I am a multifamily developer (urban, podium, class a) at a Boutique shop in the Intermountain West. I am having a tough time making deals pencil in the Northwest with my current understanding of the marketplace.
If your firm was starting design on a project today what would your baseline underwriting assumptions be? I'd love to hear different perspectives from debt, equity, brokers, etc.
Here are mine assuming 12 month design, 20 month construction period, and 16 month hold period post construction:
Escalation: 10%
Bank Note (fixed): 6.5%
LTC: DSCR constraint at 1.25x
Exit Cap: 5.0%
Rent/Exp Growth: 3.0%
Thank y'all!
Hi BigBigDeveloper, any of these discussions helpful:
More suggestions...
I hope those threads give you a bit more insight.
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