Inside our underwriting checklist

Most of the risk in a private real estate deal is priced in — or mispriced — before closing. Underwriting is where we try to be honest with ourselves, so the checklist below is deliberately built to talk us out of deals as often as into them. It describes our general process; it is not a promise of results, and every offering's governing documents control.

Basis before upside

We start with the entry price relative to replacement cost — what it would cost to build the same asset today. Buying below replacement cost is a structural advantage: it means new competing supply generally cannot be delivered profitably at our rent levels, which protects occupancy and pricing. If a deal only works by assuming rents rise, we treat that as a red flag rather than a base case.

In-place cash flow, stress-tested

We underwrite to in-place income, not to a pro forma that requires perfect execution. Then we stress it: higher vacancy, higher expenses, higher exit cap rates, and higher-for-longer financing costs. A deal has to survive a plausible downside — not just clear an optimistic upside — before it advances. We pay particular attention to debt: we favor moderate leverage and fixed-rate or rate-protected financing, because leverage amplifies losses exactly when markets are least forgiving.

Operations we can actually run

Because our platform is vertically integrated, underwriting assumptions are written by the same people who will have to deliver them. A management or capital-improvement plan that looks clever in a model but cannot be executed on the ground does not survive that conversation. We size capital-expenditure reserves for what the asset needs, not for what makes the return look best.

Market and downside

We favor markets with constrained new supply, durable end-user demand, and — for manufactured housing and storage specifically — an essential-use profile that holds up when household budgets tighten. Finally, we ask the least glamorous question last: if we are wrong, how do we lose money, and how much? An investment that can lose capital in several independent ways rarely reaches the shelf.

Clearing this checklist is a necessary condition, not a guarantee. Real estate is cyclical and illiquid, targets are not promises, and past results do not predict future ones. What the process is designed to do is keep our assumptions conservative and our incentives aligned with the investors who own these assets alongside us.