Underwrite a Real Development Deal

About this experience

This is a desk day, not a site day. Michael hands you the package for a land deal his firm passed on: the broker flyer, a survey, a zoning summary and rough construction bids. Your job is to build the pro forma and decide whether the numbers work.

He walks you through each section the way he would with a junior analyst: land and hard costs, soft costs and contingency, construction loan sizing, equity, rents and exit value. At the end you present a go or no-go, and then he tells you what his firm decided and why.

Your day

1. 9:00 AM

   Read the deal package

   Go through the flyer, survey and zoning summary and list every assumption you will need.

   45 min

2. 9:45 AM

   Costs

   Build out land, hard costs, soft costs and contingency using the contractor’s rough bids.

   1 hr 15 min

3. 11:00 AM

   Debt and equity

   Size the construction loan, figure the equity gap and see how interest carry eats into returns.

   1 hr

4. 12:00 PM

   Lunch

   Lunch in the office with Michael’s acquisitions lead.

   1 hr

5. 1:00 PM

   Rents, exit and decision

   Set rents from comps, run a sensitivity table and present your go or no-go.

What’s included

• Lunch
• The full sample deal package
• Your finished pro forma spreadsheet
• Sensitivity table template

Good to know

• Bring a laptop with a spreadsheet program. Basic spreadsheet skills help; finance experience is not required.
• The deal package is real but anonymized; parcel details and seller names are confidential.
• This is an educational session and not investment advice.

Your curator

Michael Reyes15 years in multifamily and mixed-use development

Michael Reyes began in commercial lending before developing his first fourplex in 2011. His firm now builds mid-rise multifamily and mixed-use projects across the Houston area. He spends most mornings on site and most afternoons with lenders and equity partners.