The business plan should define the methods and goals of the business—in this case, your investment activity—by keeping it on track as a framework for decision making while the business grows in size and complexity.


Developing Your Real Estate Investment Business Plan

Aug 03, 2017

If you’re a new real estate investor, you might put off writing a business plan, thinking it is unnecessary, that your business is too small or simple, or that a business plan would restrict creative decision making. Veteran investors, however, will tell you otherwise.

Although a business plan is usually thought of as a comprehensive document to present to partners and lenders, it is no less important for its author. The business plan should define the methods and goals of the business—in this case, your investment activity—by keeping it on track as a framework for decision making while the business grows in size and complexity.

Writing Your Real Estate Investment Business Plan

A business plan should be written in the business’s initial stage, so when you’re first developing an investment strategy or considering making an investment. It will have a number of detailed sections describing your anticipated activities. No matter what those are, there are several underlying questions that all business plans address:

  • What problem will you solve?
  • Who will your customers be?
  • What will you provide them?
  • Where will your money come from?
  • Where will your money go?

There will be times when your business plan will be used to achieve a goal (usually funding)—that is, it will be part of your “pitch.” There may be specific requirements for your business plan in these situations. A lender might want to see certain financial projections, or a prospective partner may want more details about the specific aspects of your activities that will become the focus of your cooperation. Thus, business plans can vary widely in their format and contents and even a single business plan may have components that are added or removed as needed.

An investment business plan will look somewhat different from a commercial business plan, as the goals of the two types of businesses differ. But the fundamental questions are the same since your investment activities are as much a business as more traditional conceptions of it, such as retail or manufacturing. Here are examples of the sections an investment business plan is likely to contain:

  • Executive summary: The big picture of your business.
  • Goals: What you want to accomplish with your business.
  • Strategy: How you expect to accomplish your goals.
  • Management team: Who is accomplishing these goals and what each team member does. As an individual investor, your “team” might include your investment management firm, financial advisors, qualified intermediary, and so on.
  • Activities: What your business will do.
  • Resources: What your business has to work with.
  • Market: Where your business will operate—who are your customers, in what geographic areas, etc.
  • Marketing plan: How your business will expand.
  • Revenue streams: Where your business will make money.
  • Cost structure: What expenses will you incur?
  • Financials: How much money you expect to make and when.
  • Backup strategy: What you will do if complications arise.
  • Exit strategy: When your business will reach the end of its life and how you will bring it to a close.

Getting Your Business Plan Right

As we noted, a business plan is intended to guide you as your business—investing—grows, but at some point, it will probably be seen by others, for example, if you work with an investment management firm. Your business plan must be written well and reflect the reality of your activities to ensure you can convey your goals adequately. 

Special attention should be paid to polishing the executive summary, as it will make the first impression on a reader and it is likely to be read most closely. However, details are important throughout your business plan. Omission is a particularly serious danger for your business plan. You may rely on less-than-scientific methods—instincts, gut feelings, hunches, etc.—to make decisions sometimes. And while you should feel deeply confident in your dealings, ultimately, business is an economic activity governed by quantifiable regularities and best guided by an adequate plan.

None of the questions addressed in our business plan outline are superfluous. You need solid answers ready in advance—you can’t decide these things on the fly. It is a good idea to have your business plan reviewed by an expert. It should be checked for completeness, soundness, and accuracy to ensure investment activity and decisions are optimal.

CWS Capital Partners is a real estate investment management firm specializing in multifamily housing communities who can help you make the goals of your business plan a reality.

Please contact us to learn more about investing with CWS Capital Partners, or view our current offerings by completing our self-certification form for accredited or qualified investors.



The information provided here is for your general informational purposes only. It should not be considered a recommendation or personalized advisory advice. CWS has made this third party information available from authors it believes are knowledgeable and reliable resources. However, its accuracy or completeness cannot be guaranteed and sentiment may change due to legal or economic conditions.

All investments involve risk including the possible loss of principal. You should familiarize yourself with all risks associated with any investment product before investing.

Advisory services are provided by CWS Capital Partners LLC, a registered investment advisor.

Securities offered by CWS Capital Partners LLC are through an affiliated entity, CWS Investments. CWS Investments is a registered Broker Dealer, member FINRA, SIPC.

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