CASE STUDY – BBLP JOB INTERVIEW PREP ASSIGNMENT

[Anonymous]

The Original Retail statement and the BBLP spreadsheet summary seem to have very different methodologies. They have duplicate categories, and in this case, I’m sure how they should be rectified. The majority of the categories in the subject detailed statement is not reimbursable. Even when there’s income that is given like in the case of Real Estate Income.

[Spencer Burton]

Appreciate the comment Peter, but I’m not understanding the question. If you wouldn’t mind clarifying that would be helpful!

When you refer to the ‘original retail statement’, are you referring to the ‘Summary Income Statement Templates’ file found in the ‘Case Study Downloads’ section of lecture 1.6? Or in other words, the summary statement that we use to rollup the detailed statement?

Likewise you mention that “the majority of the categories in the subject detailed statement are not reimbursable”, however all of the operating expense line items in the ‘Detailed Income Statement – Retail‘ file used in the case assignment are reimbursable (the file is found in the ‘Case Study Downloads’ section of lecture 1.6).

You might also take a look at ‘Watch Me Build’ video at the end of the course to get a better understanding of how I go about rolling up the detailed line items to summary line items.

But again, if you wouldn’t mind clarifying the question that will help me better answer the question.

Thanks!

Spencer

[Anonymous]

Thanks so much for the response. I was referring to the 1.6 Detailed when was said the ‘original retail statement’. Sorry, late night.

I didn’t want to watch the video until after I tried and went through the quiz. Originally, I didn’t think they were all reimbursable. I suppose that there’s a fair amount of judgement call when doing this for real in situations where one organization has wildly different categories or approaches.

[Spencer Burton]

Absolutely. One of the reasons for this exercise, beyond getting familiarized with retail income statements, is to expose you to how different one property’s income statement can be from the next. And since generally you’re working with a standardized summary income statement in your firm’s model, you’re often making judgement calls about how roll up a property’s line items into your own.

So while the task may same tedious and somewhat arbitrary, depending on the role you have in real estate this very likely is a task that you’ll perform everyday.

But even if you’re never required to perform this specific task, the concept of using SUMIF() in Excel to rollup values is essential to real estate financial modeling. At some point in your career, you will use it to roll up monthly cash flows to annual, roll up detailed construction budget line items to summary line items, roll up detailed rent roll line items to summary, etc.

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