Beyond monitoring performance creating a watchlist september 24 2010
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Vermont Housing & Conservation Board. Beyond Monitoring Performance: Creating a “Watchlist” September 24, 2010. Due Diligence Checklist. The following are key actions in an Asset Management Plan for a property requiring Executive Team and Board monitoring.

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Beyond Monitoring Performance: Creating a “Watchlist” September 24, 2010

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Vermont Housing & Conservation Board

Beyond Monitoring Performance: Creating a “Watchlist”September 24, 2010

Due Diligence Checklist

The following are key actions in an Asset Management Plan for a property requiring Executive Team and Board monitoring.

  • Review of owner’s broad goals for the property, and the degree to which the property succeeds in meeting those goals

  • Review of conformance with initial multiyear proforma projection

  • Approval of annual operating budget and management plan

Due Diligence Checklist (cont)

  • Compliance with established property performance benchmarks

    • Financial

    • Physical/Sustainable

    • Social/Mission

  • Compliance with CDC obligations and warranties such as cash flow performance, reserve balances, tax credit compliance

Due Diligence Checklist (cont)

  • Approval of any deal revisions, major capital expenditures

  • Approval of any change in property management

  • Review and approval of any potential financial restructuring of the property

It is a list of properties that are under scrutiny based on their performance in one or more identifiable indicators

Different stakeholders are likely to focus on different indicators

Being on a watch list can trigger events or consequences that pose difficulties for a property or an organization

What is a Watch List?

Stakeholder Watchlists

What are likely to be on these stakeholders’ watchlists?

  • Lender

  • Investor

  • Regulator

  • Board of Directors

  • Property Manager

  • Residents

Make the criteria SMART






First, identify the key indicators for your portfolio

Secondly, establish the criteria you will use to evaluate each indicator

Lastly, decide on a ranking system

The Asset Manager’s Watch List

INDICATOR: May be one discrete indicator, such as vacancies,


a combination of one or more (rent loss which equals vacancies plus uncollected rent)


0 = > 7%

1 = 5% - 7%

2 = 3% - 4.99%

3 = 1% - 2.99%

4 = < 1%


0 Troubled, Watch List

1 Watch List

2 Watch List

3 Performing

4 Performing

Watch List Example

Your materials include

A sample of a non-profit asset manager’s “portfolio status report” of a portfolio that is a combination of owner/managed and third-party managed properties

A sample of an intermediary’s quarterly portfolio summary

Both “rank” or “rate” properties

Critique these report as follows:

Evaluate the indicators

What do you like

What’s missing

Evaluate the criteria

Are they SMART?

What would you change?

How much of the portfolio is ranked


Watch List


What indicators are weakest?

Evaluating a Watch List

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