Mixed Use Proforma’s – Garbage in/Garbage Out

You can make a proforma say whatever you want, no matter how fancy the format, and how big or small the file, as the majority of the real success in doing a solid proforma is what you can’t see in it, but what it is populated with.  Much like the old software/technology phrase “garbage in, garbage out” type of analysis.  This is probably one of the biggest issues in mixed use development, as we all want our projects to work, and there is no easier place to allow our own bias to ensnare us in than in the proforma preparation stage, especially on those portions of the project that are not our specialty.  When you don’t have specialist in a mixed use project from the beginning, the retail developer inflates the residential land cost and underestimates the expenses, or visa versa with a residential lead.  This is how a lot of guys who want to control the own deal, and try to build the product that they don’t know about themselves get themselves in a jackpot.  If you don’t have a specialist on the other end to catch these things, then you lie to yourself, at which point your project is doomed.  It is imperative that you get involved at the very front end professionals that can second guess your proforma from all angles of the development and product.  Without doing this, to make assumptions on product which you don’t regularly develop is a definite way to get yourself in trouble quickly.

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About taddmiller

Mixed Use and Urban Infill Real Estate Development
This entry was posted in Design, Finance, Getting it done and tagged , , , , . Bookmark the permalink.

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