The underwriting process is a detailed and systematic analysis of a potential borrower’s creditworthiness, including employment history, salary, financial statements and performance, publicly available information, independent credit reports and this involves both quantitative and qualitative analysis. Though quantitative analysis of structuring or developing the net operating income (NOI) or cash flow is an pivotal step in underwriting of a commercial real estate (CRE) property, many qualitative judgments feed into the estimation of property cash flow, coverage, and value that supplement the quantitative analysis. Moreover, quantitative aspects cannot be concluded without understanding the qualitative factors underlying the deal as commercial real estate operates in an ever-changing market dynamics including surrounding properties, demographics, and local, regional, and national economics.

The client, premier advisory firm based in Atlanta, GA, needed a suite of analytics and modelling capabilities that would support an efficient and streamlined commercial property underwriting workflow for a three portfolios in a short span of time. This required the support of professionals to process road map to ensure scalability of work flow and ensure smooth coordination of work with minimal front end support.

• Underwriting two portfolios totaling 105 properties located across Northeast region.
• Total deal value amounted to $600M within a TAT of 3 weeks
• Property types covered includes Multifamily and Office.
• More than 10 third party documents and proprietary reports to be analysed, reconciled for each deal and assumption carefully summed up.

• Standardized the approach including creation of tailor-made models, process manuals for writing credit reports, reporting of performance for funds and financial cash flow models.
• Reviewed third party reports and provided commentary; Borrower credit analysis, including examination of ownership structure, financials, and experience; Assessed adequacy and experience of property management company; Market and Submarket analysis; Identified strengths/weaknesses, abstracted leases and ensure risks are appropriately mitigated.
• Underwritten the deals and prepared ASR based on the industry/client guidelines. The process map ensured scalability and the team could double the productivity in three weeks and thus, successfully completed underwriting for 105 properties valuing $600M.
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• Creation of a sustainable offshore business model and reduced turnaround time by 60%.
• Leveraging Neptune’s expertize, the consulting firm was able to help the lender acquire the portfolio on time and helped them save substantial amount on the deal.
• Ensured clients focus on their core business activities and scalability, enabling more efficient and flexibility to manage capacity.

“Truly appreciate your team’s commitment. Neptune resources have been flexible and reliable in assisting us complete the project in a short span of time.”