Underwriting a New Commercial Development Project

[Hersh Rai]

BP Community,

Does anyone have an experience underwriting a commercial new development property (i.e. multifamily apartments, commercial office space, retail space)? If so, what analyzer / strategies do you use? I am familiar with underwriting currently built / performing assets; not sure how to approach new development.

Any and all help is welcome! Thank you.

[Greg Dickerson]

Originally posted by @Hersh Rai:

BP Community,

Does anyone have an experience underwriting a commercial new development property (i.e. multifamily apartments, commercial office space, retail space)? If so, what analyzer / strategies do you use? I am familiar with underwriting currently built / performing assets; not sure how to approach new development.

Any and all help is welcome! Thank you.

I use excel for all modeling no matter what type of project. You can find some great resources and models for free here 

https://www.adventuresincre.co...

 The key to development is to work the project backwards. You need to build out your development cost assumptions and income and expense assumptions to determine feasibility before you get into the weeds and fully model the project.