Curious to hear how other's firms underwrite expenses growth. The first firm I ever worked for underwrote expenses growing at 3% no matter what. Firm two would underwrite 3% for utility growth and 1%-2% for every other expense number. Total yearly expense growth was between 2%-3%. Rent growth could be 3%. So it was mismatched in a sense. These were also opportunistic deals where we had large rent premiums modeled as well.
Curious to hear what everyone underwrites and how their firm looks at expenses?