Single Family Development Model Pro-Forma Template (Excel XLSM)

This is a fully functional, institutional quality, and dynamic real estate financial model for calculating the return of the development and sale of a single detached housing unit. It is a robust model (with only four tabs), yet, very user-friendly that will provide the user with a detailed Excel spreadsheet. It's purposely simple, clean, and made to be filled out in no more than half an hour.

Return metrics include the levered internal rate of return, equity multiple, NPV.

The model is monthly in nature, and it is a 100% unlocked Excel file with fully transparent formulas that can be further tailored to suit the particulars of your transactions.

Model Structure:

1. Summary – Except for the budgets (hard and soft costs), all investment-related inputs are entered into this sheet. These include property description, investment timing, acquisition and investment costs, sale assumptions, operating expense assumptions, financing assumptions, the timing of the project, etc…

2. Hard Costs Budget – In this tab, the user can input all costs related to the building's structure, such as building walls, electrical, and plumbing. This sheet also covers the labor that goes into the construction. The hard costs are automatically distributed based on a bell-shaped curve.

3. Soft Cost Budget – In this sheet, the user can input additional costs not directly related to the construction budget, such as architectural fees or permit fees. The soft costs are distributed during the different phases of the project. (Pre, During, and Post Construction).

4. Cash Flow Tab – The calculations are performed on the Cash Flow worksheet. Assumptions entered on the Assumptions and Construction Budget sheets flow to the Monthly Cash Flow sheet, where a monthly forecast of all cash flows is calculated.


Instructions

• The user only needs to input information into the cells formatted in the dark blue font in the Investment Summary and Budgets sheets. If the contents of a cell are colored black, it means that it is a formula;

• The template is provided with information from a hypothetical property, for demonstration purposes, that must be erased;

• The model is expandable for up to 10 years.

The model includes an Equity Waterfall tab, allowing users to analyze preferred returns and multiple hurdle rates. Scenario analysis is also built-in, providing base, downside, extreme downside, and upside projections to stress-test your investment assumptions.