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Real Estate Development in Excel (Includes Template)
Rating: 4.2 out of 5(91 ratings)
630 students

Real Estate Development in Excel (Includes Template)

Learn Industry Standard Analysis and Valuation Techniques For Real Estate Development
Created byDaniel Davis
Last updated 2/2018
English
English [Auto],

What you'll learn

  • This course comes with a fully built, plug and play model which you can download and use to analyze any real estate project
  • You will learn how to value a multi-family real estate project using industry standard techniques
  • You will be able to impress current and future employers with your understanding of real estate finance

Course content

1 section • 11 lectures • 1h 1m total length

  • Introduction to Real Estate Development In Excel1:52

    Build a plug-and-play financial model for a multifamily real estate development, forecast cash flows, and compute project valuation and equity investor returns using the wide cap rate method.

  • High Level Overview of the Model11:17

    Explore the high level overview of the real estate development model in Excel, detailing loan, equity, unit mix, costs, stabilization, and cash flow calculations that drive IRR and project valuation.

  • High Level Overview Part 27:26

    Explore the investor return tab to see how cash flows, arrears, and distributions determine preferred investor returns, with notes on construction and permanent loan financing.

  • Focus on The Financing Assumptions and Valuation Metrics4:37

    Focus on financing assumptions for construction and permanent loans, draw periods, and draw ratios. Explain interest accrual on drawn amounts, the five-year window, 25-year amortization, and balloon payment at refinance.

  • Financial Assumptions Explained Part Two8:00

    Explain how equity investors' preferred returns and KPI metrics drive annual cash flows, cap rate valuation, debt service coverage, and IRR calculations in the Excel model.

  • Project Assumptions Sheet7:06

    Input the unit mix and project costs on the project assumptions sheet to see how they affect cash flow and the timeline. Adjust vacancy and stabilization to dynamically recalculate IRR.

  • Projected Cash Flows Page6:55

    Explore projecting cash flows in real estate development using an excel template: calculate gross rent, vacancies, operating expenses, net operating income, debt service, distributions, and equity IRR.

  • Stabilization Period Income2:20

    Analyze the stabilization period from certificate of occupancy to full occupancy, modeling incremental occupancy over months and forecasting rents and utilities cash flows and expenses.

  • Investor Distributions3:33

    Calculate investor arrears from the construction phase and apply the preferred return, then allocate investor distributions from operations to investors according to the payout ratio and their claim.

  • Amortization Tables and Report Templates3:25

    Explore construction and permanent loan amortization templates with assumptions from the financial tab, and learn to override projected cash flows while separating interest and principal in the reports.

  • How to Add Years to the Model5:03

    Add years to the cash flow model by updating the investors returns tab, applying growth, and recalculating valuation, IRR, and KPI figures using the cap rate.

Requirements

  • A familiarity with Microsoft Excel will help you in this course, though it is not necessary.
  • Any background in real estate will be helpful, though again, it is not necessary.

Description

This course will teach you how to financially model a multi-family real estate development project and comes with a downloadable, complete Excel model.  The model that comes with this course is plug and play with minimal work necessary to adapt it to any kind of multi-family development project.  

This course will teach you how to use the model, the industry standard terms, metrics and valuation techniques which developers use on a daily basis.  

Here are some strengths of the model: 

  1. The model dynamically calculates various metrics, including IRR, Debt Service Coverage, Yield to Cost, Loan to Cost and Project Valuation so you can see how every variable you change affects the project. 
  2. This model is used in industry for actual real estate projects
  3. Designed to model equity investors for syndicated projects.  The model will show equity IRRs and investor returns.
  4. Designed to model a construction loan, a take-out permanent loan, a balloon payment and all of the debt service payments along the way. 
  5. The model comes with integrated amortization tables for quick analysis of loans.  

The model is specifically designed to be easy to adapt to any kind of multi-family project. The video content of the course will show you everything you need to know to re-tool the model to handle any variety of unit mix, stabilization period, rent, loan, and exit date.  

This course will demonstrate how to financially model the development of a 36 unit apartment complex, from equity contribution up through the sale of the project.  

Welcome to Real Estate Development in Excel. 




Who this course is for:

  • Anyone looking to learn the finances behind real estate development.
  • Anyone looking for a functional financial model they can use to impress future employers, or use for a RE development project
  • Anyone trying to learn the financial terms and techniques of real estate development
  • Anyone looking to grow their Excel skills

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