How Limited Partners Can Use AI to Become Better Real Estate Investors

Artificial intelligence is changing the world—and it couldn’t have come at a better time for limited partner investors.

We’re seeing a growing push from LPs to:

• Increase their understanding of private real estate investments

• Perform more substantial due diligence before committing capital

The challenge, of course, is that most limited partners have careers and commitments outside of real estate. That’s why they’re passive investors in the first place.

At Shining Rock Equity, we encourage our investors to stay engaged and informed—but we also recognize that time is a real constraint. Tools that help investors better understand deals without adding another full-time job can be incredibly valuable.

Below is a simple, practical example of how AI can be used as a research assistant to support smarter investment decisions.

Using AI for Smarter Deal Review: NotebookLM

You’ve probably heard of ChatGPT. While it’s powerful, it has a real limitation for investment analysis: hallucinations.

Anyone who has used general-purpose AI tools has likely experienced moments where the system confidently presents information that isn’t actually in your documents—or worse, makes up facts that sound plausible but aren’t true.

That’s where NotebookLM stands out.

NotebookLM works differently. Instead of pulling from the broader internet, it limits its responses strictly to the source materials you upload. That means:

• No invented information

• No guessing

• Clear citations showing exactly where each answer comes from

You can upload documents such as:

• Investment presentation decks

• Private Placement Memorandums (PPMs)

• Operating agreements

• Financial models or supporting diligence materials

Once uploaded, you can begin asking targeted questions and receive answers grounded directly in the documents.

Examples of Useful Prompts

Deal Structure

• “What are the key terms, including preferred return, profit split, and hold period?”

• “Can you walk me through the distribution waterfall step by step?”

• “How are distributions treated during the hold period versus at sale?”

Financial Analysis

• “Walk me through the sources and uses of funds.”

• “List all fees the GP may charge.”

• “What rent growth and expense growth assumptions are being used?”

Due Diligence & Risk Review

• “What terms may be least favorable to LPs?”

• “Who are the GP team members involved in this transaction?”

• “Are there inconsistencies between the offering memo and operating agreement?”

Used properly, these types of prompts can surface details that might otherwise require hours of manual review.

What NotebookLM Doesn’t Do

It’s important to be clear: NotebookLM does not replace judgment.

As an investor, you still need to decide:

• Whether the information is accurate and complete

• Whether the terms align with your personal investment criteria

• Whether the risk profile is appropriate for your situation

At Shining Rock Equity, we believe good investing comes from understanding—not blind trust or blind automation. Tools like this don’t make decisions for you, but they can help you:

• Ask better questions on sponsor calls

• More quickly identify red flags

• Focus your time on the most important aspects of a deal

Think of it as a highly efficient research assistant—not an investment decision-maker.

Why This Matters for LPs

Instead of spending hours searching for specific clauses or decoding complex waterfall structures, LPs can surface relevant information in minutes. That efficiency allows investors to:

• Go deeper on the deals that truly matter

• Engage in more meaningful conversations with sponsors

• Better understand how a specific investment fits into their broader portfolio

Investors who learn to use tools like this—alongside thoughtful sponsor selection and conservative underwriting—are likely to make better decisions while saving significant time.

At Shining Rock Equity, we view informed investors as better long-term partners. While we handle underwriting, diligence, and ongoing oversight, we encourage our investors to stay engaged and ask thoughtful questions. Tools like this can help make that process more accessible.