Underwriting & diligence
A full underwrite of a single property or small portfolio: verified expense lines, rent evidence, mechanical exposure, and a model you can drive yourself.
Why it is done this way
Most seller pro formas are not dishonest. They are optimistic in four places at once — market rent instead of in-place, no vacancy, no management fee because the owner self-manages, and no reserve because nothing broke last year. Each is defensible alone. Together they overstate net operating income by a third.
Our job is to put each of those back and show you the difference. Sometimes the deal survives it. When it does, you own an asset you understand.
The capital schedule is the part clients are most often surprised by. A 1972 fourplex with four original condensers is carrying a five-figure liability that no line in the seller’s statement mentions, because it has not happened yet.
How it runs
Verify the income
Rent roll where one exists, market evidence where one does not, and an explicit statement of which we used. In-place and market rent are different numbers and mixing them is the most common error in a seller pro forma.
Rebuild the expenses
Actual tax bill from the assessor, real insurance quotes rather than a percentage, HOA from the CC&Rs, and a defensible reserve. Seller-supplied expenses are treated as a claim, not a figure.
Price the capital
Ages on every major system. In this climate a condenser is a 12-to-16 year asset, not a 20-year one, and an insurer will have an opinion about a 22-year-old roof.
Stress it
What a fifty-basis-point move, a five percent price move, a two-month vacancy and a rate reset each do independently — and what two of them together do.
Questions we are asked
Is this an appraisal?
No. An appraisal is a licensed opinion of value for a lender. This is an investment underwrite: what the asset earns, what it costs to hold, and what is left. The two answer different questions.
Will you tell me whether to buy it?
We will tell you what it earns under assumptions we can defend, and where the model is fragile. The decision, and the risk tolerance behind it, stays with you. This is not investment advice.
Not investment, tax or legal advice. All returns shown are estimates produced by a model from assumptions you can change, not offers, appraisals or guarantees. Real results differ. Consult your own licensed advisers before acting.