Properly vetting a capital advisor has become essential in commercial real estate. Picking the wrong capital advisor can make or break a deal, but with so much competition, finding the right match is a new challenge. However, there are key characteristics that a borrower should look for when vetting a new capital advisor.

"Without a doubt, never hire just your best friend nor just a brand name shop. It's the individual capital advisor who is going to see it through to the end," Malcolm Davies, principal and managing director of The Davies Group at George Smith Partners, tells GlobeSt.com. "This is a very personal business. You have to go with someone who is going to give you 100% dedication to your goals. Always review a capital advisor's testimonials and references."

A good capital advisor will manage the deal in five stages—underwriting, packaging, capital sourcing, capital structuring and closing. At the underwriting stage, the capital advisor should look closely at the presentation of the business plan. "Your advisor should recognize that how you present the numbers is as important as the numbers themselves," says Davies. "Well thought out and clearly presented models are critical." This will set things on track for stage two, packaging, when the capital advisor will create a professional presentation, along with demand drivers, to present to capital providers.

Next comes the capital souring and capital structuring stages. In the capital sourcing stage, Davies says that capital advisors, like him, should be a deal champion. "We use dinners, events, conferences, face to face meetings, conference calls and more to get capital providers focused on your deal," he says. "Make sure the people you interview can articulate their own strategy. This goes well beyond just having a long rolodex or relationships, which is fundamental, but goes to the essence of being able to get deals executed." Once working with a capital provider, Davies says, "make sure your provider has the expertise and experience to negotiate covenants, trip-up clause provisions, prepayments, etc, and has a proven track record of deal making, in which there is as much art as science."

Finally, at closing, the advisor should manage the step-by-step process. "Your provider needs to manage the property appraisal and the flow of information, and most of all, needs to ensure that momentum is maintained throughout the post-term sheet execution process," says Davies. "Time kills all deals, and this applies particularly when deals are in application. Spend time with your capital advisor to get a good feel of how they manage each of these areas. We almost consider each of these areas as sole and separate businesses and create our own structures to maximize the appropriate talent and resources to move seamlessly through the capitalization process. Ask the people you interview about their approach."