This page provides a detailed breakdown of your project’s projected cash flow over time, helping you analyze income, expenses, and overall financial performance. It offers a year-by-year view of the cash flow, allowing you to assess the profitability and long-term viability of the investment.
Key Sections:
Total Income: This represents the gross income expected from the property each year, factoring in rents and other revenue streams.
General Vacancy: The projected amount of lost income due to vacancies in the property.
Effective Gross Income: This is the total income after accounting for vacancies, providing a more realistic view of the property’s earning potential.
Total Operational Expenses: The costs of managing and operating the property, including maintenance, utilities, and other recurring expenses.
Net Operating Income (NOI): This is the income left after operational expenses, giving a clear picture of the property's profitability before financing costs.
Loan Interest & Principal: This section details the annual loan repayments, separating interest and principal amounts to show the cost of debt servicing.
CAPEX Reserve: Funds set aside for future capital expenditures (property improvements or major repairs) to maintain or enhance the property’s value.
Net Project Cash Flow: The cash flow remaining after accounting for all expenses, loan payments, and CAPEX reserves. This is a key indicator of the project’s cash-generating ability.
Investment Cash Flow:
Annual Project Cash Flow: A summary of the yearly net cash flow from the project.
Acquisition Costs: The initial cost of acquiring the property, shown in year 0.
Estimated Sale Price: The expected sale price of the property at the time of exit (if applicable), influencing the final year’s cash flow.
Closing Costs: Expenses related to the eventual sale of the property, which reduce the final cash flow in the exit year.
Loan Balance: The remaining loan balance to be repaid at the time of sale, reducing the final cash proceeds.
Cash Flow Summary:
The Investment Cash Flow row shows the net cash generated by the project each year after considering acquisition costs, sale price, and loan balances. This is critical for calculating returns like IRR and equity multiples.
Discount Value & Net Present Value (NPV):
Discount Value: This field allows you to apply a discount rate, helping you calculate the present value of future cash flows.
Net Present Value (NPV): The value of future cash flows in today’s terms, discounted by the rate you input. This helps evaluate the project’s profitability over time.
Review this page carefully to understand the financial trajectory of your project. Use the detailed cash flow analysis to assess if the investment meets your profitability targets and to adjust your strategy as needed.