Spencer and I are excited to introduce the A.CRE Undergraduate Real Estate Series. Much like our series on top MBA in Real Estate and Masters in Real Estate programs, this series on Real Estate Undergraduate programs will provide our readers with a glimpse into not only what these programs have to offer, but insights from current or […]
While building out my hotel development model (currently underway), I decided to take a break and record a video about how I roll up the monthly cash flow line items on my Monthly Cash Flow sheet into annual cash flow line items on a separate sheet using only a single formula and simply copying and […]
The initial goal for the original Hotel Acquisition Model was to design a hotel proforma that would enable users to get deep into the weeds of practically every line item in their hotel analysis. Although I am super happy with how that hotel proforma has turned out, there are many instances where that model may […]
(Updated August 7, 2019 to include a Watch Me Build video and Downloadable file) Commercial real estate lenders commonly calculate loans in three ways: 30/360, Actual/365 (aka 365/365), and Actual/360 (aka 365/360). Real estate professionals should be aware of these methods if they want to understand the real interest rate as well as the total amount of interest […]
Welcome to the A.CRE Hotel Valuation Model‘s Tutorial Page. On this page you will find all the tutorials for the A.CRE Hotel Valuation model in Excel. There is a lot to learn within this model and over time, I’d like to show you both how to use it as well as how I built it. […]
This is a 3-tiered debt module that will allow the user to add one to three tiers of debt to his or her real estate DCF model. Includes the option to layer in senior debt, secondary debt, and mezzanine debt; calculate interest on either a 30/360, actual/360, or actual/365 basis; and model additional proceeds (i.e. […]
The Letter of Intent – Legal Issues The letter of intent is a critical document that is written up at the beginning of a potential real estate transaction between either a prospective buyer and seller or a prospective tenant and landlord. The LOI contains preliminary understandings between both parties about major points of interest and concerns […]
Hotels are a unique asset in the commercial real estate world and are underwritten differently as a result. Probably the most obvious difference is the duration of the ‘lease term’ of the tenant, which is usually daily to weekly. Another major difference is that hotels are more operating intensive and typically contain other complimentary services […]
I’ve built a new acquisition model that I am excited to share with our readers. This is a back-of-the-envelope (BOE) valuation model that can be used for retail, office, and industrial properties. The goal was to create a sleek and clean look to the model that would enable a third party to easily understand what […]
In this post, we are going to take a deeper look into capital expenditures. What it is and how we account for it in cre underwriting. Capital expenditures, commonly referred to as Cap Ex, are expenses that occur outside of normal operating expenses. They are items that ownership either needs to or decides to pay […]
Part 2: The XIRR (Click here for Part 1 where we cover the IRR) This is Part 2 of our A.CRE Deep Dive – 2-part mini-series on the IRR and XIRR return metrics and functions in Excel. As stated in Part 1, these are some of the most commonly used functions and return metrics in […]
For my next post, I thought I would bring it back to some fundamentals and review the IRR and XIRR return metrics and functions in Excel. These are some of the most commonly used functions and return metrics in commercial real estate and they can be a bit complex to understand for those of us […]
At the bottom of this post is a downloadable practice tool for the A.CRE Method for doing cap rate mental math. The tool will generate an endless number of random cap rates and NOIs to practice with and will walk you step by step through how to solve for each scenario you are working in. […]
After receiving a few requests, I’ve finally gotten around to adding an equity waterfall module to the Condominium Development Model. This module allows you to model partnership splits up to three tiers using either equity multiple hurdles or IRR hurdles. Additionally, you can model for a preferred return for the limited partner where either (1) […]