Basic Value-add Multifamily Quick Calc Model

Share on facebook
Share on twitter
Share on linkedin
Share on email

Top real estate acquisition teams review hundreds, if not thousands, of deals per year. A deep-dive analysis on every deal isn’t possible. Instead, deal teams run a “back of the envelope” or “quick calc” analysis to quickly determine if a deal meets basic investment criteria.

You can download my value-add and stabilized multifamily quick calc model below. However, I encourage you to use it as a framework to create your own model. These models inform big investment decisions, and you want to be confident that you understand all the “ins and outs” of your model.

Download the Model

Complete the form, and we'll email you an unlocked copy of the multifamily model.

Create an editable version of the model by selecting File >> Make a Copy.

This model is in Google Sheets, which I believe has a lot of benefits over excel. In fact, I wrote a whole post about the pros and cons of building real estate models in Google Sheets.

My focus in this model is three fold:

  1. Simplicity
  2. Format
  3. Accuracy
Keep your “quick calc” simple

My multifamily quick calc model is intentionally one page.

I kept the inputs and outputs simple and didn’t force extra outputs like dollar per unit and percent of total calculations.

The format is organized into two columns that read right to left. The most basic inputs start in the upper left, while the cash flows are in the bottom right of the page.

You’ll notice the absence of waterfalls and other GP related calculations. In a quick calc, it is most simple to evaluate a property absent of the general partner fee structure.

Given your fund’s common fees, you’ll be able to back into a quick calc return profile that works for your investors.

Additionally, you won’t find complex debt scenarios in the model. If you want to model a project with bridge debt or a refinance, you’ll need to use a different model.

Make sure your models are presentation ready

I recently had a Bullpen customer ask if we can help him find a new analyst on the platform. His current analyst did a great job running numbers but struggled to provide a presentation-ready work product.

In short, format matters.

When you present your model internally to an investment committee or external investor, the first impression of your work will be the colors and organization of the model.

I prioritize format in my multifamily quick-calc with the follow features:

  1. All inputs are blue, outputs are black
  2. The model is one tab and is print-ready
  3. Operating expenses are consolidated to one line-item
  4. No waterfalls – they are better suited for a deeper analysis
  5. Calculates key metrics: IRR, Avgerage Yield, Equity Multiple, and Debt Service Coverage
Your results need to be accurate

A quick-calc is only useful its results mimic a full underwriting analysis.

Test a sample deal in this quick-calc model against your full underwriting model before adopting it. Expand the columns to view the details of the model’s calculations.

Version control can be a big headache when working in excel. I prefer google sheets because of its built in version control management features.

To view prior versions of this model, go to File >> Version History >> See Version History.

You can even compare the changes between the current version and your version history, reverting to a prior version of the model if you find an error.

Send me feedback

Email me at [email protected] if you find an error or want to suggest edits to this model.

Additionally, let me know if you want to see more models like this. We’re always looking for new content ideas.

Become a subscriber! I’ll send out notifications when I make updates to this model.

ABOUT THE AUTHOR
Tyler is the Founder & CEO of Bullpen. Before becoming obsessed with proptech, Tyler built a commercial real estate consulting practice that advised some of the largest institutional investment firms on their most important projects. Tyler uses the Bullpen blog to share ideas and resources with readers who will shape the future of commercial real estate.

More from Bullpen

Subscribe to Bullpen

Analyst Resources. Financial Models. Growth Strategies

Join Bullpen today!

Bullpen is the only freelancer marketplace dedicated to the commercial real estate industry.