On this episode, Fort Capital CEO Chris Powers outlines the underwriting process on industrial deals from start to finish making it simple to understand whether you’re green or a seasoned veteran. This episode will provide an outline for how these deals get done and the mistakes that a lot of people make along the way so you can deal smarter in the future. Enjoy! For more on Underwriting, visit the Fort Capital website here. Follow Chris on Twitter: www.Twitter.com/FortWorthChrisLearn more about Chris Powers & Fort Capital: www.FortCapitallp.com (01:07) - What is Underwriting?(02:14) - Variables that Contribute to the Value in Underwriting(02:40) - Market, Demographic and their Respective Trends(03:50) - Purchase Price(04:15) - Expenses(05:04) - Modeling Expenses Out in a 5-Year Model(05:21) - Taxes & Insurance(06:15) - Tenants(07:03) - Where Rent is Today vs. the Market Rate(07:59) - Tenant Renewal Probability(09:55) - Current Vacancies(10:42) - Capital Expenditure Requirements(11:44) - Tenant Improvement Costs(12:26) - Underwriting the Capital Structure & Refinance Scenarios(13:49) - What does an exit scenario look like?(15:15) - Things People Miss and Mistakes We’ve Missed Along the Way(18:45) - How Fort Capital Thinks About the Process of Doing a Deal(19:59) - How Long the Underwriting Process Should Take(20:42) - Where We Get Most of Our Data(21:12) - Where does information live when underwriting? How is it communicated to the team & non-team?(22:58) - Final Thoughts on Underwriting(23:58) - Writing an Investment Memo(25:10) - What We Think about Presenting in Our Memos(26:12) - Reasons to Acquire(26:38) - Location Overview(27:09) - The Property Itself(27:35) - Tenant Overview(28:10) - Sources and Uses of Funds(29:02) - Financial Summary & What Investors Can Expect in Return(30:22) - Partnership Terms(31:48) - Models & Return Summary(32:17) - Property Photos & Market Map(33:02) - Conclusion & Free Resources from Fort CapitalThe FORT with Chris Powers is produced by Straight up Podcasts
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