In commercial real estate, due diligence is a crucial step in acquiring property, yet the methods used can vary significantly from one firm to another. At FNRP, we’ve created a distinctive due diligence approach through our team, the “FNRP Strikeforce.” This team brings together experts from all areas of the company to perform a comprehensive review of every property before acquisition, ensuring that we align with our investment criteria and business goals. This approach ensures that risks are minimized, and the potential for return is maximized.

The FNRP Strikeforce Mission

At the heart of the FNRP Strikeforce is a simple, yet effective mission: to verify the assumptions made during the initial underwriting and reaffirm the business plan for each asset. This critical mission helps our management team evaluate the risk/reward profile of each acquisition and ensure that the projections align with reality. The Strikeforce focuses on four essential aspects to achieve this goal.

Physical Property Inspections

A property visit is a key component of our due diligence process. It provides us with direct insight into the asset’s condition, challenges, and potential opportunities that may not be evident through earlier analyses. By inspecting the site firsthand, the Strikeforce can better assess the property’s overall value and make informed decisions that were not apparent from the initial review.

Tenant Engagement

An essential aspect of the Strikeforce approach is engaging with current tenants before finalizing an acquisition. These conversations are vital for validating leasing assumptions, understanding tenant satisfaction, and uncovering potential issues that may affect the property’s operation. Engaging with tenants allows us to identify operational challenges and mitigate risks associated with tenant retention, ensuring a smooth transition after the acquisition.

Local Market Insights

Before deploying the Strikeforce, FNRP analysts conduct comprehensive research on both the property and its local market. This quantitative research serves as the foundation for the investment decision. However, the real value comes when our team physically tours the local area to gather qualitative information about the market dynamics. During the site visit, we assess factors such as traffic patterns, parking availability, and proximity to key amenities.

The Strikeforce team also engages with local brokers, tenants, and competitors to gain a deeper understanding of the market landscape. This allows us to assess whether the property is well-positioned to meet the needs of the local tenant base and determine whether the business plan is feasible.

Refining the Business Plan

Once a property meets our investment criteria, FNRP’s leadership team drafts a business plan, which serves as a roadmap for the property’s evolution during the holding period. After the Strikeforce has completed its site visit and gathered all relevant information, the team conducts a debriefing session to finalize the business plan. This updated plan incorporates input from all functional areas, offering a clear and unified strategy for the property’s management and maximizing returns for our investors.

FNRP360: Enabling the Strikeforce

FNRP’s unique operating platform, FNRP360, is built on the principles of vertical integration. By bringing all key operations—asset management, accounting, legal, and leasing—in-house, we create a streamlined, efficient system for rapid decision-making. This integration is crucial for the success of the Strikeforce, as it allows for seamless communication among all experts involved in the acquisition process.

Unlike many firms that outsource critical functions, FNRP relies on its in-house team to collaborate on acquisitions, ensuring that every aspect of the due diligence process is meticulously reviewed by specialists from every area of expertise.

Enhancing Accountability and Collaboration

The Strikeforce model ensures that accountability is embedded into the due diligence process. Rather than relying on a single acquisitions representative to evaluate the property, FNRP involves team members from asset management, property management, and construction management. This collaborative approach ensures that all potential risks and opportunities are thoroughly considered by those who will be managing the asset post-acquisition.

After each site visit, the Strikeforce team meets to share their observations and discuss how to refine the underwriting models. This collaborative effort allows for quick adjustments to the business plan and ensures that the assumptions and projections are as accurate as possible.

Smooth Transition from Acquisition to Ownership

One of the key benefits of the Strikeforce model is that it helps ease the transition from acquisition to ownership. By involving asset management leadership in the due diligence process, FNRP ensures that the team is prepared to take immediate action on the day of closing. This seamless transition improves operational efficiency and enables us to implement the business plan right from the start.

Mitigating Risk for Investors

The FNRP Strikeforce model offers significant advantages to our investors by ensuring that all risks are thoroughly assessed before an acquisition is finalized. The team’s comprehensive due diligence process allows us to detect and address potential issues early, giving investors confidence that their capital is being placed in carefully vetted assets. Moreover, by involving leaders from all functional areas of the firm in the process, we ensure that the business plan is well-rounded and aligned with the firm’s long-term goals.

Conclusion

The FNRP Strikeforce approach to due diligence sets us apart from other commercial real estate firms. By bringing together experts from every area of the firm, we ensure that every property is thoroughly evaluated and that all risks are accounted for before acquisition. This holistic approach results in more accurate projections, better asset management, and ultimately, stronger returns for our investors. Through the Strikeforce, FNRP continues to prioritize transparency, collaboration, and accountability, delivering the highest level of due diligence in every acquisition.