Due Diligence and Checklists

I was very surprised to read a while ago that the single most important element that contributed to lowering complications and death rates in major surgeries was the use of a checklist.

Actually, a 19-point checklist now is being used before beginning any surgery to make sure the medical staff did the essential things, like give anesthesia and check for other basic problems before the operation.

We all know that every pilot in the world uses a checklist before taking off. We also know that no matter how smart we are we must follow certain rules, and guidelines to ensure we don’t miss anything no matter if it is a routine or a new task.

In brainstorming and surveying hundreds of members at CMREI we discovered that the common denominator of failure and loss in the worlds of Business, real estate investing, and trading is a lack of thorough due diligence and/or the lack of use of checklists.

I have made the effort to develop a due diligence checklist with 10 key elements that one must review with a series of checkpoints below each element to make certain investors don’t miss anything when it comes to a commercial real estate deal.

Often a real estate opportunity looks exciting on paper. But when it comes to the reality of the numbers, only an objective method following facts and figures along with an empirical observation can truly expose the truth.

In 2012 I intend to continue holding a live event once a month in different cities in the US to do a full day of case studies on commercial real estate deals. If you attended any of these events you know that I demand from the attending students (members of CMREI.com) to make sure they follow my checklist regarding the property they bring for me to analyze live.

I can do it in front of everyone within minutes and we can all conclude if it is a profitable deal or not just by using the general checklist.

I have also developed a specific checklist by type of commercial property to ensure no one fools himself/herself into purchasing a commercial property of any type that does not provide the asset safety, the cash flow solvency, the liquidity, and proper cash reserves necessary for the ongoing and upside success.

Use checklists and you will find out that your success ratio will double no matter if you are a novice or an expert investor.

See you at my next live event soon,

Sincerely,

Cherif Medawar