Richards/Sullivan Capital Resources
Real Estate Advisors
 
 
Tuesday, June 20, 2006
 
• Carefully craft the scope of the project. The result is an in-depth understanding of the client’s objectives and priorities. The following steps outline our methodology. • Devise an approach resulting in meeting the content and format of the client’s specifications. • Identify the necessary documents and related materials and request them from the parties involved in the transaction. • Keep the client and other interested parties in the transaction fully informed of our progress throughout the process. Disclose unanticipated material factors that may have an influence on proceeding with the investment. • Determine the actual Net Operating Income results from a bottom up approach. Analyze each lease for both economic and non-economic (renewal options, cancellation options, financial limits, etc.) elements. Incorporate into the calculation the effect on the transaction of other revenues and expenses (e.g. real estate tax assessments). • Abstract the findings in a format of the client’s selection. Compare the abstracted information to the seller’s financial results. Discrepancies in the form of under or over charging are brought to the client’s attention. • Compare the projected Net Operating Income pro forma to historical results and any projections provided by the seller or the broker. To the extent possible, variances are reconciled and are identified for the client’s further evaluation. • Provide a narrative stating qualitative aspects learned during the process. • Model client’s assumptions regarding such elements as rental rates for vacant space, impact of lease expirations, growth in expenses into alternative pro forma based evaluations.
 
Process