Financial Advisory & Feasibility Analysis
Urban One has significant experience authoring reports and documents focusing on financial, investment, and development feasibility for a variety of clients. As developers that focus on infill and redevelopment opportunities, we understand how and when public or private entities can leverage its resources to make projects happen. We have built, owned, operated, and sold retail, hotel, office, commercial, and industrial buildings in the past, and are positioned to offer consulting advice that is timely, accurate, and informed by on-the-ground knowledge of the redevelopment process.
Our financial expertise spans the core product types of real estate development (residential, office, retail, hotel, and industrial spaces), and we have levered this expertise to conduct targeted economic feasibility studies, detailed pro forma analysis, disposition and acquisition analysis, financial prospectuses, and client-driven economic reports and studies. Our typical clients are private equity firms, investment funds, banks, the Federal Deposit Insurance Corporation (FDIC), real estate development companies, research firms, and public agencies.
Urban One regularly consults on rehabilitation, redevelopment, and ground-up development projects.
Financial and Investment Analysis
Our financial and investment services include, but are not limited to:
- Fiscal Consultation / Project Feasibility:
- Revenue projections:
- Tax increment projections
- Bonded indebtedness caps
- Base year valuations and future trends analysis
- Site-specific analysis:
- Cash-flow modeling
- Complex development scenarios, including mixed-use developments with numerous capital and debt partners
- Projection of alternative financing streams:
- Joint ventures and partnerships (including PPP’s)
- Mello-Roos, Community Facility, and Assessment districts
- Market demand reports and analysis:
- Macro and micro, sub-market, and neighborhood levels
- Fiscal and economic impact studies
- Financing structures:
- Debt/equity sourcing
- Non-traditional financing structures
- Revenue projections:
- Acquisition / Disposition Analysis:
- Feasibility studies and market analysis
- Analysis of alternative financing structures
- Cash-flow and Pro Forma modeling
- Analysis of state-wide and national redevelopment programs and models
Project Feasibility Analysis
Urban One has developed and analyzed numerous project feasibility studies ranging in scope from single-family homes to high-rise mixed-use towers. Our analysis has played a critical role in advancing and repositioning projects in the current economic and lending climate. As a firm with a diverse background, we have expertise in both parcel specific feasibility studies as well as area-wide impact studies covering thousands of parcels and entire neighborhoods.
Survey and Parcel-based Analysis:
Urban One has conducted numerous parcel-based reports focusing on economic and development potential, with key factors including:
- TIF/City Revenues: we have advanced financial modeling skills and are capable of developing parcel specific models to detail how TIF and City revenues would be impacted by a proposed development project.
- Determination of Project Viability: we can provide incisive guidance to determine what level of public and private resources would be needed to make a range of projects viable – from single family homes to public infrastructure, or high-rise towers to parks – based on local conditions, City objectives, and other factors.
- Project Documentation: we understand the metrics and valuation techniques behind the economic impacts of a specific project on its surrounding area and can conduct both financial and on-the-ground evaluations to document and record conditions within existing and future project areas.
- One-on-one outreach to property owners to convey how specific redevelopment initiatives can help improve their businesses, development projects, and investments in the long-term. Our outreach efforts are, moreover, informed by our background in real estate development and a solid reputation for redeveloping several iconic buildings. This allows us to immediately establish a working relationship with most private businesses and individuals, as we understand how difficult it can be operate a small business or find enough resources to execute a project. Most firms lack this perspective and can’t generate support within the development community because they’re unable to converse in the language of real estate development, finances, and economics. Urban One bridges the gap between a diverse set of mediums and disciplines.
- Highest and Best Use Analysis:
- Zoning, density, FAR
- Construction and cost modeling for all variety of project types and construction requirements (wood, steel, concrete, etc.)
- Capable of leading an entitlement team to permit a wide variety of projects, with our specialty focusing on urban infill development
Large Scale Analysis:
Urban One has conducted large-scale feasibility studies examining thousands of parcels. Our most recent project has been to undertake a large-scale economic report comparing Downtown Los Angeles to both Portland, OR, and Seattle, WA, to demonstrate how streetcar projects play a major role in generating and attracting development. This work encompassed developing, filtering, and applying complex formulas to data sets designed to reveal how properties near transit performed at specific time intervals.
As this analysis is on-going, we are further developing a methodology to determine how transit proximity influenced the built environment through specific variables, such as: assessed property values; FAR ratios (used v. unused); rental, lease, and stabilized occupancy rates; acquisition/sale rates; and other indicators of financial performance. This work also included on-the-ground interaction with stakeholders in Portland andSeattle to gauge how companies, communities, and city governments were impacted by the streetcar system. Qualitative one-on-one stakeholder interviews are being interpreted alongside quantitative results.
Applying this work to L.A. has proven to be a challenge and has required Urban One to compile a database of over 6,000 parcels encompassing 90 million square feet of developed space. We are currently applying a similar set of variables to this land area to project how Downtown L.A. could be impacted by a streetcar system.
Excel / Financial Modeling
- Format and Layout: Model structure and set up; tab integration; summary pages; assumption pages and main linkage tabs that flow through the model with minimal additional changes or audits
- What-If Solutions: Lookup tables; data tables; pivot tables; solver; offset functions and tools
- Programming: Visual basic; macro scripting; and other automated tools to facilitate model population
- Cash Flows: Structuring models to accommodate different property types; before and after tax analysis; provision for construction changes; flexibility of timing and related assumptions; depreciation schedules; distribution/partitioning of investment returns
- Construction: Construction budget with flexibility for changes to flow into other tabs; construction loan analysis, including allowance for interest reserve calculations; equity overlays with timing assumptions; and advanced scheduling methods
- Partnerships: Complex waterfall structures with provisions for catch ups and claw backs; multiple partner scenarios with differing interests; and structures allowing for public/private partnerships and lender participation