Real Estate Capital Account Tracking Tool (Updated Apr 2024)
I’ll be the first to admit that real estate asset management doesn’t get the attention it deserves on AdventuresinCRE.com. The real reason for this is that we’re not necessarily asset management experts. I spent some time working in asset management as an intern and I took my fair share of asset management courses during my graduate real estate studies, but I’m not in the asset management trenches every day and so I don’t often think about developing tools for our readers who are asset managers. But I’d like to change that. Allow me to introduce our first asset management Excel model – a tool for tracking the capital account balance of partners in a real estate venture.
- Fun fact: this tool was initially released in 2014, one of the first Excel models shared to A.CRE!
What the Real Estate Capital Account Tracking Tool Does
So, this Excel model is quite simple. Drop in various assumptions about the partnership structure, enter the capital contributions and distributions made to date, and the model outputs each partner’s capital account balance as of a specified date (defaulted to today).
The model can also report the capital account balance for any partner as of any date, so long as the actual data has been properly recorded in the model.
General Assumptions about the Partnership Structure
The model makes a few general assumptions about the partnership that are important to note. First, it is assumed that the preferred return and repayment of the capital account will be made pro rata based on the proportion of total equity each partner contributes with the balance compounding monthly.
Second, the model assumes a partnership structure where a preferred return is paid to the partners during operations, with any surplus in cash flow above the preferred return going to pay down the partners’ capital accounts and any deficit accruing to the capital accounts. At sale (or at a capital event), any accrued preferred return is first paid, followed by a reduction in the capital account to zero and then distribution to the partners based on some promote structure – the promote is not modeled in this tool but you can check out our Equity Waterfall models for how to calculate the promote.
Finally, the model assumes there are up to four partners, making no distinction between general and limited partners. However the logic in the model is such that adding more partners, or making distinctions between partners, shouldn’t be too difficult.
Video Tutorial for the Real Estate Capital Account Tracking Tool
I recorded a quick video tutorial showing you how to use the model, what the different inputs do, and which outputs are most important. Below the video you’ll find a link to download the model. Please let me know if you have any questions or comments.
- Track up to four partners capital accounts
- Outputs real-time balance for each partner
- Simple, one-tab module
- Include in larger asset management model or use standalone
Compatibility
This version of the model is only compatible with Excel 2013, Excel 2016, and Excel 365
Download the Real Estate Capital Account Tracking Tool
To make this tool accessible to everyone, it is offered on a “Pay What You’re Able” basis with no minimum (enter $0 if you’d like) or maximum (your support helps keep the content coming – typical real estate development tools sell for $25 – $100+ per license). Just enter a price together with an email address to send the download link to, and then click ‘Continue’. If you have any questions about our “Pay What You’re Able” program or why we offer our models on this basis, please reach out to either Mike or Spencer.
We regularly update the tool (see version notes). Paid contributors to the tool receive a new download link via email each time the tool is updated.
Version Notes
v2.0
- Fixed IRR calculation
- Updated Accrued Interest calculation to compound monthly on an Actual/Actual schedule
- Relabeled ‘Accrued Interest’ to ‘Preferred Return Owed’
- Extended Analysis Period to 10 years
- Added blue background to contribution and distribution input cells
- Updated placeholder values to better represent what an active file might look like
- Misc. formatting updates
v1.0
- Initial release
