Pro Forma

A pro forma is a financial projection for a real estate investment that estimates expected revenue, expenses, and returns. In multifamily, it is commonly used during acquisition underwriting and may model income, operating costs, vacancy, concessions, bad debt, capital needs, and cash flow over a holding period.

A regional operations leader reviews a 250-unit property’s pro forma before acquisition and compares projected rent growth, vacancy, payroll, maintenance, and utility costs against the current rent roll and recent operating results.

A pro forma gives operations leaders a baseline for how an asset is expected to perform. It helps teams identify whether leasing, expense control, staffing, maintenance, and capital plans are aligned with the investment strategy—and later supports variance analysis when actual results differ from projections.