Disposition Prep Kit

Clarifying Questions

Before producing the package, ask any of these that remain unanswered:

1. Selling as-is or offering credits for known issues?
2. Timeline constraints (1031 identification/closing deadlines, loan maturity)?
3. Biggest risk a buyer will identify and attack during diligence?
4. Financial quality: clean (GAAP-ish, management-company-prepared) or messy (owner-operated, commingled)?
5. Target buyer pool: value-add operator, core buyer, 1031 exchange, developer/redeveloper?

Input Schema

Process

Step 0: Load Brand Guidelines (Auto)

Before generating any deliverable:

1. Check if ~/.cre-skills/brand-guidelines.json exists
2. If YES: load and apply throughout (colors, fonts, disclaimers, contact info, number formatting)
3. If NO: ask the user:

   "I don't have your brand guidelines saved yet. Would you like to set them up now with /cre-skills:brand-config? Or I can proceed with professional defaults."

   • If user says set up: direct them to /cre-skills:brand-config, then resume
   • If user says proceed: use professional defaults (navy #1B365D, white #FFFFFF, gold accent #C9A84C, Helvetica Neue/Arial, standard disclaimer)
4. Apply loaded or default guidelines to all output sections:
   • Color references in any formatting instructions
   • Company name in headers/footers
   • Disclaimer text at the bottom of every page/section
   • Confidentiality notice on cover
   • Contact block on final page/section
   • Number formatting preferences throughout

Step 1: Red Flag Scan

Before building the package, check for blockers:

1. Implied cap rate vs. market: current_noi / expected_price. If the implied cap rate is 150+ bps below market for the asset type and geography, flag that the price expectation may be unrealistic and will extend marketing time or invite retrades.
2. Occupancy risk: If current_occupancy_pct < 0.85, flag that low occupancy will depress buyer underwriting and may require a lease-up concession or price adjustment.
3. Timeline vs. preparation scope: If financials_quality == "messy" and target_sale_window < 60 days, flag that normalization and data room assembly may not be completable in time.
4. Known issues severity: Scan known_issues for environmental contamination, structural deficiency, or active litigation. These require specialized disclosure strategy and may narrow the buyer pool materially.

Surface all flags before proceeding. Do not suppress warnings to be accommodating.

Step 2: T-12 Normalization (Section F)

Produce a line-by-line normalization table:

Revenue normalization rules:

• Remove one-time income items (insurance proceeds, utility rebates, asset sale gains)
• Annualize partial-period tenants (prorate to full year)
• Mark-to-market below-market leases with a footnote showing upside
• Adjust for concession burn-off (show gross and net)
• Flag any tenant concentration (single tenant > 10% of revenue)

Expense normalization rules:

• Remove owner-specific items (personal car, family payroll, non-arms-length vendor contracts)
• Adjust management fee to market rate: 3-5% EGI for multifamily, 4-6% for commercial
• Normalize insurance and property taxes to expected buyer's basis (new assessment on sale)
• Adjust for deferred maintenance catch-up (is the recent capex spike one-time or recurring?)
• Separate capital expenditures from operating expenses

Principle: defensible, not aggressive. Removing genuine one-time items and owner perks is standard. Anything beyond that risks credibility with buyer's underwriter.

Step 3: Rent Roll Scrub (Section G)

Produce a per-unit or per-suite table:

Status flags:

• MTM -- month-to-month; note conversion probability
• EXPIRING -- lease expires within 6 months of expected close
• BELOW -- current rent > 5% below market (buyer upside)
• ABOVE -- current rent > 5% above market (rolldown risk)
• CONCENTRATION -- tenant represents > 10% of total rent

Summarize: total in-place rent, total market rent, mark-to-market variance, weighted average lease term, MTM count, expiration schedule by quarter.

Step 4: Data Room Index (Section B)

Produce a hierarchical folder structure:

Seven top-level folders: /01-Financial/ (T-12, rent roll, historicals, bank statements, AP/AR, budget variance), /02-Lease-Files/ (executed leases, amendments, estoppels, tenant correspondence), /03-Property-Info/ (survey, floor plans, photos, inspections, Phase I/II, capex history, insurance loss runs), /04-Legal/ (title, zoning, COs, violations, service contracts, PM agreement), /05-Tax/ (tax bills 3yr, appeal history), /06-Market-Data/ (submarket overview, sales comps, rental comps, demographics), /07-Investment-Summary/ (executive summary, positioning statement, value-add narrative, upside proforma).

Note access controls (e.g., Phase I available after LOI execution only) and document completion status for each item.

Step 5: Buyer Q&A Cheat Sheet (Section C)

Produce a table of 20+ anticipated buyer questions with prepared answers:

Cover these categories:

• Financials (T-12 adjustments, expense trends, tax reassessment risk)
• Physical condition (deferred maintenance, remaining useful life of major systems)
• Tenancy (rollover risk, tenant credit, concession history)
• Market (rent growth justification, supply pipeline, comparable sales)
• Legal/environmental (violations, Phase I findings, insurance claims)
• Value-add (renovation ROI evidence, remaining upside quantification)

Answers should be factual, concise, and reference a specific document in the data room. Never say "we'll get back to you" -- either have the answer or flag the gap for the seller to fill pre-launch.

Step 6: Positioning Statement (Section D)

Write a 150-200 word investment highlights narrative suitable for an offering memorandum executive summary. Requirements:

• Factual and quantified (not "great location" but "0.3 miles from [transit], 15-minute drive time to 500K+ employment base")
• Lead with the strongest value proposition
• Specific: reference unit count, occupancy, NOI, recent renovations with ROI data
• Forward-looking: articulate the buyer's upside story with numbers

Step 7: Retrade Defense Plan (Section E)

Identify the top retrade vectors for this specific deal and pre-document defenses:

Common vectors by asset type:

• All: deferred maintenance discoveries, environmental findings, insurance cost increases, tax reassessment risk, rent roll deterioration between LOI and close
• Multifamily: unit condition variance, utility cost allocation, pest/mold history, below-code items
• Commercial: tenant credit deterioration, co-tenancy clause triggers, CAM reconciliation disputes, roof/HVAC remaining life

For each vector: (1) what evidence to pre-assemble, (2) what to disclose proactively vs. let diligence surface, (3) scripted response if the buyer raises it as a price reduction request.

Step 8: Pre-Sale Punch List (Section N)

Prioritized list of improvements before marketing:

Hard rule: flag any item where cost exceeds value impact. Over-improving with low-ROI work is a common seller mistake. Focus on items that (a) remove buyer objections or (b) improve first-impression curb appeal at high ROI.

Step 9: Timing Recommendation (Section J)

Structured sell-now vs. wait analysis:

Produce a clear recommendation with reasoning. If the answer is "wait," specify what trigger would change it to "sell."

Step 10: Value Story (Section K)

3-5 bullet narrative the broker can use in marketing. Each bullet must be specific and quantified:

• BAD: "Strong rent growth potential"
• GOOD: "60 of 100 units renovated at $15K/unit achieving $200/unit monthly premium; 40 remaining units represent $96K incremental annual NOI at stabilization"

Step 11: Buyer Targeting (Section L)

Minimum 4 buyer types. Common archetypes: value-add operator, core/stabilized buyer, 1031 exchange buyer, developer/redeveloper, institutional fund, local operator, family office.

Step 12: Risk Disclosure Strategy (Section M)

Principle: controlling the narrative is always better than letting buyers "discover" issues. Proactive disclosure with documentation reduces retrade leverage.

Step 13: Broker Selection (Section H)

Evaluation matrix:

10 interview questions for broker presentations. Commission negotiation guidelines by deal size ($1-5M, $5-15M, $15M+). Exclusive vs. open listing analysis.

Step 14: Marketing Timeline (Section I)

5-phase, 22-week Gantt-style execution plan:

Adjust phase durations by asset type: office and industrial typically require longer diligence (Phase 5) for credit tenant analysis, environmental Phase I/II, and lease review. Note this explicitly.

Step 15: 30/60-Day Prep Checklist (Section A)

Sequenced checklist:

Minimum 20 line items covering financial prep, physical prep, legal prep, and marketing prep.

Output Format

Present results in this order:

1. Red Flag Scan -- pass/fail for each check, with blockers surfaced before any other output
2. Section A: 30/60-Day Prep Checklist -- sequenced task list
3. Section B: Data Room Index -- folder tree with completion status
4. Section C: Buyer Q&A Cheat Sheet -- 20+ questions with answers
5. Section D: Positioning Statement -- 150-200 word narrative
6. Section E: Retrade Defense Plan -- vectors, evidence, responses
7. Section F: T-12 Normalization -- line-by-line table (if T-12 provided)
8. Section G: Rent Roll Scrub -- per-unit table (if rent roll provided)
9. Section H: Broker Selection -- matrix, questions, commission guidelines
10. Section I: Marketing Timeline -- 5-phase Gantt
11. Section J: Timing Recommendation -- sell now vs. wait analysis
12. Section K: Value Story -- 3-5 quantified bullets
13. Section L: Buyer Targeting -- 4+ buyer types with pitch angles
14. Section M: Risk Disclosure Strategy -- issue-by-issue approach
15. Section N: Pre-Sale Punch List -- prioritized improvements with ROI

Red Flags: Stop Conditions

1. Implied cap rate > 200 bps below market comps: the expected price is likely unrealistic. The property will sit on the market, signal distress, and ultimately sell below where it would have with realistic pricing. Surface immediately.
2. No T-12 and no rent roll: there is no financial package to sell. The property cannot be marketed credibly without at least normalized trailing financials and a current rent roll. Advise a 30-60 day delay to assemble these.
3. Active litigation affecting title or occupancy: this must be disclosed and may require legal resolution before marketing. Flag for attorney review.
4. Environmental contamination (known, unremediated): narrows the buyer pool to specialists and materially impacts pricing. Advise Phase II completion before marketing if not already done.
5. 1031 deadline < 45 days away with no broker engaged: the timeline is likely unworkable for a marketed sale. Consider direct/off-market sale or 1031 intermediary consultation.

Chain Notes

• Upstream: market-memo-generator (submarket context for positioning), quarterly-investor-update (historical performance data for T-12)
• Downstream: 1031-exchange-navigator (if seller needs 1031, timeline feeds deadline management), capital-raise-machine (sale proceeds funding next raise; data room conventions shared)
• Lateral: deal-underwriting-assistant (buyer's perspective on the same deal -- use to stress-test pricing), comp-snapshot (comparable sales for positioning and pricing validation)