ABSTRACT
During the period between finding a site and executing the letter of intent, the developer develops and analyzes a very rough financial proforma of the proposed project. With a historical understanding of construction costs for the chosen product type, and market research on rents for the other projects in the areas (with due consideration for the age and quality of the pre-existing projects versus the proposed project) and operating costs for similar product, a proforma can be created to determine if the project is feasible. Even if the preliminary proforma looks promising, the project economics at this stage are best an educated guess and the project is not certain to proceed—the one-pager is merely a “gut check” on whether the developer should continue to pursue the project.
