Managing numerous pipeline deals at any given time, investment deal teams are bogged down with data entry, appointment scheduling, permitting and other detail-oriented and tedious–yet essential–pieces of the broader puzzle. Some firms experiencing these constant fire drills hire real estate transaction coordinators to reduce administrative workloads. While having another set of trained eyes can create much-needed bandwidth, relying on a sole team member to manage these responsibilities can lead to new types of friction, which can become increasingly risk-prone as your firm scales. Ultimately, this approach may not lead to the same streamlined, scalable and data-first pipeline process you set out to achieve.
Read on to learn more about the void that real estate transaction coordinators fill, and considerations your firm must make when strategizing about how to scale.
What Is a Real Estate Transaction Coordinator?
Real estate transaction coordinators assist deal teams by handling tedious, detail-oriented tasks, helping them to accomplish more in a faster timeframe.
As investors source new deals and consider them based on data and analytics, real estate transaction coordinators manage tasks, approvals, paperwork and other administrative work required as deals move through the pipeline.
In some ways, shifting these responsibilities away from investment teams can allow them to prioritize important deal work. No matter who is managing them, though, real estate transaction workflows will still be prohibitively complex. As a result, this shift comes with the cost of noise, confusion and new processes that might be equally error-prone, time-consuming and unscalable.
To effectively reduce friction and close deals faster, be sure to consider how your firm can best work with greater precision and minimal bottlenecks. In many scenarios, implementing a deal management solution might prove more beneficial for your bottom line.
6 Things to Consider Before Hiring a Real Estate Transaction Coordinator
1. Challenging Labor Market In Which Job Seekers Hold Leverage
Unlike decades past, job seekers hold leverage in today’s labor market, as companies struggle to fill vacancies. Great candidates are a dime a dozen, especially as people continue to leave their roles for greener pastures.
Before posting an ad for a transaction coordinator for real estate, consider the resources involved in hiring. From uploading job postings to reviewing resumes, interviewing candidates and more, there are numerous steps that require org-wide involvement. Expending these resources could cause setbacks elsewhere, particularly if you’re also focused on hiring for vital investment positions.
2. Training Real Estate Transaction Coordinators Requires Bandwidth From Busy Team Members
After locating and hiring the right candidate, the next challenge that firms face in hiring real estate transaction coordinators is training. Before putting your deals in the hands of a coordinator, they must be proficient in real estate, but also your firm’s unique workflows.
It’s not as simple as creating a real estate transaction coordinator checklist. Because deals can become quite complex, it could take weeks or even months for them to ramp fully and add value. Remember, your goal should be to introduce process changes that build efficiencies, not necessarily raise headcount.
3. Employee Turnover
There is always a risk of employee turnover, and that risk applies more than ever in a labor market that favors job seekers. Losing a real estate transaction coordinator who’s fully ramped and familiar with your workflows could mean saying goodbye to institutional knowledge that has driven deal flow. This not only creates a new vacancy that you must fill to continue on, but your firm must restart the arduous process of hiring and training.
4. The Cost of a Real Estate Transaction Coordinator Salary
Naturally, hiring another team member requires a portion of your budget. While doing so reduces the workload for your deal team, you shouldn’t need to continue hiring as your pipeline grows. Instead of weighing down your bottom line, consider other operational improvements like deal management software, which is a more sustainable solution to the issue of slow deal flow.
5. Human Error
Even after extensive training, real estate transaction coordinators are not infallible. Because their roles revolve around data entry, date transcription and highly detail oriented updates that involve numerous dependencies, there is a high potential for human error. At the end of the day, one small mistake can still cause a setback or require the deal team to revisit updates. Similarly, overlooked emails can put pressure right back on the deal teams and leadership.
6. Lack of Sufficient Software
Having a dedicated real estate transaction coordinator offsets the brunt of administrative work that the deal team previously bore, but it often fails to address the root issues: inefficient processes, decentralized information and data and lack of real-time pipeline visibility. When deal teams want to recall a comp or surface a recent deal, the coordinator must still sift through the drive, slowing deal momentum. Similarly, when an executive wants a pipeline report, the real estate transaction coordinator’s priority becomes communicating with deal teams to obtain up-to-date information.
Systematizing processes with seamless or automated data entry, real-time pipeline tracking and analytics, and standardized workflows can grow your top-line revenue more efficiently. Deal management software can enable you to scale portfolio growth by closing deals faster and sooner, without hiring initiatives. Unlike hiring a new role, deal management software retains institutional knowledge, ensuring continuity regardless of the circumstances.
Systematizing the Due Diligence Process
To invest competitively in today’s market, deal teams need better solutions than email workflows and Excel spreadsheets.
Download our free e-book to learn why leading deal teams now rely on real estate deal management software to manage the entire process from source to close.