AI Due Diligence for CRE: Complete Guide

I tested a different approach. I fed an entire DD folder into Claude Code (Anthropic’s terminal-based AI tool), wrote one prompt, and six AI agents produced a document inventory, red flag report, seller questions, DD checklist, CapEx budget, and acquisition simultaneously. The deal was a 14-unit multifamily in Venice, CA, at $5.9M. I run the AI for CRE Collective (540+ members testing AI on real CRE workflows), and this was the most ambitious single-prompt workflow I’ve run to date. This guide walks through every step of that process, what worked, what I’d do differently, and how to replicate it on your own deals.

Why Traditional DD Takes So Long

The typical DD process for a multifamily acquisition looks something like this: you receive a DD package from the seller or broker. You open the folder. There are 15-40 documents in various formats. Some are PDFs, some are scanned images, some are spreadsheets.First, you figure out what you have. Then you figure out what’s missing. You build a checklist. You start reviewing each document individually. Financial documents get their own analysis. Legal documents get flagged for attorney review. Environmental reports get checked for red flags.Along the way, you’re building seller questions. Every time something doesn’t add up, or a document is missing, you write it down. You organize those questions by priority. You estimate renovation and CapEx costs based on property condition and planned improvements.

And then you underwrite the deal. Input assumptions and build scenarios. Check returns against your targets.Each of these tasks requires focus and attention. You can only do one at a time. A thorough DD review on a single deal takes an experienced analyst 20-40 hours, depending on the complexity and the quality of the DD package.The bottleneck isn’t intelligence. It’s bandwidth.

Claude Code vs Traditional CRE Due Diligence Workflow

Using Claude Code shifts CRE due diligence from a slow, sequential process to a fast parallel workflow where multiple AI agents complete analysis at the same time.

What You Need Before Starting

Before you sit down to run this workflow:

• Claude Code is installed on your computer. This runs in the terminal (the command line interface on your Mac or PC). If you’ve never used the terminal before, the Claude masterclass in the AI for CRE Collective covers setup from scratch.

• A DD folder on your desktop or an accessible location. All the due diligence documents for the deal. Rent rolls, P&L statements, property condition reports, ADU plans, and environmental reports. Whatever you have. Claude will read all of them.

• Your acquisition criteria. Purchase price or target purchase price. Return targets (IRR, cash-on-cash). Hold period assumptions. Any hard filters you apply to deals.

• 15-20 minutes. About 5 minutes for setup and planning, 10-15 minutes for execution.

• Claude’s latest model (Opus 4.6 or newer). The results are significantly better on newer models. If you’re running an older version, update before running complex workflows like this.

You don’t need coding experience. You don’t need a CS degree. I’ve been in real estate my whole life, and I learned this through practice (like going to the gym,  reps make you stronger).

Step 1: Organize Your DD Folder

Put all your due diligence documents in one folder. Keep it clean. Name the folder something descriptive, like “123 Main St DD” or the property name.Claude Code will scan every file in the folder. It can read PDFs, Excel files, Word documents, and image-based documents. The more organized your folder is, the better Claude’s document inventory will be. But it still works with messy folders. It’ll just take slightly longer to parse everything.For the Venice deal, I had rent rolls, a trailing 12-month P&L, ADU option drawings with specifications, and several other property documents. Everything went into one folder on my desktop.

Quick Tip on File Naming

If your files have descriptive names like “Rent_Roll_2024.pdf” and “T12_PL_Statement.xlsx,” Claude will categorize them faster and more accurately than if they’re named “Document1.pdf” and “scan_003.pdf.” Not required. Just helpful.

Step 2: Activate Plan Mode in Claude Code

Open your terminal. Type “Claude” and hit enter. Claude Code launches.Now the critical step: hit shift+tab until you see plan mode activated. This changes Claude from “just execute whatever I tell you” mode to “analyze, ask questions, plan, get approval, then execute” mode.

Why does this matter
Because the alternative is Claude making assumptions about your deal. If you don’t tell Claude the purchase price, he’ll guess. You don’t specify which scenarios to model; it’ll pick one. And if you don’t clarify your return targets, it’ll use some default.Plan mode adds 3-5 minutes to the process. It eliminates hours of fixing outputs built on wrong assumptions.I’ve tested both approaches across dozens of workflows. Plan mode has better results every time for complex, multi-deliverable tasks. For simple single-task requests (extract a rent roll, summarize this document), you can skip it. For full DD analysis? Always plan.

Step 3: Write the Master Prompt

Here’s the structure I used. You’ll customize the specifics for your deal:

The prompt tells Claude:
“I have a due diligence folder at [location on your computer]. Please do the following in order:

1. Ingest and organize all files. Create a document inventory showing what’s present and what’s missing.

2. Underwrite the deal using these assumptions: [purchase price, hold period, return targets, rent growth, expense growth, cap rate assumptions].

3. Prepare a comprehensive DD checklist categorized by type.

4. Prepare a red flag report identifying anything concerning in the documents.

5. Prepare seller follow-up questions prioritized by urgency.

6. Build a renovation and CapEx budget, including construction estimates for any planned improvements.”

That’s one prompt. One message. Claude handles the rest.

The key is being specific about your assumptions. Don’t say “underwrite the deal.” Say “underwrite the deal at $5.9M purchase price, 5-year hold, model both 14-unit as-is and 14-unit plus 3 ADU scenarios, target 16% levered IRR and 5% average cash-on-cash.” The more specific your assumptions, the more useful the output.

What I’d Add Next Time

Tell Claude what file formats you want upfront. I didn’t, and it defaulted to markdown files (which look ugly). Include this line in your prompt:
“Produce all reports as Word documents and all spreadsheets as Excel files with proper formatting.”
Saves you a conversion step later.

Step 4: Answer Claude’s Questions

After you paste the prompt with plan mode active, Claude will come back with questions. On the Venice deal, it asked three:

1. “Do you have an existing price or contract price for this deal? If not, I’ll solve for the max purchase price that hits your return targets.” I answered $5.9M.

2. “Should I model this as 14 units only at stabilized occupancy, 14 units plus 3 ADUs, or both scenarios?” I said both.

3. “Where do you want the output files saved?” I told it to save everything in the DD folder.

Your questions will vary based on your prompt and the documents Claude finds. If it asks about something you don’t know, say so. “I don’t have that number. Use market assumptions for Venice, CA multifamily.” Claude will work with what it has.

Step 5: Review and Approve the Plan

Claude writes out a detailed plan. On my deal, the plan covered:

• Property summary with extracted deal details

• Documents available vs. documents needed

• Acquisition pro forma structure with both scenarios

• Baseline assumptions it would use

• DD checklist methodology (categories, tracking approach)

• Red flag identification criteria

• Seller question priority framework

• Renovation and CapEx budget methodology

Read the plan. If something looks off, tell Claude to adjust. “Change the hold period to 7 years” or “add a third scenario with only 2 ADUs.” Once you’re satisfied, hit approve.

This is the last human checkpoint before Claude starts producing deliverables. Take 2-3 minutes to review it carefully.

Step 6: Let the Agents Execute

After approval, Claude launches multiple agents in parallel. On my deal, it ran six agents simultaneously:

• Four agents writing Word documents (document inventory, red flag report, seller questions, DD checklist)

• Two agents building Excel spreadsheets (pro forma and CapEx/renovation budget)

You’ll see agents launch in your terminal. Files start appearing in your output folder. You don’t need to do anything during this phase. You could open another terminal and start a second deal while the first one processes (that’s where the productivity really stacks up).

The execution phase on my deal took about 5-8 minutes for all six deliverables. Your timing will vary based on the number of documents and the complexity of the analysis.