When the Pro Forma Meets Reality
Bridging the Gap Between Pro Formas and Property Management Reality
As an asset manager responsible for an A+ 57-story office tower, a 400-key hotel, and an underground parking garage—the largest asset my previous company owned—several lessons have stayed with me.
My background has always been rooted in operations: hotels and resorts, multifamily, and affordable housing. Across every asset class, the tension is often the same:
How do we make the pro forma work while still delivering the level of service guests, residents, owners, and investors expect?
That tension shows up in very practical places:
- Staffing.
- Sales and marketing budgets.
- Preventive maintenance.
- Resident and guest experience.
- Day-to-day operating realities.
- Capital constraints.
- Revenue assumptions that may or may not align with the market.
One thing I have come to strongly believe is this:
Whenever possible, property management should have a seat at the table before the final underwriting is locked.
That does not always happen. Timing, confidentiality, deal flow, and competitive acquisition processes can make it difficult. But when it is possible, I believe it creates better alignment among ownership, asset management, and the operating team.
What Happens When the Property Manager Doesn't Believe the Pro Forma?
But here is the harder question:
What happens when the property manager doesn't believe the pro forma?
Maybe the acquisition has already closed. Maybe the property manager was brought in after underwriting. Maybe the projected rent growth, expense load, staffing model, or lease-up timeline doesn't feel realistic to them. Maybe they're not wrong.
As asset managers, we still have obligations to ownership and investors. But we also need the operating team to trust the plan, understand the strategy, and believe they can execute it.
That requires more than pushing numbers down to the site level.
- It requires listening.
- It requires pressure-testing assumptions.
- It requires creativity.
- It requires operational humility.
- It requires finding the balance between accountability and partnership.
I would love to hear from others in asset management, property management, hospitality, multifamily, and commercial real estate:
How do you gain buy-in from an operating team when they don't fully agree with the underwriting?
What has worked when a property manager pushes back on the pro forma?
How do you uphold your obligations to investors while still giving the operating team the flexibility to solve problems in practical ways?
And for asset managers who didn't come from an operations background:
How did you build the operational knowledge needed to lead effectively?
I believe the best asset management happens when the spreadsheet and the site team are not working against each other but are instead operating in honest alignment.
