Due Deligence Flashcards
Market Review and Outlook
🧠 “Where is this building located, and what’s happening around it?”
→ You’re analyzing the external environment — job growth, supply/demand, interest rates, macro trends — to decide if the area is worth investing in.
Current Lease Review
🧠 “Who’s paying rent now, how much, and for how long?”
→ You’re checking the tenants, rent levels, lease terms, and vacancy to understand the current income quality and stability.
Documentation Review
🧠 “Is this deal clean and legal?”
→ You’re reviewing title deeds, permits, legal compliance, zoning, environmental risks — everything that can legally screw you over if missed.
Property Inspection
🧠 “What’s broken, hidden, or falling apart?”
→ You physically inspect the building — checking structure, systems, maintenance history — to estimate future repairs and avoid surprises.
Financial Review
🧠 “Does the money make sense?”
→ You analyze NOI, operating expenses, historical cash flows, and compare to the pro forma — to validate the true earning power of the property.
Future Lease Outlook
🧠 “What happens to rents and occupancy in the future?”
→ You assess lease expirations, tenant rollover risk, rent growth, and market absorption — to predict future income risk and upside.
