Learning how to evaluate properties/regions
I work as a financial analyst for a private wealth manager in the bay area and we interface with many RE investment managers who come in to pitch us their latest fund. However, we don't have a very good evaluation/due diligence process (it's usually our boss who says yes or no to a fund), and I'm trying to create expand our efforts on research within the RE realm. Could someone recommend their go to's for researching market trends on things such as vacancy rates, rental rates, and any other market factors/trends that go into evaluating a commercial property? Resources that are free would be ideal.
[{"id": "f21ioij", "text": "It\u2019s a little unseemly to ask for free resources when you\u2019re charging mgmt fees on $1bb+. Not to be a dick, but better you hear it from a random stranger on the internet than silently offend a client / vendor later.\n\nThere are lots of free resources online for the metrics used. If you want up to date numbers just call a few Bay Area CRE brokers in that asset class.\n\nIf they\u2019re asking to contribute LP equity are they at least showing you their mandate and past performance? What DD are you looking to do? Funds don\u2019t necessarily know what they want to buy when fundraising, so there\u2019s no reason for you to worry about property-level metrics.\n\nEdit: typo", "replies": [{"id": "f22behq", "text": "I understand the idea of asking for free resources seems absurd, but my boss is extremely cheap, and we all find it frustrating when he could easily afford it. It leaves us in a position where we just fill in answers from a questionnaire that we use for RE, Energy, and PE funds. Most of the answers I can get from the firm's DDQ or PPM. Yet, I want to be able to gather more in-depth information. It's true we don't know what they want to buy or loan on, but we know what regions they are looking in based on our conversations and reviewing the offering documents. In this case I'd want to be able to look at anything we can that would make us more comfortable in our decision making process. I feel like if we can get more information on the market then we can at least have an idea of how it may perform.", "replies": [{"id": "f236u5d", "text": "Send me a PM if you like.\n\n\n(15 years in CRE structured finance, live in SF, own my own CRE consulting firm as of 3 months ago (started off like you so happy to help out someone on the early stages). I do a lot of work for REPE/credit funds and happy to show you a few things to make you look like a boss to your..... boss).", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "f21qknw", "text": "https://www.amazon.com/conduct-analyze-estate-feasibility-studies/dp/0442225687", "replies": [{"id": "f22bm27", "text": "Too expensive! Jk, this looks great. Thanks!", "replies": [], "depth": 2}], "depth": 1}, {"id": "f21vuwq", "text": "What types of funds come to you?", "replies": [{"id": "f22etnq", "text": "Small to large REPE firms", "replies": [], "depth": 2}], "depth": 1}, {"id": "f21watt", "text": "If they\u2019re in the PERE top 100 you\u2019ll probably be fine.", "replies": [{"id": "f22bvzo", "text": "Half of the funds we use are in the top 100.", "replies": [], "depth": 2}], "depth": 1}, {"id": "f229nhf", "text": "The big brokerage firms provide market reports for free, usually quarterly by market. See CBRE, JLL, Transwestern, and Cushman and Wakefield. \n\nNot sure that will help much in evaluating a fund offering - a strong market doesn\u2019t mean every investment into that market is smart. I acquire assets in the Bay Area and Denver, for example, and while those are strong markets the majority of the deals I review don\u2019t meet our criteria for risk adjusted return.", "replies": [], "depth": 1}, {"id": "f22dwda", "text": "What materials do the funds give you?", "replies": [{"id": "f22kyzd", "text": "The basics. General marketing material and subscription documents, LP agreements, PPM, etc.", "replies": [], "depth": 2}], "depth": 1}, {"id": "f22hifd", "text": "CRE lender here (in SF too).  CoStar and REIS are the Holy Grail of third party resources we use.  Ask them for a free trial, explaining your an XYZ LP investor.  I\u2019m sure you\u2019ll get something from them for a few weeks.\n\nThose fucking guys drill down into every CRE asset in most US markets, and have amazing narrative on cities and even neighborhoods.\n\nIt pays for itself in terms of DD time and expenses we would spend otherwise.  Blow your boss away with that shit and then make a pitch to open his fucking wallet.", "replies": [{"id": "f22kuzp", "text": "One of the smaller funds just contacted me saying exactly what you did. This helps us out a lot. I appreciate it!", "replies": [], "depth": 2}], "depth": 1}, {"id": "f3ch05o", "text": "[STDB.com](https://STDB.com) (Site To Do Business) and Costar are great resources for market data. I know its not free but I hope your cheap boss has some wiggle room.", "replies": [], "depth": 1}, {"id": "f82si2u", "text": "Commercial real estate analyst here with experience working at a large capital markets intermediary and brokerage houses. \n\nThere\u2019s a myriad of resources (most mentioned above). If your company is willing to spend money on resources, the following are the ones I like the best. \n\n1. CoStar - $$$ \n\n2. RCM; Real Capital Analytics\n\n3. Creditntell - great for market information and credit analysis \n\nCheaper or free alternatives found below. \n\n4. Udemy\n\nI am largely self taught and I bought the following course to help me model PE:\n\nhttps://www.udemy.com/course/the-real-estate-equity-waterfall-modeling-master-class/learn/lecture/11969460#content\n\n(Apologies if this isn\u2019t hyperlinked - I\u2019m on a phone). \n\n5. AdventuresinCRE\n\n6. Befriend a broker. They will want to talk to you. \n\nI work in the Bay Area in CRE, as well. Feel free to message me.", "replies": [], "depth": 1}]