Creating a Real Estate Business Plan

From my experience, a common mistake real estate investors make is not doing enough research before jumping straight into a deal; sometimes, they simply forget to ask ALL of the right questions. Here’s my framework to make sure you have all the bases covered. I’m happy to share my editable deal analysis checklist – shoot me an email at lilian@accentir.com. - 1. Market - Supply: Current inventory and new developments entering the market. - Demand: Drivers of demand, such as population growth and business activity. - Context: External factors like adjacent markets, news, or events influencing the market. 2. Financials - Initial Investment: Development costs, acquisition costs, and capital expenditures. - Operations: Projected revenue (rental income and other streams) and operating expenses. - Financing: Debt structure, equity contributions, and cost of capital. 3. Strategy & Risk Management - Execution Plan: Timeline, milestones, and key actions to achieve the business plan. - Risk Analysis: Identification and mitigation of potential risks (e.g., leasing risks, market shifts). - Exit Strategy: Long-term goals and options for exiting the investment, such as refinancing or selling.

The recently passed "One Big Beautiful Bill" (OBBB) introduces substantial tax benefits, creating valuable opportunities for family offices and real estate investors focused on preserving and growing wealth. Understanding and acting on these changes can significantly improve your investment strategy and offer lasting financial advantages: • Permanent 20% QBI Deduction: Provides long-term tax savings for pass-through entities, increasing profitability and investment potential. • Permanent 100% Bonus Depreciation: Enables immediate deductions on property improvements and tangible assets, significantly improving cash flow. • Increased Estate and Gift Tax Exemption: Exemption limits have increased to $15 million per individual ($30 million per couple), simplifying the transfer of generational wealth. • Expanded SALT Deduction: The limit for State and Local Tax (SALT) deductions, including property and income taxes, rises from $10,000 to $40,000 starting in 2025. Full benefits apply only to individuals with modified adjusted gross income (MAGI) below $500,000 (or $600,000 for joint filers). Above those levels, the deduction gradually phases out, ultimately reverting to $10,000 once income reaches approximately $600,000. • Enhanced Affordable Housing Incentives: A 12% increase in Low Income Housing Tax Credits makes affordable housing investments more financially attractive. Investors can achieve stronger yields while contributing to community development and meeting ESG objectives. These provisions offer more than incremental tax savings. They create strategic financial opportunities for real estate investment and wealth transfer planning. Are you prepared to take full advantage of these new tax opportunities? Now is an ideal time to review your investment and estate strategies. Taking action today can secure financial benefits for years to come.

Most investors are chasing appreciation. The smart ones are locking in cash flow. While headlines obsess over office vacancies and volatile multifamily cap rates, there’s a quiet asset class outperforming in plain sight: Multi-tenant industrial & small bay flex. Think: • Contractors • E-commerce distributors • Auto specialists • HVAC companies • Local manufacturers • Service businesses that can’t work from home These are the tenants powering your local economy. And they need functional space, not luxury amenities. Here’s why sophisticated investors are reallocating capital into this space: 1. Diversified income under one roof Instead of betting on a single tenant, you spread risk across multiple businesses. One vacancy doesn’t derail returns. 2. Sticky tenants These operators invest heavily in equipment, build-outs, and location-based customer bases. Moving is expensive. Renewals are common. 3. Built-in rent growth Shorter lease terms allow rents to reset to market more frequently, creating organic annual compounding. 4. Lower management intensity than you think Compared to multifamily, you’re not dealing with clogged toilets and emotional tenants. These are business operators focused on making money. 5. Strong demand, limited supply Municipalities restrict new industrial zoning. Meanwhile, small businesses are growing. That imbalance drives long-term stability. The result? Consistent cash flow today. Compounding rent growth tomorrow. Asset appreciation over time. And a portfolio less dependent on stock market swings. But here’s the real benefit most people overlook: Predictable cash flow buys back your time. When your investments generate income quarterly without drama, you make better decisions. You stop chasing. You start building intentionally. Industrial real estate isn’t flashy. It’s functional. And functional assets create durable wealth. If you’re a business owner, executive, or accredited investor looking to balance your portfolio with recession-resistant income and long-term upside, this may be the conversation you’ve been meaning to have. The window to acquire well-located small bay assets at attractive basis won’t stay open forever. If you want to explore how this strategy could fit into your portfolio and lifestyle goals, let’s talk. Comment “INDUSTRIAL” or send me a direct message to schedule a private call.

The biggest risk in real estate credit is often not what you underwrite. It’s what you assume will happen on time. A delayed approval rarely makes headlines. Yet it changes the outcome of more real estate credit transactions than most people realise. I remember one investment with a clean title, RERA registration, strong collateral cover and an experienced sponsor. Eight months of approval delays were enough to push costs higher and disrupt execution. The asset was still sound. The investment thesis had not changed. The financing structure had. From that point, every decision became a choice between extending the loan or forcing a default that created little value for anyone. The transactions that endure are designed with room for reality—clear triggers, liquidity buffers, milestone-based resets and the discipline to respond before temporary friction becomes permanent stress. Assets create returns. Structures determine whether those returns survive reality…

Scaling your portfolio isn’t the problem. It’s what scaling hides. Real estate rewards growth. More doors, more leverage, more opportunity. But it rarely warns you about fragmentation. → More properties → More entities → More bank accounts → More advisors → More complexity At some point, the portfolio starts growing faster than the plan holding it together. This is where many operators feel both successful and unsettled. From the outside, the numbers look great. Inside, things feel disconnected. When deals are optimized individually but not aligned collectively, complexity compounds. → Cash flow looks fine → Properties are performing → But decisions take longer → Risk is harder to track → And clarity starts to fade You don’t see the inefficiency on a P&L. You feel it when a simple decision like a refinance or sale turns into a web of conflicting details. This is the hidden cost of fragmentation. And it only grows with scale. Future planning for real estate operators is not about chasing the next deal faster. It is about designing a structure where each new deal strengthens the whole. That is where true leverage lives. Alignment does not slow growth. It stabilizes it. It simplifies it. Where in your portfolio is alignment missing and what would change if it was in place?

Had a strategy session last week with a client earning about $700K a year. Strong income. And on paper, his position looks great. 9 residential properties. Plus an SMSF residential asset. Plenty of equity. Plenty of options. His goal though is very clear: Step back from work by 2030 and live off $250K NET income. So we pulled the portfolio apart properly. Here’s the uncomfortable truth: Even if he retired with minimal debt, his current residential-heavy portfolio still wouldn’t get him there. Not because it’s bad. But because it’s doing the wrong job. Residential is excellent for growth. It’s average for income. And it struggles to replace a high salary inside a short timeframe. At his level, the question isn’t “Will this portfolio grow?” It’s “Will this portfolio actually pay me what I need to live?” The answer was no. So we changed the plan. Instead of adding more residential and hoping rents catch up, we shifted the portfolio from growth to income. That meant introducing two commercial assets. Roughly $3M each. Targeting 6–6.5% net yields. Long leases. Triple-net where possible. Clean, predictable cashflow. On their own, those two assets form the backbone of the income plan. But the real leverage came from what we sold to fund them. We didn’t sell randomly. Sale one: his old owner-occupier. Why? Because a large portion of the capital gain is CGT-free. Same sale price as an investment property, very different number after tax. Selling an old PPOR is one of the most tax-efficient ways to free up capital. Ignoring that is a mistake. Sale two: a residential asset with huge equity… and one of the lowest rental yields in the portfolio. It had done its job from a growth perspective. But the rent never kept up. Great for net worth. Terrible for income. Now here’s the part most people miss: We didn’t just recycle all that capital straight into new deals. First move is to wipe his owner-occupier debt completely. That alone freed up about $6,500 a month. No tenants. No vacancy risk. Straight into the bottom line of his personal P&L. Then, with the remaining capital, we moved into the two commercial assets. Higher yield. Longer leases. Less management noise. Income that actually moves the needle. When you map it out properly, the outcome is simple: - Residential got him wealthy - Commercial gives him income - CGT-free capital made the transition efficient - Clearing non-deductible debt increased certainty This is the mistake I see all the time: People keep buying the assets that worked in their 30s, even when their goals have shifted to income, certainty, and time freedom. Growth gets you there. Income lets you stop. Different phase. Different tools. Residential got him this far. This reshuffle is what gets him across the line.

𝗛𝗼𝘄 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗦𝘁𝗿𝘂𝗰𝘁𝘂𝗿𝗲 𝗖𝗵𝗮𝗻𝗴𝗲𝘀 𝘁𝗵𝗲 𝗦𝗮𝗺𝗲 𝗗𝗲𝗮𝗹 – 𝗣𝗿𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗘𝗾𝘂𝗶𝘁𝘆 When evaluating a deal, capital structure plays an important role in how well an investment actually performs. Two investments can show identical unlevered returns, yet behave very differently once real capital is layered into the stack. The difference comes down to how risk, timing, and flexibility are distributed between debt and equity. 𝗘𝘅𝗮𝗺𝗽𝗹𝗲 An operator is acquiring a 250-unit multifamily property for $100 million, or $400,000 per unit. Two financing structures are being evaluated: 𝗦𝗰𝗲𝗻𝗮𝗿𝗶𝗼 𝗔 – 𝗦𝗲𝗻𝗶𝗼𝗿 𝗱𝗲𝗯𝘁 𝗼𝗻𝗹𝘆: • 65% LTV • 5.50% fixed interest rate • 30-year amortization 𝗦𝗰𝗲𝗻𝗮𝗿𝗶𝗼 𝗕 – 𝗦𝗲𝗻𝗶𝗼𝗿 𝗱𝗲𝗯𝘁 + 𝗽𝗿𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗲𝗾𝘂𝗶𝘁𝘆: • Senior loan at 60% LTV • Additional $20 million of preferred equity (bringing total leverage to 80%) • Preferred equity priced at 8% cash pay and 6% PIK/accrual for a total coupon of 14% Accounting for fees and timing of payments, the cost of capital in Scenario A is 6.74%, while the blended cost of capital in Scenario B increases to 9.08%, meaning the total debt service is higher. So why would a sponsor intentionally choose the more expensive structure? Because capital structure isn’t just about minimizing cost, it’s about positioning risk and execution flexibility across the lifecycle of a deal. The right capital structure defines: • how much cushion exists if performance slips, • how refinance risk is absorbed, • and how exit proceeds ultimately get allocated. Preferred equity may increase the overall cost of capital, but it can also: • bridge capital gaps when senior lenders won’t stretch, • improve senior lender comfort by reducing senior leverage and increasing DSCR cushion, • preserve sponsor ownership by avoiding additional common equity dilution, • improve refinancing optionality by lowering the senior loan balance, • and introduce cash flow flexibility through structuring features such as accrual components. In practice, preferred equity often appears when senior lenders cap leverage based on risk, meaning the structure reflects lender constraints as much as sponsor strategy. These benefits come with tradeoffs. In terms of order of repayment, preferred equity sits above common equity, which reduces the profit pool available to sponsors and investors. The same structure that improves feasibility can compress returns if the deal’s upside is limited. This is why strong projected returns alone don’t make a deal financeable. A structure must work across multiple scenarios – base case, downside, and exit – not just under ideal assumptions. From a capital perspective, the question isn’t simply, “what are the projected returns?” But also “𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝘀𝘁𝗮𝗰𝗸 𝘀𝘂𝗽𝗽𝗼𝗿𝘁 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 𝘄𝗵𝗲𝗻 𝗿𝗲𝗮𝗹𝗶𝘁𝘆 𝗱𝗲𝘃𝗶𝗮𝘁𝗲𝘀 𝗳𝗿𝗼𝗺 𝘁𝗵𝗲 𝗽𝗹𝗮𝗻?”

Most real estate deals look great on paper. Until the market shifts… and the spreadsheet fantasy falls apart. Over the last 20 years, I’ve reviewed hundreds of investor decks. Most of them had one thing in common: 80%+ leverage Exit caps based on hope, not history Developer fees paid before the deal performs That’s not a strategy. It’s a liability. At GIS Companies, we flipped the structure: We build for resilience. Here’s what that looks like: → 60–65% loan-to-cost → Double return of capital before profit splits → Developer (me) is last to get paid Yes, it’s slower. Yes, it takes more discipline. But it’s how we’ve survived multiple market resets and still had upside to share. Because here’s the truth: When the market turns, your downside protection matters more than your projected IRR. Staying in the game is the strategy. Curious how our model actually works? Happy to walk through a real deal.

A property can generate rent every month and still be a poorly managed investment. That sounds contradictory, but it happens more often than investors realize. One of the most common misconceptions in real estate is assuming that Property Management, Facilities Management, and Estate Management are interchangeable functions. They are not. Each serves a different layer of asset performance. PROPERTY MANAGEMENT — Operational Layer Focus: tenants, rent collection, occupancy stability, issue resolution. Primary outcome: consistent cash flow and tenant retention. FACILITIES MANAGEMENT — Structural Layer Focus: infrastructure systems and physical functionality of the building. Includes: electrical systems, plumbing, safety compliance, waste systems, security, maintenance standards. Primary outcome: preservation of the asset’s condition. ESTATE MANAGEMENT — Strategic Layer Focus: the property as an investment vehicle. Includes: valuation positioning, regulatory alignment, lease optimization, development planning, long-term value growth. Primary outcome: capital appreciation and portfolio strength. Why this distinction matters When these roles are misunderstood or merged into one function: • Operational tasks replace strategic oversight • Technical deterioration goes unnoticed • Value-adding opportunities are missed • Returns underperform market potential The most strategic investors don’t ask who manages a property. They ask what level of management it’s under.

In Multi-City Real Estate, Sales Must Update Marketing, Not the Other Way Around. In many organisations, marketing is measured on leads. Sales is measured on closures. But the real leverage lies in the feedback loop between the two. In digital-first businesses, user journeys are tracked end-to-end. Real estate is different. Once a lead comes in, most of the journey moves offline, site visits, negotiations, multi-stakeholder approvals. Which makes feedback even more critical. At DevX, we operate across cities. Alignment does not happen naturally. It has to be designed. Our Structural Model --------------------- Marketing shapes narratives and generates inbound leads, Inside Sales acts as the bridge — qualifying every lead with predefined criteria. But discipline starts after qualification. Non-Negotiables ----------------- If marketing generates 1,000 leads in a quarter: 1️⃣ Every lead receives first response under defined TAT (for us: under 10 minutes). 2️⃣ Every lead is categorised clearly: • High quality • Not high quality And “not high quality” must include structured reasoning. The 200 vs 800 Rule --------------------- If 200 out of 1,000 are high quality: The remaining 800 must include: • Budget mismatch • City mismatch • Timeline mismatch • Decision authority mismatch No guessing. The 200 high-quality leads must capture: • ICP category • Decision-maker hierarchy • Stakeholders involved • Stage of maturity In real estate, where decisions happen offline, this intelligence is critical. Marketing cannot track boardroom conversations. Sales must document them. Quarterly Reset ---------------- Once every quarter, sales and marketing sit together to review patterns: • Are we targeting the right ICP? • Are we overselling narratives? • Where is friction emerging post site-visit? • What objections repeat? Without this rhythm, silos return. What Changed -------------------- * Faster first response * Sharper lead classification * More precise ICP targeting * Faster narrative refinement * Early visibility into deal friction Alignment is not about proximity. It is about designing the feedback loop. Marketing generates interest. Sales generates intelligence. In real estate, that intelligence determines growth. This worked for us. Yash Shah Pinakin Vitkare