Dealpath Case Study: Four Springs Capital Trust: Evaluating Billions in Pipeline Deals Efficiently and Effectively

Dealpath Case Study

Four Springs Capital Trust: Evaluating Billions in Pipeline Deals Efficiently and Effectively

Doubling AUM and Uncovering the Most Profitable Opportunities with a Lean Team

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Four Springs Capital Trust is a private REIT focused on single tenant net lease. Founded in 2012, Four Springs Capital Trust has properties in 33 states across the United States with over $1 billion in assets under management. Four Springs Capital Trusts’ investments are primarily in industrial, medical, and retail asset classes.

Deal type:

Asset Class:

Assets Under Management:

Over $1 Billion*

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*As of 2/9/22

The Problem: Screening $20B in Pipeline Deals With a Lean Team

Four Springs Capital Trust had a high-volume pipeline with over $20B in deals that fit their investment criteria, but only a small team to evaluate them. They generally offer on 10% of deals evaluated and ultimately close on approximately 1% of their pipeline. Four Springs was managing all deal pipeline activities in Excel, recreating the wheel on almost every deal, and struggling to generate clean PDF versions of IC memos, which were distributed as hard copies during IC meetings. As the volume of deals evaluated increased, they realized the need to create efficiencies and streamline deal flow in order to scale effectively and continue to grow the business.

I want maximum efficiency, and Dealpath has given me that. The amount of time it saved my team and the ability to concisely present information and eliminate the need to go back and fill in holes; I really can’t put a number to how valuable that is. We grew our portfolio significantly in such a short timeframe this past year, and we will continue to grow in 2022.

Jared Morgan
Head of Acquisitions

The Solution: Boosting Deal Volume & Velocity With Deal Management Software

After searching the market for deal management platforms, Four Springs Capital Trust found Dealpath. They immediately recognized that Dealpath would enable them to keep pace with their growing pipeline by centralizing all relevant deal data and information needed to make fast, data-driven decisions, helping their team remain organized with one single source of truth. They implemented Dealpath in early 2021.

“Dealpath gives us the ability to present key data sets and make informed decisions about whether or not to close a transaction – whether we’re screening a deal with the Acquisitions team, or presenting a memo at an Investment Committee meeting,” said Jared Morgan, Head of Acquisitions.

Four Springs Capital Trust evaluates a vast and diverse array of opportunities throughout the country, creating the need to pull both historical and new data to properly review and underwrite deals. Through Dealpath, they are able to work from standardized workflows, cross-reference real-time and historical deal information, save time and be more efficient as a team. Dealpath’s reporting and analytics enable the team to make side-by-side comparisons and uncover the most profitable opportunities. Because all real-time deal information is centralized within Dealpath, senior leadership can view their full portfolio at any time.

“I want maximum efficiency, and Dealpath has given me that. The amount of time it saved my team and the ability to concisely present information and eliminate the need to go back and fill in holes; I really can’t put a number to how valuable that is. We grew our portfolio significantly in such a short timeframe this past year, and we will continue to grow in 2022. It’s always been about how we become more efficient with the staff we have and the time we have.”

With Dealpath, Four Springs created and realized three operational efficiencies that have driven their growth both during and after deal closing:

  1. Visualizing deal information and the property itself: Prior to Dealpath, the pictures and spreadsheets of properties for evaluation were scattered. Today, all deal information is stored within Dealpath. The Four Springs team uses Dealpath to visualize the interior and exterior of the real estate assets, assess the location and analyze rent comparables.
  2. Screening tenant applicants based on credit: The Four Springs team worked with Dealpath’s Customer Success team to build out a credit template to evaluate tenants and long-term leases. They can now pull industry data on both a macro and micro level. Because their business relies heavily on single tenant net leases, they want growing, successful tenants. On Dealpath, they can efficiently evaluate and compare longterm tenant prospects.
  3. Leasing due diligence: Four Springs uses a lease checklist prior to making an offer on any property to better understand the deal structure and help mitigate risks. This checklist ensures that a deal is fully vetted before being presented to the Investment Committee.

 

Four Springs is actively engaged in the net lease market, bidding on opportunities on an almost daily basis. Because of this, they are tracking bid deadlines, due diligence periods, and other critical timelines. Once a deal is under contract, the clock starts ticking, requiring the Four Springs team to focus on significant deadlines for legal documents and due diligence checklists, which cannot be missed. The Acquisitions and Closing teams use Dealpath to keep track of all their time sensitive deals to ensure that they never miss any critical dates in any of their transactions.

The Results: Doubling AUM with $500 Million Worth of Acquisitions in 2021

Four Springs Capital Trust closed on $500 million worth of acquisitions in 2021, doubling their assets under management as a company. They attribute this phenomenal growth to their capital partners, their credible reputation and maximum efficiencies created within the organization through implementing Dealpath.

Dealpath provides visibility across the board and streamlines collaboration between executives and analysts, fostering shared enthusiasm and driving faster results. As both teams analyze and evaluate all their deals in the pipeline, the promising transactions they uncover and underwrite give them the confidence that exponential growth is indeed achievable in 2022 and beyond.

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