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Rent Roll Acquisition

Build a complete retail rent-roll acquisition from a near-blank sheet: a four-tenant rent roll with its lease expiry schedule, the in-place underwriting bridge and going-in cap rate, PSF-based leasing and OpEx ratios, a full loan amortization schedule, the TI/LC reserve tested against the renewal cost the actual expiries imply, the forward-NOI exit, and the equity cash flow that drives both levered MoIC and levered IRR.

REPE · Intermediate · about 120 minutes · 54 guided steps

Lesson outline

Tenant Rent Roll (In-Place)

  1. Step 1: Annual Rent by Tenant
  2. Step 2: Rent Roll: Total Leased SF
  3. Step 3: Rent Roll: In-Place Potential Gross Rent
  4. Step 4: Rent Roll: Blended Rent PSF

In-Place Underwriting Bridge

  1. Step 5: In-Place Potential Gross Rent
  2. Step 6: In-Place Effective Gross Income
  3. Step 7: In-Place Operating Expenses
  4. Step 8: In-Place NOI
  5. Step 9: Going-In Cap Rate

Financing & Debt Schedule

  1. Step 10: Loan Amount
  2. Step 11: Annual Debt Service
  3. Step 12: Total Uses
  4. Step 13: Initial Equity
  5. Step 14: Loan: Opening Balance
  6. Step 15: Loan: Interest
  7. Step 16: Loan: Principal Amortization
  8. Step 17: Loan: Ending Balance

Operating Pro Forma

  1. Step 18: Potential Gross Rent
  2. Step 19: Effective Gross Income
  3. Step 20: Operating Expenses
  4. Step 21: Net Operating Income
  5. Step 22: TI/LC Reserve
  6. Step 23: Levered Cash Flow

Lease-Level Rent Schedule (Hold Year)

  1. Step 24: Free Rent by Lease
  2. Step 25: Renewal TI by Lease
  3. Step 26: CAM, Tax & Insurance by Lease
  4. Step 27: Contract Base Rent by Lease and Year
  5. Step 28: Total Contract Base Rent
  6. Step 29: Free Rent Abatement
  7. Step 30: Net Cash Base Rent
  8. Step 31: Pro Forma Rent Above Contract
  9. Step 32: Leasing Capital by Lease Expiry
  10. Step 33: Recoverable CAM (NNN Leases)
  11. Step 34: Unrecovered CAM (Modified-Gross)
  12. Step 35: Exit Value Riding on Growth Above Contract

Leasing Capital Check

  1. Step 36: SF Rolling per Year
  2. Step 37: Implied TI/LC per Rolling SF
  3. Step 38: Total Leasing Capital Over Hold
  4. Step 39: SF Actually Rolling Inside the Hold
  5. Step 40: Renewal TI on Leases Rolling in the Hold
  6. Step 41: Reserve Coverage of Renewal TI
  7. Step 42: Worst Rollover Year
  8. Step 43: Peak-Year Reserve Coverage

Forward (Year 6) & Exit

  1. Step 44: Forward (Year 6) Potential Gross Rent
  2. Step 45: Forward (Year 6) Effective Gross Income
  3. Step 46: Forward (Year 6) Operating Expenses
  4. Step 47: Forward (Year 6) NOI

Returns

  1. Step 48: Implied Sale Value
  2. Step 49: Net Sale Proceeds
  3. Step 50: Exit Equity
  4. Step 51: Total Operating Distributions
  5. Step 52: Levered MoIC

Equity Cash Flow & IRR

  1. Step 53: Equity Cash Flow
  2. Step 54: Levered IRR