Thank you for this tutorial and summary - I know you were trying to cover most of the material within 20min but I was wondering if you had in-depth videos on each of the topics / investments you discussed?
In our full Real Estate course, yes. There are 44 hours of video tutorials on all these topics and more. This channel is just for samples and quick overviews.
This is a great video! I wanted to learn to build my own CRE excel financial modeling for my deals with the formulas most used, can you recommend a cheap or free excel program for this online?
We have many free real estate tutorials in this channel and on M&I. If you want a paid course, we offer a Real Estate Modeling course on BIWS, though it is not "cheap," as we aim to be comprehensive.
Thank you for this! Learned a lot. Just one question: In the simple acquisition model example, why are bad debt and concession combined into a single cell as a metric? From my understanding concessions is something you can control contrast to bad debt. Shouldn't they be apart? Thank you and excuse my ignorance haha!
You could separate them, but this is a simplified model, so we combined them and assumed that both bad debt and concessions tend to rise when the economy is bad. If they moved in different directions under different economic conditions, we might have separated them.
From the linked article: "Properties are much simpler than large companies, so if it’s feasible to simplify the financial statements like this for companies, it’s even more feasible to simplify them for properties. It’s also simpler because Working Capital tends to be less important for properties, and you effectively use Cash Accounting rather than Accrual Accounting in the analysis. Also, you usually ignore income taxes because properties tend to be owned by pass-through entities such as Partnerships, S Corporations, and REITs that do not pay corporate income taxes. Finally, “other activities” on companies’ Cash Flow Statements are often minimal for properties, and Debt and Equity Issuances and Debt Service can be handled directly on the pro-forma. To be clear: properties still have full financial statements. It’s just that for financial modeling, valuation, and investment analysis, you almost always skip the full statements and focus on the pro-forma instead."
Thank you for the great videos! I have an question for Levearged IRR & Unleveraged at the Excel file you've attached.(Real-estate-Pro-forma) I think terms of them should be switched. Is it right? I thought Cashflow to Equity Investors (Unlevered IRR)
Leveraged IRR means the annualized return that equity investors earn, after factoring in debt and debt service. Unleveraged means, "Let's ignore Debt and pretend the property was purchased with 100% equity, so there is no Debt to reduce the upfront purchase price and there's also no Debt service during the holding period."
This is truly a gem of a video. Thank you for sharing🙌🏼
Thanks for watching!
Wow.. Im gonna buy biws real estate course for sure.
Presentation + Teaching skill is top notch.
Thanks! Good luck and let us know if you have any questions.
This is a yummy presentation. It's helpful. It makes sense and if informative. The desert part is the free content.
Thanks!
Thank you so much for this overview! I am about to start a career in CRE and really enjoyed this insight!
Thanks for watching!
Thank you for this channel!!! Been prepping up for Investment bank interviews!
Thanks for watching!
This was perfect! Thank you!
Thanks for watching!
Thank you for this tutorial and summary - I know you were trying to cover most of the material within 20min but I was wondering if you had in-depth videos on each of the topics / investments you discussed?
In our full Real Estate course, yes. There are 44 hours of video tutorials on all these topics and more. This channel is just for samples and quick overviews.
This is a great video! I wanted to learn to build my own CRE excel financial modeling for my deals with the formulas most used, can you recommend a cheap or free excel program for this online?
We have many free real estate tutorials in this channel and on M&I. If you want a paid course, we offer a Real Estate Modeling course on BIWS, though it is not "cheap," as we aim to be comprehensive.
Thank you for this! Learned a lot. Just one question: In the simple acquisition model example, why are bad debt and concession combined into a single cell as a metric? From my understanding concessions is something you can control contrast to bad debt. Shouldn't they be apart? Thank you and excuse my ignorance haha!
You could separate them, but this is a simplified model, so we combined them and assumed that both bad debt and concessions tend to rise when the economy is bad. If they moved in different directions under different economic conditions, we might have separated them.
Does excel help with calculating cap rates noi etc, or do you need these percentages before hand?
You need an outside source for the data.
Awesome video! You give off cocaine-level energy
Thanks for watching!
why no 3 statement modeling for real estate?
You mean like financial statements?
From the linked article:
"Properties are much simpler than large companies, so if it’s feasible to simplify the financial statements like this for companies, it’s even more feasible to simplify them for properties.
It’s also simpler because Working Capital tends to be less important for properties, and you effectively use Cash Accounting rather than Accrual Accounting in the analysis.
Also, you usually ignore income taxes because properties tend to be owned by pass-through entities such as Partnerships, S Corporations, and REITs that do not pay corporate income taxes.
Finally, “other activities” on companies’ Cash Flow Statements are often minimal for properties, and Debt and Equity Issuances and Debt Service can be handled directly on the pro-forma.
To be clear: properties still have full financial statements.
It’s just that for financial modeling, valuation, and investment analysis, you almost always skip the full statements and focus on the pro-forma instead."
I couldn't find this excel sheets in the link in the description. Where is it?
www.mergersandinquisitions.com/real-estate-financial-modeling/ "Real Estate Financial Modeling: Sample Excel (XLS) Files"
@@financialmodelingThat is really helpful, however I can not access to the excel now. DOES THE LINK STILL WORK? THANKS
hi brian, where does PBSA fit in this?
Not sure what you are asking? Student housing is just a sub-asset class within real estate, similar to multifamily.
@@financialmodeling thanks for the clarification. That makes sense
Thank you for the great videos!
I have an question for Levearged IRR & Unleveraged at the Excel file you've attached.(Real-estate-Pro-forma)
I think terms of them should be switched. Is it right?
I thought Cashflow to Equity Investors (Unlevered IRR)
Leveraged IRR means the annualized return that equity investors earn, after factoring in debt and debt service. Unleveraged means, "Let's ignore Debt and pretend the property was purchased with 100% equity, so there is no Debt to reduce the upfront purchase price and there's also no Debt service during the holding period."
@@financialmodeling Really Thank you I should have checked the terms correctly..
Always Thanks for your videos.
Where is the excel model for this vid? thanks ..
www.mergersandinquisitions.com/real-estate-financial-modeling/