The SUMPRODUCT function is extremely useful in calculations with large amounts of data in tables to calculate weighted averages, check errors, compute complicated data, or information that will be referenced in financial models. It can be used in combination with almost any formula and can thus be useful in saving time.
Read MoreProject management fees are an elected fee that can be paid towards a number of people including the developer or the capital/equity provider. This fee is not included in the net operating income (NOI) line of a model and should be included below the line
Read MoreThe going-in cap rate is important because it provides insight into how risky an investment is compared to other opportunities. It is important to note the different formulas for developments and acquisitions and be mindful of using the proper formula for a project. Going-in cap rates are also important to determine if there is cap rate compression but be cautious to not just rely on the going-in cap rate to analyze a potential investment.
Read MoreCAM stands for common area maintenance. CAM charges are pro-rata charges, paid by tenants, included in leases to compensate/reimburse landlords for costs incurred to operate, maintain, and repair the property.
Read MoreThe Offset Function is a function in Excel that returns a cell or range of cells that is a specified number of rows and columns from a cell or range of cells. It can be a very useful and dynamic tool especially when combined with other formulas and when one of the arguments can vary.
Read MoreThe debt service coverage ratio represents the capacity to repay a loan. It measures the cashflows compared to the interest and principal repayment. The DSCR formula is an important calculation used by both the borrower and lender to determine if the borrower should apply for a loan and even more, be approved.
Read MoreAs a real estate investor, it is important to know the general vacancy of a rental property. Whether the property is multifamily, a hotel, an office building, etc., every property has a vacancy rate. The general vacancy is an essential metric when determining if a property is performing to its capacity or falling short.
Read MoreA sensitivity analysis is a key tool in decision-making and can provide more than one solution to a problem. By creating a data table, analysts can predict the outcomes of a specific situation under a set of conditions. Sensitivity analysis is an important technique that can help you compare multiple scenarios at a time to help in the decision-making process.
Read MoreBoth XIRR and IRR are Excel functions used to find the IRR of a project. But what is the difference between them?
Read More
