RE #81: Chris Powers - How to Underwrite an Industrial Deal & Create Investment Memos LP’s Love

On this episode, Fort Capital CEO Chris Powers outlines the underwriting process on industrial deals from start to finish making it simple to understand whether you’re green or a seasoned veteran. This episode will provide an outline for how these deals get done and the mistakes that a lot of people make along the way so you can deal smarter in the future.  Enjoy!  For more on Underwriting, visit the Fort Capital website here.  Follow Chris on Twitter: www.Twitter.com/FortWorthChris Learn more about Chris Powers & Fort Capital: www.FortCapitallp.com (01:07) - What is Underwriting? (02:14) - Variables that Contribute to the Value in Underwriting (02:40) - Market, Demographic and their Respective Trends (03:50) - Purchase Price (04:15) - Expenses (05:04) - Modeling Expenses Out in a 5-Year Model (05:21) - Taxes & Insurance (06:15) - Tenants (07:03) - Where Rent is Today vs. the Market Rate (07:59) - Tenant Renewal Probability (09:55) - Current Vacancies (10:42) - Capital Expenditure Requirements (11:44) - Tenant Improvement Costs (12:26) - Underwriting the Capital Structure & Refinance Scenarios (13:49) - What does an exit scenario look like? (15:15) - Things People Miss and Mistakes We’ve Missed Along the Way (18:45) - How Fort Capital Thinks About the Process of Doing a Deal (19:59) - How Long the Underwriting Process Should Take (20:42) - Where We Get Most of Our Data (21:12) - Where does information live when underwriting? How is it communicated to the team & non-team? (22:58) - Final Thoughts on Underwriting (23:58) - Writing an Investment Memo (25:10) - What We Think about Presenting in Our Memos (26:12) - Reasons to Acquire (26:38) - Location Overview (27:09) - The Property Itself (27:35) - Tenant Overview (28:10) - Sources and Uses of Funds (29:02) - Financial Summary & What Investors Can Expect in Return (30:22) - Partnership Terms (31:48) - Models & Return Summary (32:17) - Property Photos & Market Map (33:02) - Conclusion & Free Resources from Fort Capital The FORT with Chris Powers is produced by Straight up Podcasts

Om Podcasten

Here, we uncover the proven strategies, insights, and inspiring stories of today’s greatest leaders in the worlds of business, real estate, entrepreneurship, and investing. Each episode’s mission is to help you to level up your entrepreneurial game by hearing directly from the men and women in the arena. Chris is able to uniquely uncover things not commonly discussed because he is an entrepreneur himself. We not only cover business, but we also cover the personal side of entrepreneurship. The Fort began in 2018 as a way for Chris to publicly explore the fascinating world of entrepreneurship. Since he was a child, he’s been characterized as obsessively curious about the world around him.  The Fort has now been downloaded over 2M times, across more than 50,000 unique listeners. Each week features conversations with entrepreneurs, Founders, CEOs, and Executives from some of the leading companies in America. Past guests have represented companies such as JLL, Hillwood, S2 Capital, Chick Fil A, Morning Brew, Founders Podcast, Tiny Capital, Permanent Equity, Fort Capital, Matthews REIS, Bonobos, and ConvertKit. 🐦 Follow Chris on Twitter: www.twitter.com/FortWorthChris 💡 Follow Chris on LinkedIn: www.linkedin.com/in/chrispowersjr/ 📹 Subscribe to The FORT on YouTube: https://www.youtube.com/@FORTpod