Service · Select
Independent Investment Due Diligence
Every investment case is a chain of assumptions. We test each link independently, show which ones carry the return, and document where the evidence supports, qualifies or contradicts the sponsor's case.
Scope
What this analysis is for
Due diligence is often treated as a checklist. Analytical due diligence is different: it asks whether the numbers in the model are supported by the market and by the asset, and what happens to value and returns if they are not. Wert-Berater has no stake in the transaction closing, which is the point of engaging us.
We rebuild the investment case from market evidence upward, compare it to the sponsor or seller case line by line, and isolate the variances that matter. The result is a reconciliation an investment committee, lender or co-investor can read, not a volume of appendices.
Analytical framework
The assumption chain we test
- 01
Market, demand and supply
Trade-area definition, demand drivers, competitive inventory and the pipeline that will be delivered during the hold.
- 02
Competition and rent or pricing
Positioning against named competitors and whether proposed pricing is achievable on the stated timeline.
- 03
Occupancy and revenue
Stabilized occupancy, absorption pace, concessions and ancillary income, tested against observed performance.
- 04
Expenses
Operating expenses benchmarked by category, with attention to taxes, insurance, payroll and reserves that pro formas understate.
- 05
Development cost and stabilization
Hard and soft costs, contingency, carry and the path from completion to stabilized operations.
- 06
NOI, capital structure and debt service
Net operating income under the reconciled assumptions and its capacity to carry the proposed debt.
- 07
DSCR, exit and value
Coverage across the hold, exit capitalization assumptions and the resulting value at reversion.
- 08
IRR, equity multiple and sensitivity
Returns recalculated on the reconciled case, then stressed across the variables that drive them.
Evidence
Sponsor case versus independent case
Each line is tested against independent market and operating evidence, not accepted from the sponsor or seller model.
| Variable | What we test |
|---|---|
| Rent / pricing | Achievable rate at delivery, not at today's asking levels in the best competitor. |
| Occupancy | Stabilized level and the time required to reach it. |
| Operating expenses | Category-level benchmarks, including tax reassessment on sale or completion. |
| Development cost | Contingency adequacy and cost escalation through the construction period. |
| DSCR | Minimum coverage in the weakest year, not the stabilized average. |
| Exit assumptions | Exit cap rate relative to entry and to the market at the likely sale date. |
| IRR and equity multiple | How much of the return depends on reversion rather than operations. |
| Sensitivity | Which single variable, moved by a realistic amount, eliminates the target return. |
Application
Who relies on independent diligence
Investment committees
A documented, independent view to sit beside the deal team's recommendation.
Co-investors and limited partners
Verification of a lead sponsor's assumptions before committing capital.
Lenders and credit funds
Collateral and cash-flow assumptions tested before credit approval.
Boards and fiduciaries
A record that material assumptions were tested by a party without a transaction interest.
Work product
What you receive
- Assumption reconciliation: sponsor case versus independent case
- Independent market and operating analysis
- Reconciled financial model with sensitivity tables
- Findings memorandum ranked by impact on value and returns
Scope boundary. Wert-Berater does not make investment decisions, manage assets or act as an investment adviser. Our diligence informs the decisions our clients make.
Analytical continuity
After the Investment: Independent Performance Monitoring
The reconciled case from due diligence is the most useful baseline a monitoring program can have: every future variance is measured against assumptions that were independently tested.
The analytical relationship does not have to end when the feasibility study is delivered. Wert-Berater can continue monitoring the asset against the original underwriting assumptions, updating market conditions, testing coverage, identifying performance variances and maintaining a recurring analytical record.
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Individual Asset Monitoring
Most relevant here- Revenue
- Expenses
- NOI
- DSCR
- Occupancy
- Market rents
- Competitive supply
- Value
- Original underwriting assumptions
-
Watchlist Monitoring
- DSCR deterioration
- NOI deterioration
- Occupancy
- Revenue
- Expenses
- Market conditions
- Collateral / value
- Stabilization
- Refinancing risk
-
Construction Monitoring
- Progress
- Budget
- Cost-to-complete
- Schedule
- Change orders
- Draws
- Remaining costs
- Lease-up
- Stabilization
-
Portfolio Monitoring
- Portfolio performance
- Risk
- Concentration
- Market exposure
- Annual review
- Re-underwriting
- Watchlist
- Portfolio-level trends
Related analysis
Continue through the lifecycle
Discuss the analysis before you commit to it.
A briefing is a working conversation about the decision, the evidence available and the scope that would answer it. There is no obligation, and nothing is subscribed.