Private real estate opportunities rarely follow a perfect pro forma. This checklist presents ten questions investors can use to evaluate a manager’s approach, assumptions, alignment, risk controls, experience, and transparency.
Questions 1 through 5 cover projected IRR and MOIC, exit cap rate assumptions, manager co-investment, competitive advantage, downside protection, leverage, cross-collateralization, guarantees, and stress testing.
Questions 6 through 10 address lessons from past deals, current and former investor references, company funding and balance-sheet strength, team incentives, and fee transparency. A bonus question asks whether the sponsor or manager has audited financials.
Article credit: Michael Episcope, Co-CEO, Origin Investments Group, LLC. Consolidated from an article originally published on The White Coat Investor.
