readily available if you want to succeed in finding an investor for your property.
Your contribution may be in terms of human resource, furniture, machines or even a small percentage of the required amount.
Ask the potential investors a few questions
It is important that you to find the right investor for your property, for a successful project. There are some general questions that you can ask an investor, that will help you to choose the right investor.
Ask the investor about their experience that is relevant to the nature of business on your property, ask them to also to tell you why they feel that investing in your property is a good decision. This will help you to prevent masqueraders who may just want to take advantage of you.
How much are you willing to give up in form of shares?
Finding an investor will be mainly be determined by how much you are willing to give up in shares. Some investors may be interested in more shares, given the fact that they are financing the project, this may not go well with you as the property owner.
A 10%-90% distribution should be fair and safe, remember that you don’t want to end up losing your property to a dubious investor who wants more shares in the property and in the long run might make some permanent drastic changes that might affect the business in a negative way. It is therefore important for you to decide how much you are willing to give up in form of shares to the investor before you enter any agreement.
Find an investor who has interest in your property
The investor you approach for an investment proposal should be one who has shown interest in the property or is willing to learn more about the activities that take place on your property.
For example, it may be out of line if you approached a farmer to invest in your real estate property, you are better off approaching investors in real estate who fully understand the activities and operations in real estate.
Contact financial planners
Ask a financial planner to help you to identify the right investor for your property.Financial planners are in constant touch with a pool of investors given the nature of their profession.They can easily connect you to potential investors who may be suitable for your property.
Contact loan officers
Another avenue that you can use to find an investor for your property is through loan officers. They will often know of investors who are looking for projects to finance and are always looking for such opportunities from time to time.
You set expectations of the investor as a guide on what to look for in an investor. How much should their involvement be in the property?
Do a background search on the investor
Before you consider an investor it is advisable for you to do a background search on them and know if they have any skeletons in their closet. A good place to start from is the Internet based reference search companies such as LocatePLUS.com.Inc, USSEARCH.com.Inc among others.
You will get vital information on these websites such as criminal background, business references, bankruptcies and other important information. When doing a background search on an investor, look for any inconsistencies or absence of data, these inconsistency should be a red flag for you. The background search should guide you when choosing an investor for your property.