Wall Street Prep Real Estate Financial Modeling Flashcards

Wall Street Prep Real Estate Financial Modeling Flashcards how many different places can you typically find contingency in a development budget three Which of the following is a supporting tab for a multifamily model Historical financials which of the following is not a requireed input for the PMT function Interest Only Peirod which of the following is not an additional funding mechanism Yield Maintenance which of the following does not describe a "core" investment 50% leased multi-tenant property which of the following is not a reason investors use leverage Reduce investment returns which of the following does not describe a "value-add" investment Development what is the difference between the market cap rate and yield-on-cost (YOC) development spread In a model, what font color should hard-coded numbers (inputs) be Blue which of the following is not a loan cash flow Beginning balance which of the following would not be considered Deferred Mantenance Gym renovation what is the main driver of property values tenants and their ability to pay rent What is ArgusA software program used to project cash flows for commercial property types which of the following in not included in development financing costs acquisition closing costs what does unlevered cash flow (UCF) measure net ash inflows and outflows before taking into account cash flows related to financing who is most involved in the day-to-day operations of a property General partner Total sources should always equal whattotal uses which of the following typically has the right to foreclose on the equity position and take control of the property Mezzanine Debt which of the following metrics is not used to determine the maximum loan amount cash-on-cash what is subtracted from Net Potential Rent (NPR) to calculate net effective rent (NER) Concessions which of the following is not a major cost category in a development budget vertical building costs in which scenario does a landlord pay tenant improvement costs directly to the tenant Tenant improvement allowance

What does net operating income (NOI) measure profitability of a property's operations what is a good rule of thumb for an acquisition fee as a percentage of the purchase price 1% what is the largest cost category in a development budgethard costs how is net operating income (NIO) calculated NIO = total income - total expenses what is the pro of non=recourse loanslimited personal liability what support tab is included in development modelsDevelopment budget Which of the following should you avoidnaming cells and ranges what is a fee paid to commercial real estate brokers for facilitating a lease transation Leasing Commission what is amortizationthe process of spreading out a loan into a series of fixed payments over time Which of the following would not be considered an Offensive Renovation parking garage repairs which of the following does not describe an "opportunistic" investment stable rent roll which formula is frequently used in real estate financial models when dealing with dates and timelines =EOMonth What is a real estate joint venturean agreement between two or more parties who have decided to pool resources to purchase a real estate asset what are capital reservesfunds set aside from operating cash flow for future capital improvements

what is another term for :sponsor"Limited Partner

Which lease structure results in the highest quoted rentFull Service (FS) what is the top revenue line of a multifamily developmentNet Potential Rent (NPR) Which of the following does not describe Tenant Improvements (TIs) The improvements a tenant leaves behind after vacating their space what marks the end of the stabilization period Burn-off of lease-up concessions non-recourse loans are collateralized by what the property which of the following is a synonym for "cap rate"Yield which of the following is not a common closing costasset management fees what excel function is used to calculate the amortization payment amount =PMT which of the following is included in hard costs costs directly related to labor or physical materials Which of the following is a supporting tab for a commercial model Argus outputs which of the following is the most common method of interest calculation Actual/360 what is the term for a performance bonus paid to the GP to incentivize out-performance Promote which of the following is not a characteristic of multifamily properties Long term cash flow which of the following is not a key term of commercial leases broker fee

How is Total Lease Value Calculatedsquare footage x rental rate x lease term what is a development feecompensation earned for managing the development process which of the following is the most risky position in the capital stack common equity How does the typical investment horizon of a development differ from an acquisition Shorter what is a good rule of thumb for an acquisition hold period5 years which of the following is not outlined i joint venture legal document purchase price why are interest reserves included in a development budget the lender will require debt service payments during development what is a good way to keep track of assumptions when building a financial model Microsoft Excel cell comments Which of the following would you find on the transaction summary tab of a real estate model Investment returns what is the largest operating expense for any propertyreal estate taxes when are apital expenditures included in operating expenses Never which of the following are subtracted from Potential Base Rent (PBR) to calculate Total Rental Income Rent Abatements and absorption & turnover vacancy what is the standard amortization period for a commercial real estate loan 30 years which of the following is not a method commonly used by lenders to calculate interest

31/365

real estate models are heavily reliant on which of the following Dates and Timelines What is the Internal Rate of Return (IRR) Annual rate of return tenant improvements are a function of what supply and demand which of the following does not describe the Loan termthe rate at which a loan is made Who invests the majority of the capitalLimited Partner What is a good alternative to merging cells Center Across selection what metric can tell the entire story of a potential transationyield-on-Cost what is the largest adjustment made in calculating reversion value for a commercial property Forward Rent Abatements which of the following are subtracted from Gross Potential Rent (GPR) to calculate Net Potential Rent (NPR) Loss to lease and Concesssions what is the equity multiplehow many times an investment pays back its equity what is the first step in a waterfalldetermining how much total cash is available to distribute which of the following is not a way in which revenue is generated by real estate assets broker fees which of the following is not a common ratio used to measure the size of a loan Loan-to-income (LTI) how much cash should be left over at the end of a waterfallnone

what is a good rule of thumb for the amount of contingency to include in the budget as a percentage of the total development budget 5% which of the following does not describe a "core-plus" investment 50% leased multi-tenant property What does Levered Cash Flow (LCF) Measure net cash inflows an outflows after taking into account cash flows related to financing what is a real estate waterfallA method of allocating profits between JV partners in an investment that allows for profits to be distributed unequally why is t important to consider both unlevered and levered investment returns Because real estate is typically highly levered Which of the following is a type of commercial modelOffice Which of the following is not one of the main sheets of a real estate financial Model Engine Which of the following is typically the largest piece of the capital stack Senior Debt what is cash-on-cash returnAnnual cash return on invesment What does "IO" stand forinterest only Which of the following Real estate functions does not rely on financial Models Tenants Which of the following is not a formatting and layout best practice for financial modeling always password protecting your model What new operating expense line item is introduced for industrial properties Common Area Maintenance what is the first line when modeling a waterfall levered cash flow What kind of tables are useful for tweaking a finished model sensitivity which of the following would you find on the inputs and drivers tab of a real estate model property overview Approximately how much turnover do multifamily properties see each year 50% which of the following is not a characteristic of commercial property safety Which of the following measures an asset's cash flow relative to the total loan amount Debt Yield (DY) What is the relationship between cap rates and multiplesinverse what are "untrended stabilized" revenues and expensesrevenues and expenses from a property if it were existing and stabilized today