Venkat A.’s Post

View profile for Venkat A., graphic

IT Professional || Multifamily Investor || Guide Technology Professionals build wealth

On the way to Sherlock-ing the best deals, let's get onto our next step of the process of due diligence which is to: 💰Analyze Financial Statements & Projections📊 This step involves a thorough examination of the property's financial performance, both historical and projected, to assess its potential return on investment. Here are some key aspects to consider when analyzing financial statements and projections: Income and Expense Statements👇 Review the property's income and expense statements for the past three to five years to understand its operating performance and cash flow. Rent Roll & Capital Expenditure Analysis👇 Evaluate the rent roll, which provides detailed information about each unit's rent, lease terms, and occupancy status. Assess the property's capital expenditure history and projected capital needs for renovations, upgrades, or major repairs. Debt Service Coverage Ratio (DSCR)👇 Calculate the DSCR, which measures the property's ability to cover its mortgage payments from its net operating income. Exit Strategy Analysis👇 Evaluate the potential exit strategies, such as selling or refinancing the property, and study the projected returns and cap rates based on the property's expected value at the time of exit. By thoroughly analyzing financial statements and projections, investors can gain insights into the property's historical performance, assess its current financial health, and evaluate its potential for generating desired returns. Will catch up with you tomorrow with the third step! #realestate #commercialrealestate #multifamilyinvesting

  • No alternative text description for this image

To view or add a comment, sign in

Explore topics