https://innago.com/pro-forma-template/
A pro forma also plays a crucial role in risk management. By outlining key assumptions, such as occupancy rates, rent increases, and market trends, it helps investors and lenders evaluate potential risks. If the projections appear overly optimistic or based on uncertain assumptions, it may raise red flags. For instance, underestimating vacancy rates or inflating rental income could lead to unexpected shortfalls, increasing the risk of financial loss.
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