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What do the operating statements, rent rolls, delinquency reports, concession reports, capital expense ledgers, etc, tell you about the property and its operations? What does the property pro forma really tell you? Obviously all property owners are looking for some combination of cash flow and capital appreciation, the internal rate of return. But what are the assumptions that drive the computer model, and are they realistic? A few factors to consider include inflation, rehab costs and their timing, rent increases over time, local ordinances, lender requirements, and many more.
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