Of course, I love striking deals – after all, I wouldn’t be in the real estate investment industry if I didn’t. And over the years I’ve been involved in many, many different kinds of negotiations – some complex, some relatively straightforward. There have been a lot that I’ve been pleased with, while there are others that, on reflection, I perhaps could have improved on.

But whatever their outcome, I’ve always tried to learn from both my successes and my mistakes. For me, it’s a process of then trying to take those lessons into the next negotiation I go into, and of always trying to improve every time I negotiate. So, with that in mind, I thought I’d share just a few of the things that have become clear to me about deal making over the many years I’ve been negotiating with others.

Both sides need to think they’ve ‘won’

One of the most fundamentally important things that I’ve come to realise about deal making is that it is essential for both sides leave the table feeling that they’ve gained in some way. Whether you characterise this as ‘winning’ or not is up to you – I prefer not to think of it that way as it implies that someone has come out of the negotiations on the losing side.

The key, for me, is really around value – and the sense that each party has, as they shake hands at the end of the deal, that they have gained some sort of value from the process. For the real estate investor, this might be the feeling that they’ve got themselves a property that will increase in monetary value, or that will provide them with a regular rental income. For the developer, the added value could be financial funding for the project, but it could just as easily be the expertise you can provide, or the new business connections you can bring.

A crucial insight here is that actually for many people, a successful negotiation is not necessarily just about the money. Of course, the money side of the deal needs to work – nobody enters into an agreement to make a financial loss – but sometimes you will find that their motivations are actually running far deeper than you might have first suspected.

So much of business is about relationships: those closely held connections between people that can take so long to build but which can also be broken so quickly. The art of striking a deal then, often comes down to managing those relationships closely – and much of this is about ensuring that neither side feels that they are losing out.

Motivation matters

Which brings me to my second point: motivation. This for me is one of the most crucial aspects of dealmaking and it comes down to using of the most important skills that a business person can have – listening. Listening is a fundamental part of any deal making process – by listening hard and listening actively, and by asking the right questions, we can begin to find out more about the motivations behind the other person’s strategy.

And often, you’ll find that these may not even be what they originally came into the negotiating process with – as the process evolves you may discover that there are a number of underlying motivations which are less obvious but which slowly reveal themselves as the process goes on. Listening properly to the other party, asking the right questions and working with the other person can reveal what these are – and in turn give you some powerful levers in any future negotiations as you progress towards a potential outcome that ultimately satisfies both parties.

Be creative

The third and final lesson which I’ve learned over the years about deal making is that it always pays to be creative. Again this often comes down to people, and the quality of the team that you have working on the deal itself. How do these individuals work together? What kind of synergies are created between the different members of this team and the people that you are negotiating with? And how, crucially, are these synergies creating value, not just for you, but also for the person who you’re proposing to do any eventual deal with? Understanding the answers to these questions, and consequently taking a more creative approach to the negotiation process can create the breakthroughs that everyone is looking for.

Of course, so much of negotiation and deal making comes down to your own judgement – and your own self control. You alone are in a position to really say how much risk you’re prepared to expose yourself to with any investment – and so it is absolutely crucial that you are always completely honest with yourself at all stages of the deal making process.

So, set your boundaries early – how much you want to gain, and how much you’re prepared to give up to achieve this – and don’t talk yourself out of them in the heat of a negotiation. These boundaries define the lengths you’re prepared to go to achieve the aims of the overall investment strategy you’re committed to.

Remember to keep that sense of perspective, and bring it to every decision you take as you try to strike a deal that’s good for everyone.