investment and development case studies

if u had to do a case study for development or investments any idea of what they would potentially give u (e.g. for investments would it essentially just be a pro forma model and they just give u all the info?)

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Based on the most helpful WSO content, here’s what you can expect for investment and development case studies:

Investment Case Studies

  1. Pro Forma Models: Yes, for investment-focused case studies, you are often provided with a pro forma model or the necessary data to build one. This could include:

    • Financial statements
    • Valuation multiples (e.g., EV/EBITDA, EV/Sales)
    • Industry outlook and competitive dynamics
    • Historical and projected growth and profitability metrics
  2. Case Study Tasks:

    • Analyze the provided data to assess the viability of an investment.
    • Build a financial model (DCF, LBO, or other relevant methods).
    • Make an investment recommendation (buy/sell) and back it up with evidence.
    • Identify risks and mitigating factors.
    • Present your findings in a structured format, such as an investment memo.
  3. Key Focus Areas:

    • Valuation at entry and exit.
    • Free cash flow yield and return on growth capex.
    • Strategic rationale (e.g., cost-cutting, growth, or turnaround potential).

Development Case Studies

  1. Real Estate Development Focus:

    • You might be tasked with creating or analyzing a pro forma model for a real estate project.
    • The case study could include details on:
      • Amortization schedules
      • Single-family or multi-family unit development
      • Construction costs and timelines
      • Waterfall structures (equity bifurcation)
      • Risk quantification (scenario analysis, Monte Carlo simulations)
  2. Case Study Tasks:

    • Evaluate the financial feasibility of a development project.
    • Assess risks and potential returns.
    • Provide recommendations on whether to proceed with the development.
  3. Key Focus Areas:

    • Understanding the unique characteristics of the asset.
    • Transforming the asset physically and financially.
    • Scenario planning and risk mitigation.

General Tips for Both Types:

  • Be as granular as possible in your analysis (e.g., topline, costs, cash flow items).
  • Back up your assumptions with data and logic.
  • Clearly articulate your recommendation and the rationale behind it.
  • Be prepared to defend your assumptions and address potential risks.

These case studies are designed to test your analytical skills, financial modeling expertise, and ability to make sound investment or development decisions.

Sources: Starting in Real Estate Development, PE Case Study 48h, How to prepare for an assessment center?, Investment Banking to a Hedge fund... Can You Make the Jump?

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

yes. from my experience, it was a harvard business case on real estate (a bit dated, from 2014) so i had to make assumptions based on the current market. usually make an IC memo + a model. my model had my assumptions tab, summary tab with my sensitivities, monthly cash flows, yearly cash flows, rent roll, debt schedule. my construction financing was in my monthly and yearly cash flows. hope this helps! 

 

Assuming investments would be more of a value add deal and development a development deal?

Either way expect to be given assumptions (costs, rents /rent growth, timeline for renovations/development, etc), and you would need to build out the following (off the top of my head)

Draw Schedule based on assumptions

Pro Forma

Mock IC memo/template

Everything would be from scratch.

 

I'm assuming this is an analyst role? I'd either assume it would be a more simple deal (i.e. value add multi or something) with assumptions given. Only way to really prep is to have done cases before, but there's some cases floating around on here from PGIM and some other firms. 

 

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