The biggest business industry, real estate, is going digital at a rapid pace. Investors, brokerage firms, builders, and in fact, modern-day buyers or sellers, mostly millennials, prefer using online routes to manage and close transactions. However, it is pretty challenging for brokers or arbitrators to maintain full security when managing real estate transactions online. This is where real estate digital data rooms come in handy.
Digital or virtual data rooms are often associated with the financial sector, but they are multi-function data management solutions for every type of business. That’s why the virtual data room market is flourishing rapidly and has crossed the billion dollar mark.
What is a virtual data room? Why are businesses adopting this technology, and how has it revolutionized the global real estate sector? Let's find out!
VDR (Virtual Data Rooms) or online data room software is a digital, multi-purpose business solution primarily used as a data sharing and management platform by businesses, professionals, corporate boards, dealmakers, nonprofit organizations, and public institutions.
The term “multi-purpose” here means that virtual data rooms are designed to perform different functions for different business types or sizes.
For example, in addition to boasting all the latest data management tools, VDRs are handy for online collaboration, project handling, task management, and deal management.
Common virtual data room uses across different industries include M&As, biotech licensing, initial public offerings, risk management, board communications, joint ventures, and real estate transactions.
Virtual data room solutions simplify different processes in the real estate industry. Here are some worth mentioning benefits.
Even a small real estate firm has a large amount of data such as asset type, zoning, location, ownership, sellers'/buyers' personal information, real estate portfolio, etc. When it comes to developers, the volume of data increases significantly. When a real estate business goes digital, it is always prone to cyberattacks and data breaches, and it may lead to data loss, lawsuits, and even hefty penalties.
The best thing about virtual data room virtual data rooms is the type of cyber protection they provide. Secure digital data rooms are certified by multiple regulatory authorities like ISO, FINRA, SOC, GDPR, etc. They give you full control over how you want your documents to be shared or accessed.
When it comes to data room security, Caplinked, Ansarada, SecureDocs, Merrill Datasite, and iDeals virtual data room software are some of the globally accepted data rooms for real estate management.
A real estate broker may be involved in multiple projects at a time; the volume significantly increases in the case of real estate firms. Sometimes it becomes difficult for realtors to keep track of multiple deals and manage them all together.
Digital data rooms allow them to create multiple data rooms for every case and invite concerned parties to join. By doing so, they can:
· Easily track the progress of every single transaction
· Make sure that documents from different transactions don’t merge or get messed up
· Easily communicate with all concerned parties privately without confusing them with each other.
What's more, virtual data rooms make sure that realtors easily collaborate with their teammates, the firm's management, investors, and everyone involved in the deal. In a nutshell, VDRs allow realtors to ensure safe internal and external communication.
Whether it is a traditional real estate sale/purchase or inviting investors to finance a project, due diligence is a crucial part of the process. It includes different steps such as document verification, property inspections, title search, and time to get an appraisal.
In the case of a development project, investors may ask for digital versions of engineering documents, regulatory authority's approval, estimated return on profits, etc.
Virtual data rooms provide a shared place for everyone participating. Real estate companies can invite investors and allow them to complete due diligence at their pace.
Investors can easily access documents whenever they want from anywhere in the world. Communication tools like Q&As and built-in online meeting management tools allow real-time two-way communication. Virtual data room providers like iDeals allow you to upload and access digital versions of engineering documents/blueprints such as CorelDraw or AutoCAD files in the VDR.
Video uploading feature in virtual data rooms makes the software more exciting for realtors. They can save their clients' time by sharing HD videos of properties under discussion before inviting them to visit the premises in person. Apart from videos, they can arrange live tours through a video-calling feature, saving buyers a lot of time.
Digital data rooms, over the years, have gained the confidence of hundreds and thousands of realtors, firms, and real estate companies from all over the world. They simplify multiple business processes, give real estate firms more control over their data and transactions, provide valuable analytics and real-time statistics, and save costs.