These expenses are foreseeable and should have been included in the original pro forma.

Sellers are putting out pro forma’s with 3% vacancy allowances and other such nonsense.

If the new inventory is comparable to the syndicator's property then this may result in the syndicator having to lower rents below pro forma to win the new tenants, and thus lowering returns from what was originally expected...potentially significantly.In addition, if the syndicator does not have a footprint in a certain market it’s also possible that they are not connected with the broker community in that market.

Every opportunity is slightly different but generally the preferred is what comes out to investors prior to the sponsor sharing in any of the upside as per the terms of the offering, - whereas target annual cash is what the predicted cash flow to investors  will be as per the pro forma calculations.

Take the case for land - when we first started working in this market lots were going for $15k and this is what we budget for in our pro formas. 

I've run a pro forma on most of them and found a couple that will work.

The broker’s pro-forma showed NOI of $51K, however, when I dug into the income statements, actual NOI was only $36K.

My GP experience has not yet gone full cycle.As a LP investor, the deal missed the pro forma. 

In short, Ill take conservative and realistic (singles and doubles) all the time over the home run pro-forma thats sure to crash and burn (well maybe not quite that bad, but I do like to hear 'good news' and have my team under promise and over deliver rather than make excuses for promising a huge win and delivering sub-par performance).

Clients receive the amount on the pro forma provided .