The development proforma incorporated numerous assumptions related to costs and operational aspects of various asset classes, such as hotels, office spaces, and multi-family units.
Allegro worked to validate these assumptions by utilizing market expertise, publicly available market data, and industry standards to pressure test rental rates, operating expenses, demand projections, absorption rates, and stabilization periods for each asset class. Allegro also leveraged its strong industry relationships to help the client benchmark construction costs, taking into account the rapid changes the market is experiencing as a result of constraints related to the availability of materials and labor.
Allegro then created a discounted cash flow model, incorporating the assumptions noted above, to evaluate potential levered and unlevered returns by development phase, asset class, and individual parcel development.
