Financial Bootcamp. Facilitator Guide Instructions for Half Day Workshop Delivery

Size: px
Start display at page:

Download "Financial Bootcamp. Facilitator Guide Instructions for Half Day Workshop Delivery"

Transcription

1 Financial Bootcamp Facilitator Guide Instructions for Half Day Workshop Delivery September 2017

2 2017 National Apartment Association 2

3 Workshop Information Workshop Length: This workshop is designed to be presented in three hours, including a break. Actual time may vary depending on size of participant group and the knowledge level of participants. The estimated timing for the chapters in this workshop including the activities is as follows. Section 1 Intro/Welcome/Workshop Goals 15 minutes Section 2 Number Types 30 minutes Section 3 Basic Algebra 15 minutes Section 4 Comparing and Predicting 20 minutes Section 5 BREAK Practical Property Management Calculations 15 minutes 35 minutes Section 6 Area, Space, and Volume 15 minutes Section 7 Practice 20 minutes Wrap Up & Q&A & Action Plan Estimated Timing: 15 minutes 3 hours 2017 National Apartment Association 3

4 Instructor Preparation Read this guide carefully. Familiarize yourself with the organization and flow of the workshop, as well as the content itself. Review all the materials thoroughly and ensure that you are completely comfortable with all the information and calculations. Even though this is a short workshop (1/2 day) with no exam, you should plan on spending several hours reviewing the materials, planning your workshop, and practicing the calculations. Do a dry run of the material (or at least some of it) in front of willing colleagues or family members. Materials & Equipment Needed: Financial Bootcamp Facilitator Guide for yourself Financial Bootcamp Participant Guide for each participant and one for yourself Financial Bootcamp PowerPoint Slides Calculators for each student and one for yourself (make sure to check if the host is providing those or if students need to bring them) Flipchart and stand or Whiteboard and colored markers Computer, projector, and handheld clicker with laser pointer Microphone or sound system (depending on size of room and participant group) Using This Guide Facilitator Instructions are indicated by < >. There is a suggested narrative for each slide included in this guide. The slides coordinate with the text and contain examples and participant activities as noted National Apartment Association 4

5 Table of Contents Section 1: Welcome, Introductions, and Workshop Goals... 9 Participant Introductions... 9 Learning Goals and Objectives... 9 Section 2: Number Types Rounding Fractions Parts of a Fraction Fractions Additions (When the Denominator is the same) Fractions Additions (When the Denominator is different) Simplify or Reduce a Fraction Fractions Subtraction Fractions Multiplication Fractions - Division When the Numerator is Larger than the Denominator Decimals Changing Decimals to Percentages Changing Fractions to Decimals Percentages Section 3: Basic Algebra Solving for the Unknown (Addition and Subtracting) Solving for the Unknown (Multiplication and Division) Section 4: Comparing and Predicting Averages Average vs. Weighted Average Average vs. Median Annualization versus Extrapolation Annualization Extrapolation Section 5: Practical Property Management Calculations Closing Ratio National Apartment Association 5

6 Resident Turnover Rate Physical Occupancy Economic Occupancy Variance Percentage Percentage Change Rent Increase Percentage Using Percentages to Change a Number (Where number increases) Using Percentages to Change a Number (Rent Increase example where the percentage is known) Using Percentages to Change a Number (Where number decreases) Using Percentages to Change a Number (Where number decreases another example) Break-Even Occupancy Ratio Operating Expense Ratio Loan to Value Ratio Return on Investment (ROI) Cap Rate Section 6: Area, Space, and Volume Calculating Perimeter Calculating Area Calculating Volume Section 7: Practice Rent Per Square Foot Cost Per Unit Pro-Rations Payback Period Variances Operating Expense per Square Foot Action Plan National Apartment Association 6

7 2017 National Apartment Association 7

8 SECTION 1 Welcome, Introductions, and Workshop Goals 2017 National Apartment Association 8

9 Slide 1 Section 1: Welcome, Introductions, and Workshop Goals <Welcome participants to the workshop and introduce yourself if you weren t introduced by the workshop host. Let the participants know that this half day workshop has been designed by NAA to provide them with an opportunity to refresh and sharpen their math skills in preparation for taking the CAM or CAPS Credential Program. Let them know they will be doing calculations throughout the workshop. Participants will be required to write out the calculations they are solving to aid in understanding the methodology behind the calculations.> Participant Introductions <If the group size is less than 20, consider asking participants to introduce themselves by name, company, and why they chose to attend this workshop. If the group size is larger, ask participants to introduce themselves to several of the participants around them. Of course, you can use your own icebreaker activity that fits the time frame if you d like.> Slide 2 Learning Goals and Objectives This workshop will help you achieve six key learning objectives. These goals are to: 1. Refresh your knowledge of fundamental math functions: fractions, decimals, rounding, and percentages 2. Solve for the unknown using basic algebra 3. Understand averages versus weighted averages 4. Learn the difference between annualization and extrapolation 5. Understand how to calculate area 6. Work with common property management calculations that you will use in the CAM and CAPS programs 2017 National Apartment Association 9

10 2017 National Apartment Association 10

11 SECTION 2 Number Types 2017 National Apartment Association 11

12 Let s get started by looking at some number types. Slide 3 Section 2: Number Types We re going to look at several number types: fractions, decimals, and percentages, but first, let s look at the process of rounding. Slide 4 Rounding It s much more efficient to work with values when they are rounded to the nearest tenth or hundredth. Slide 5 In the CAM and CAPS credential courses, you may be instructed to round to the nearest tenth when working with percentages, and to whole numbers when working with dollar amounts. The fundamental rounding technique tells us if the number you are rounding is followed by 5, 6, 7, 8, or 9, round the number up. If it s followed by 4, 3, 2, or 1, round the number down. Slide 6 Remember to use whole numbers when working with dollar amounts. Slide 7 Fractions Fractions are a big part of our daily lives, even if we don t realize it. Perhaps it s when you split the check at lunch with your friends. Or when you want to make half of that stir fry dish for dinner and you only need ½ of 1/3 cup of olive oil. In property management, sometimes we have to allocate expenses across multiple properties or figure out our break-even occupancy, so we need to understand fractions National Apartment Association 12

13 Slide 8 Parts of a Fraction The top number of a fraction is called the numerator and the bottom number is the denominator. The denominator tells the total number of parts in the fraction. This number shows how many equal 'pieces' something has been divided into. Slide 9 Fractions Additions (When the Denominator is the same) When adding fractions with the same denominator, the denominator stays constant. The addition takes place with the numerator only. Slide 10 Fractions Additions (When the Denominator is different) When adding fractions with different denominators, there are a few steps required. In order to add the fractions, we have to convert the denominator to a common denominator. Step 1: Multiply both numbers on the first fraction by the bottom number of the second fraction. We're not changing the value of the fraction; we're just changing how the fraction looks. It's still the same fraction. Step 2: Multiply both numbers on the second fraction by the bottom number of the first fraction. Again, we're not changing the value of the fraction; we're just changing how the fraction looks. It's still the same fraction. Step 3: Add the numerators of the two fractions together. Step 4: Simplify (or reduce if needed) National Apartment Association 13

14 Slide 11 Simplify or Reduce a Fraction To reduce a fraction to its simplest form, divide both the numerator and denominator by the Greatest Common Divisor (GCD). The GCD may be obvious, or it may take several steps to find the simplest version of the fraction. Slide 12 Fractions Subtraction If you are subtracting fractions that have a common denominator, all that is required is to subtract the numerator. (Top example on slide) If the denominators are different, we ll use the same steps we used when adding fractions with different denominators. (Bottom example on slide.) Step 1: Multiply both numbers on the first fraction by the bottom number of the second fraction. We're not changing the value of the fraction; we're just changing how the fraction looks. It's still the same fraction Step 2: Multiply both numbers on the second fraction by the bottom number of the first fraction. Again, we're not changing the value of the fraction; we're just changing how the fraction looks. It's still the same fraction. Step 3: Add the numerators of the two fractions together. Step 4: Simplify (or reduce if needed) National Apartment Association 14

15 Slide 13 Fractions Multiplication Multiplying fractions is straightforward. Multiply the numerator and the denominator and simplify if needed. <Have participants simplify the answer.> Slide 14 Fractions - Division Dividing fractions is a bit more complex. There are three things to remember when dividing fractions. 1. Leave the first fraction as is. 2. Change the divide function to multiply. 3. Turn the second fraction over or invert the one you are dividing by. Slide 15 <Walk through example using the Leave, Change, Turn process. Let participants simplify the answer.> Slide 16 When the Numerator is Larger than the Denominator Sometimes a fraction calculation will result in the top number the numerator being larger than the bottom number the denominator. In this case, the denominator is divided into the numerator to simplify the fraction, resulting in a whole number/decimal combination. To convert the decimal back into a fraction, we leave the whole number as it is. Convert 0.25 to a fraction: 0.25=25/100. Then reduce the fraction to the lowest term, which is 1/ National Apartment Association 15

16 If the decimal goes to the 10 th spot, you d multiply by 10; if it goes to the 1000 th spot, you d multiply by Slide X 100 = 25 1 X 100 = /100 = ¼ Slide 18 Decimals Decimals are important because we use them every day in different situations, such as counting money, looking at price tags, calculating miles per gallon, or figuring price per square foot. Slide 19 Changing Decimals to Percentages To convert a decimal to a percent, multiply the decimal by 100, then add the % symbol. An easy way to multiply a decimal by 100 is to move the decimal point two places to the right. Slide 20 Practice 2017 National Apartment Association 16

17 Slide 21 Changing Fractions to Decimals The diagram on the slide shows the relationships between percentages, decimals, and fractions. To change a fraction to a decimal to get to a percentage, divide the top of the fraction (the numerator) by the bottom (the denominator), multiply by 100 and add a "%" sign. If the fraction is 1/10, divide 10 into 1 resulting in 0.1. Then, using the process we looked at earlier, move the decimal point two places to the right and add the % sign resulting in 10%. Slide 22 Percentages Fractions, decimals and percentages are related and can be used to express the same number, or proportion, in different ways. If we understand fractions, decimals, and percentages, we have the basis for being able to make sound estimations and valuable calculations. Many of the Key Performance Indicators (KPI) and benchmark figures your company may use to evaluate performance or achievement are in the form of a percentage. Think about closing ratios and work order completions. Slide 23 The diagram on this slide shows the relationship between fractions, decimals, and percentages and demonstrates how one number can be expressed in multiple forms. Slide 24 Looking at the example number from the previous slide, 3/10 becomes a decimal by dividing the denominator into the numerator. It becomes a % by moving the decimal point 2 places to the right National Apartment Association 17

18 Slide 25 <Using the ¾ case of light bulbs from the earlier example, have participants convert the fraction to a percentage.> 2017 National Apartment Association 18

19 2017 National Apartment Association 19

20 SECTION 3 Basic Algebra 2017 National Apartment Association 20

21 In addition to fractions, decimals, and percentages, there are some basic algebra functions that can be helpful in our property management world. Slide 26 Section 3: Basic Algebra Algebra is a form of mathematics that uses letters or symbols for unknown numbers so that we can solve for those unknowns. Slide 27 Solving for the Unknown (Addition and Subtracting) We may know that A = B + C, but what if we only have A and C? We find B by subtracting the last figure from both sides. Slide 28 Solving for the Unknown (Multiplication and Division) The same principle applies to multiplying and dividing National Apartment Association 21

22 Slide 29 Slide National Apartment Association 22

23 2017 National Apartment Association 23

24 SECTION 4 Comparing and Predicting 2017 National Apartment Association 24

25 Much of the financial analysis we conduct in property management pertains to comparing data to historical information or market data, and predicting future income and expenses. Slide 31 Section 4: Comparing and Predicting Let s look at a few tools to help us perform those tasks. Slide 32 Averages Many of the Key Performance Indicators used in Property Management are averages: things like average rent per square foot and average square feet. Using an average, or a weighted average, aids in analytical comparison of data from multiple sources. Slide 33 To determine an average, add all the figures together and divide by the number of figures used. In this example, to determine the average square footage and average rent, add the figures in each column and divide by 5. Average Square Footage: , , ,650 = 5,280 5 = 1,056 Average Rent: $575 + $720 +$925 + $1,250 + $1,800 = $5,270 5 = $1, National Apartment Association 25

26 Slide 34 Average vs. Weighted Average A weighted average is the average of values which are scaled by importance. The weighted average of values is the sum of weights times values divided by the sum of the weights. To find a weighted average, calculate the TOTAL square footage and rent for all units first. In this example, we would multiply the # of units x the SF and Rent for each unit type to determine the total square footage and total rent. The totals are divided by the total # of units. Slide 35 Average vs. Median Total SF # of Units = weighted average SF 264, = 1,019 Total Rent # of Units = weighted average rent 258, = $996 As we saw earlier, to determine an average, the total of all the figures is divided by the number of figures = 11,400 11,400 9 = or 1267 The "median" is the "middle" value in the list of numbers. To find the median, the numbers should be listed in numerical order from smallest to largest; then identify the middle one of the list. In this example, there are 9 numbers so the middle number (the one in the 5 th spot) is the middle or median. If there were an even number of items on the list, the median would be the midpoint between the figures in the middle 2 spots National Apartment Association 26

27 Slide 36 Average SF: = = 1,124.8 or 1,125 SF Average Rent: = = $1, or $1,170 Total SF Total # of Units = weighted average SF 216, = 1,021 Total Rent Total # of Units = weighted average rent 211, = $998 Slide 37 Annualization versus Extrapolation While we typically think of annualization and extrapolation as being part of the budget process, we can also use them to reforecast financial performance throughout the year. Sometimes these two concepts are used interchangeably but they are different. Slide 38 Annualization Let s look at annualization first. To annualize a dollar amount, determine the average monthly amount by adding the amounts that are known together, and divide by the # of months represented. This provides an average monthly amount that is then multiplied by 12 months to estimate an annual amount National Apartment Association 27

28 Slide 39 Extrapolation Extrapolation takes a list of known numbers and extends the list based on what can be predicted from the list of known numbers. In this example, we can see that the monthly amount has increased by $300 each month so we can predict that trend will continue in the coming months. Before extrapolating known data, check that the numbers aren t skewed for some reason (artificially high or low), and that seasonal changes or anomalies have been considered. Slide 40 Calculate the total for each line item. Advertising, Office Supplies, and Landscape Maintenance are extrapolated by using the number trend shown in the diagram. Clubhouse/Amenity Expense and Appliance Repair are Annualized. Clubhouse/Amenity Expense: = 1,343 1,343 8 = x 12 = 2, or $2, National Apartment Association 28

29 Appliance Repair Expense: = 1,882 1,882 8 = x 12 = $2,823 Slide 41 BREAK Take a 15-minute break before transitioning to Property Management Calculations 2017 National Apartment Association 29

30 2017 National Apartment Association 30

31 SECTION 5 Property Management Calculations 2017 National Apartment Association 31

32 Now that we ve reviewed decimals, fractions, percentages, averages, annualization, and extrapolation, let s look at how they are used in property management calculations. Slide 42 Section 5: Practical Property Management Calculations There is a long list of important calculations in property management. Many are important Key Performance Indicators (KPI), and some are important measurements for lenders and owners. Slide 43 Practical Property Management Calculations In the next phase of the workshop, we will explore these calculations. Closing Ratio Resident Turnover Rate Physical Occupancy Economic Occupancy Variance Percentage Rent Increase Percentage Percent Change Calculating Area Breakeven Occupancy Operating Expense Ratio Loan-to-Value Rate of Return Cap Rate 2017 National Apartment Association 32

33 Slide 44 Closing Ratio A closing ratio measures the number of leases or closed sales being secured as a portion of all potential sales. It s a KPI used to determine the sales effectiveness of the leasing team. Many companies set a closing ratio goal for the leasing team, usually 35-40%, but it varies. To calculate closing ratio, the number of leases is divided by the number of traffic. But what happens if a lease (application) is not approved for some reason? When we adjust the number of closed sales, and recalculate, what is the NET closing ratio? 2 12 =.167 = 16.7% Slide 45 Resident Turnover Rate Resident turnover rate shows the ratio of move-outs compared to the total number of units. Resident turnover rate is most often stated as an annual figure. Organizations often set a resident turnover goal for each property or submarket, usually 50-60%, but those goals vary depending on property type and market conditions. In the student housing market, the turnover rate can be as high as 100% or even higher in some cases National Apartment Association 33

34 To determine resident turnover rate, the number of move-outs is divided by the total number of units =.6269 = 62.7% Slide 46 Physical Occupancy Physical Occupancy is calculated by dividing the number of occupied units by the total number of units. (Example on slide.) =.903 = 90.4% Slide 47 Economic Occupancy Economic Occupancy represents occupancy after vacancy, bad debt, concessions, and non-revenue units have been factored out. The formula is Total Rent Revenue Gross Potential Rent. Note: You ll learn more about GPR and TRR in CAM. Slide 48 $207,320 $248,595 = or 83.4% Economic Occupancy 2017 National Apartment Association 34

35 Slide 49 Variance Percentage When there is a variance between actual expenses or income and budgeted expenses or income, the variance is often expressed as a percentage to aid in comparison and analysis. To calculate a variance percentage, the actual amount is subtracted from the budgeted amount to find the dollar variance. The variance number is then divided by the budgeted amount. $2,500 - $2,300 = $200 $2,500 = 0.08 = 8.0% This answer represents a favorable variance since the amount of total expenses is less than budgeted. $1,800 - $1,100 = $700 $1,800 = = 38.9% This answer represents an unfavorable variance since the amount of income is less than budgeted. Slide 50 Percentage Change We are often asked to express changes over time as a percentage. This is done by dividing the change amount by the older or earlier amount. Looking at the amount of the water bill each month for the last 4 months, we see that from April to May, there was an increase of $250. If the increase amount is divided by the earlier amount of $5,000, we see that the percentage change in May is 5.0% National Apartment Association 35

36 What is the percentage change for June? $5,785 - $5,250 = $535 $5,250 = = 10.2% What is the percentage change for July? $6,360 - $5,785 = $575 $5,785 = = 9.9% Slide 51 Rent Increase Percentage We can use that same percentage change process to determine rent increase percentages. The increase amount is divided by the old rate. $925 - $850 = $75 $850 = = 8.8% Slide 52 Using Percentages to Change a Number (Where number increases) In the percentage change process we just reviewed, the numbers were known so those numbers were used to calculate the percentage. Sometimes we know the percentage but need to find the number. For example, we know that Bob Brown earns $35,000 per year as a maintenance tech. If he gets a 3% pay increase, what is his new salary? $35,000 x.03 = $1,050 + $35,000 = $36, National Apartment Association 36

37 Alternate Solution: $35,000 x 1.03 = $36,050 (this process saves a step by including the whole number 1 to the known number) Slide 53 Using Percentages to Change a Number (Rent Increase example where the percentage is known) We looked at rent increase percentage earlier where we knew the old and new rate, but if we need to calculate the new rate based on a known percentage, we can do that by multiplying the percentage by the known rate. $525 x.04 = $21 + $525 = $546 (to raise rent by 4%) OR $525 x 1.04 = $546 Slide 54 Using Percentages to Change a Number (Where number decreases) If the percentage indicates a reduction, we still use the known number multiplied by the percentage to find the change number. Then we subtract that number from the original known number. <Have participants answer. What is 93.5% of $1,800?> $1,800 x.065 = $117 $1,800 - $117 = $1, National Apartment Association 37

38 Alternate Solution: Similar to the alternate solution we reviewed on the previous slide, we can subtract the known percentage from whole number 1, and use that percentage to multiply the known dollar amount = $1,800 x = $1,683 Slide 55 Using Percentages to Change a Number (Where number decreases another example) <Have participants answer. What is 88% of $15,600?> $15,600 x.12 = $1,872 $15,600 - $1,872 = $13,728 OR $15,600 x.88 = $13,728 Slide 56 Break-Even Occupancy Ratio Break-Even Occupancy Ratio is an important measurement as it tells us the lowest occupancy percentage a property can maintain and still be able to pay all the necessary bills. When a property s occupancy falls below the break-even occupancy level, the owner may have to supplement the property financially, which is never a desirable scenario National Apartment Association 38

39 Break-even occupancy is calculated by adding the expense components the property is responsible for paying - operating expenses, debt service, and replacement reserve (if applicable) and dividing it by Effective Gross Income (total revenue including other income for the property). Note: You ll learn more about GPR and EGI in CAM. (OE + DS + RR) EGI (Operating Expenses + Debt Service + Replacement Reserve) Effective Gross Income Calculate the Break-Even Occupancy Ratio using the following information: Operating Expenses are $525,667 Debt Service is $306,000 Replacement Reserve is $125,000 Effective Gross Income is $1,101,660 ($525,667 + $306,000 + $125,000) $1,101,660 =.868 or 86.8% Based on this example, the property will need a to maintain 86.8% occupancy rate in order to break even. Slide 57 Operating Expense Ratio Operating expense ratio is an important Key Performance Indicator in property management as it shows the correlation between our operating expenses and our total property revenue. It is calculated by dividing Effective Gross Income into the annual Operating Expenses. OE/EGI = Operating Expense Ratio 2017 National Apartment Association 39

40 Using the following information, calculate the OE Ratio Operating Expenses (OE) = $1,411,870 Gross Potential Rent (GPR) = $2,957,350 $1,411,870 2,957,350 = = 47.7% Slide 58 Loan to Value Ratio Another important measurement, Loan to Value Ratio (LTV), is expressed as a percentage. The lower the LTV, the lower the risk to the lender. It answers the question, how much of the property s value is covered by the loan. The higher the percentage, the higher the risk to the lender. It is calculated by dividing the property value into the loan amount. If the loan amount is $35,000,000 and the property value is $48,000,000, what is the loan value? $35,000,000 $48,000,000 = or 72.9% Slide 59 Return on Investment (ROI) Return on Investment measures the rate of return based on a property s income stream. It is used to identify the efficiency of an investment. It is calculated by dividing NOI by the property value National Apartment Association 40

41 If Heavenly Haven s NOI is $890,000 and the value of the property is $9,000,000, what is the ROI? $890,000 $9,000,000 = or 9.9% Slide 60 Cap Rate Cap Rate is a rate of return used to measure a property s value based on its NOI and to reflect the investor s desired ROI. The lower cap rate = higher value; the higher cap rate = lower value. The Cap Rate is calculated by dividing NOI by the purchase price. Once the Cap Rate is determined, you can find the value by dividing the Cap Rate into NOI. If NOI is $605,875 and the purchase price is $9,000,000, what was the Cap Rate? What is the value of the property based on its income? $605,875 $9,000,000 = or 6.7% $605, % = $9,042,910 This example show that the property is valued at a higher rate than the price the owner originally paid for the asset National Apartment Association 41

42 2017 National Apartment Association 42

43 SECTION 6 Area, Space and Volume 2017 National Apartment Association 43

44 Understanding how area and space is calculated can be very helpful in our property management world. Slide 61 Section 6: Area, Space, and Volume Knowing how to calculate area, space and volume can allow us to calculate the volume of a swimming pool, the area of a room to be painted, or the size of an apartment unit. Slide 62 Calculating Perimeter Calculating the perimeter of a space can provide us with valuable marketing information or allow us to verify information we ve been given. Slide 63 Calculating Perimeter The perimeter is the sum of all sides of the area. This may be useful in determining in how many feet of holiday lights you would need to go around the building or how many feet of molding you ll need to add a chair rail. Slide 64 Calculating Area Area is the measurement of how much space there is inside a room or space National Apartment Association 44

45 Slide 65 Calculating Area Area is determined by multiplying width times height. Calculating the area of a space can be useful for determining how much paint to buy to cover a wall or how much grass seed is needed for an area of the lawn. Slide 66 Calculating Volume Calculating volume can be useful in estimating costs and determining how much a vessel or container can hold. Slide 67 Calculating Volume In property management, the most common need for calculating volume is for determining how many gallons of water a swimming pool holds. Volume is calculated by multiplying width x height x depth. The result gives us cubic feet. (Example on slide) In this example, the swimming pool is cubic feet. 20 ft. x 12 ft. x 5 ft. = 1,200 cubic feet 2017 National Apartment Association 45

46 If there is cubic feet in a gallon, how many gallons will this pool hold? 1, = 8,955 gallons 2017 National Apartment Association 46

47 2017 National Apartment Association 47

48 SECTION 7 Practice 2017 National Apartment Association 48

49 We ve covered a lot in this workshop: fractions, decimals, formulas and more! And we ve completed some calculations for practice. Let s spend a few more minutes practicing what we ve learned. Slide 68 Section 7: Practice Property management software does much of the calculation for us in today s world. Software isn t flawless and there are hundreds of behind-the-scenes settings that may impact the results we see on reports and dashboards. That makes it important for us to be able to manually calculate when needed or as a way to verify the accuracy of what our property management software system tells us. Slide 69 Rent Per Square Foot Rent per square foot can help us more appropriately compare our rental rates with our competition. It expresses the rent rate in a way that allows for apples-toapples comparison. What is the AVERAGE Rent Per Square Foot? ( ) 5 (the # of floorplans) = $1.03 What is the WEIGHTED AVERAGE Rent Per square Foot? Average Rent Average SF $996 1,019 = $ National Apartment Association 49

50 Slide 70 Cost Per Unit <Tell participants two different calculations will be used to complete the graph.> Expenses are often expressed in a cost-per-unit manner. This allows us to be able to compare the results of multiple properties in a meaningful manner. Heavenly Haven has 260 units. Cost per unit is determined by dividing the number of units into the total expense. $32, = $125 $256, = $985 and so on. The TOTAL cost per unit is determined by adding together the CPU for each line item. Slide 71 Pro-Rations , = 4,665 total cost Aside from dealing with pro-rated rent at move-in and move-out, we sometimes have to allocate a portion of a salary or expense to multiple properties. To determine the portion of Mary s salary that each property should pay, divide each property s total units by the total # of units to determine an allocation percentage. Then multiply that % by the total salary. To determine how much each property pays for the joint ad, divide $15,000 by 600 to determine the cost per unit ($25) and then multiply the cost per unit by the # of units for each property National Apartment Association 50

51 Slide 72 Payback Period When recommending upgrades or improvements to a property, one of the critical calculations that will help obtain approval is the estimated payback period. In this example, the number of units multiplied by the cost of the washers/dryers gives us the total cost of the upgrade. What is the total cost? If we know we will be able to charge an extra $50 for the 50 units we upgrade, the monthly additional income would be how much? At $2,500 per month, it will take how many months to recoup the total cost of the washers/dryers? Of course, that assumes that each of these units will be occupied every month. The payback period may be slightly longer if these units are vacant for periods of time during the 13.6 months. $680 per washer/dryer in one unit $50 additional revenue x 50 units = $2,500/month $680 $50 = 13.6 months to recoup cost 2017 National Apartment Association 51

52 Slide 73 Variances Application Fees are budgeted to be $165,000 for the year. Actual Application Fees for the year is $153,357. What are the variance % compared to budget? 165, ,357 = (11,643) negative variance -11,643 $165,000 = or -7.1% This example shows an unfavorable variance since the actual income is less than budgeted. Slide 74 Operating Expense per Square Foot Biscayne Bay is a 320-unit apartment community with 353,000 total square feet. For the period ending August 31, the Operating Expenses total $1,237,643. What is annual operating expense per square foot? (Hint: don t forget to annualize.) $1,237,643 8 = $154,705 x 12 = $1,856,465 $1,856, ,000 SF = $ National Apartment Association 52

53 Slide 75 Wrap-Up <Wrap by asking the participants if they have any final questions or want to go over any component of the workshop one more time. Ask them how they feel about what they learned.> Slide 76 Action Plan <Have the participants complete the action plan worksheet in their participant guide. Once they are done, ask for volunteers to share an action item from their plan.> Slide 77 THANK YOU Thank you for being here today. Congratulations on investing in yourself with continued learning! 2017 National Apartment Association 53

Financial Bootcamp. Participant Guide SAMPLE

Financial Bootcamp. Participant Guide SAMPLE Financial Bootcamp Participant Guide September 2017 2017 National Apartment Association 2 Table of Contents Section 1: Welcome... 6 Participant Introductions... 6 Learning Goals and Objectives... 6 Section

More information

Financial Bootcamp. Facilitator Guide Instructions for Half Day Workshop Delivery

Financial Bootcamp. Facilitator Guide Instructions for Half Day Workshop Delivery Financial Bootcamp Facilitator Guide Instructions for Half Day Workshop Delivery March 2018 LIMITS OF LIABILITY AND DISCLAIMER OF WARRANTY 2017 by the National Apartment Association, 4300 Wilson Boulevard

More information

Financial Bootcamp SAMPLE. Participant Guide

Financial Bootcamp SAMPLE. Participant Guide Financial Bootcamp Participant Guide March 2018 LIMITS OF LIABILITY AND DISCLAIMER OF WARRANTY 2017 by the National Apartment Association, 4300 Wilson Boulevard Suite 400 Arlington, VA 22203. All rights

More information

REAL ESTATE. Practice in Illinois. Modern EIGHTH EDITION

REAL ESTATE. Practice in Illinois. Modern EIGHTH EDITION Modern REAL ESTATE Practice in Illinois EIGHTH EDITION Fillmore W. Galaty, Wellington J. Allaway, and Robert C. Kyle, with Karen Stefano, Consulting Editor, and Chris Read, Contributing Editor 24 C H A

More information

Four (4) Factors in Investment Definition: Investment

Four (4) Factors in Investment Definition: Investment Introductions Your name Where you work Your job responsibilities How long you have been in the industry What you hope to get from this class Chapter 1: Investments Agenda 2 Investments Adding Value to

More information

The result of your calculations is the Net Operating Income, or monthly cash flow BEFORE any mortgage payments.

The result of your calculations is the Net Operating Income, or monthly cash flow BEFORE any mortgage payments. CHEAT SHEET #6 NET OPERATING INCOME (IS YOUR RENTAL REALLY MAKING MONEY?) The Net Operating Income calculation is fairly straightforward. al income minus the expenses to own and operate the property equals

More information

$450,000 $63,425 $33, % PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE

$450,000 $63,425 $33, % PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE Executive Summary Key Property Metrics $450,000 $63,425 $33,431 14.1% PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE $60,000 $50,000 $40,000 $30,000 Annual Cash Flow Maintenance & Repairs,

More information

2. The, and Act, also known as FIRREA, requires that states set standards for all appraisers.

2. The, and Act, also known as FIRREA, requires that states set standards for all appraisers. CHAPTER 4 SHORT-ANSWER QUESTIONS 1. An appraisal is an or of value. 2. The, and Act, also known as FIRREA, requires that states set standards for all appraisers. 3. Value in real estate is the "present

More information

Chapter 18. Investors have different required yields Different risk assessment Different opportunity cost of equity

Chapter 18. Investors have different required yields Different risk assessment Different opportunity cost of equity Decision Making in Real Estate Centers Around Valuation Chapter 18 Investment Decisions: Ratios We examined the concept of market value in Chapters 7 & 8 As noted, professional RE appraisers are often

More information

I R V. where I = Annual Net Income, R= Capitalization Rate and V= Value

I R V. where I = Annual Net Income, R= Capitalization Rate and V= Value Income Approach to Valuation Capitalization (Cap Rates) the short version! Capitalization is the process of converting net income into a meaningful value that correlates net income to the value of the

More information

PREPARING FOR THE MINNESOTA INCOME PROPERTY CASE STUDY EXAM WORKSHOP

PREPARING FOR THE MINNESOTA INCOME PROPERTY CASE STUDY EXAM WORKSHOP PREPARING FOR THE MINNESOTA INCOME PROPERTY CASE STUDY EXAM WORKSHOP Date: September 18, 2018 Location: Country Inn & Suites Chanhassen, MN Instructor: Bob Wilson, CAE, ASA Revised October, 2017 PREPARING

More information

LIMITS OF LIABILITY AND DISCLAIMER OF WARRANTY

LIMITS OF LIABILITY AND DISCLAIMER OF WARRANTY I nst r uct or sgui de LIMITS OF LIABILITY AND DISCLAIMER OF WARRANTY 2014 by the National Apartment Association, 4300 Wilson Boulevard Suite 400 Arlington, VA 22203. All rights reserved. The course materials

More information

$450,000 $63,425 $39, % PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE

$450,000 $63,425 $39, % PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE Executive Summary Key Property Metrics $450,000 $63,425 $39,143 14.1% PURCHASE PRICE NET OPERATING INCOME ANNUAL CASH FLOW CAP RATE $70,000 $60,000 $50,000 $40,000 $30,000 Annual Cash Flow Repairs, 8%

More information

Chapter 8. How much would you pay today for... The Income Approach to Appraisal

Chapter 8. How much would you pay today for... The Income Approach to Appraisal How much would you pay today for... Chapter 8 One hundred dollars paid with certainty each year for five years, starting one year from now. Why would you pay less than $500 Valuation Using the Income Approach

More information

Deal Analyzer For Flips

Deal Analyzer For Flips Preview Of What You Will Learn Sections: Introduction...5 Using This Manual...7 Section 1: General Property Information...8 Section 2: Property Values & Pricing......9 Section 3: Financing Costs...12 Section

More information

INSIDER S GUIDE. The 5 Most Powerful Ways to Improve Tenant Satisfaction Today

INSIDER S GUIDE. The 5 Most Powerful Ways to Improve Tenant Satisfaction Today INSIDER S GUIDE The 5 Most Powerful Ways to Improve Tenant Satisfaction Today Tenant satisfaction significantly impacts your bottom line. Overview: The Real Cost of Tenant Dissatisfaction You try hard

More information

Chapter 8. How much would you pay today for... The Income Approach to Appraisal

Chapter 8. How much would you pay today for... The Income Approach to Appraisal How much would you pay today for... Chapter 8 One hundred dollars paid with certainty each year for five years, starting one year from now. Why would you pay less than $500 Valuation Using the Income Approach

More information

Appraisal Review: Analyzing the 1004

Appraisal Review: Analyzing the 1004 Appraisal Review: Analyzing the 1004 1 LIVE ONLINE PARTICIPANT GUIDE Version: 8.12 Table of Contents The Purpose of the Appraisal... 3 Define Market Value... 3 Scenario 1 (John Johnson report) - 1004 Uniform

More information

Unlike normal companies, real estate investment trusts (REITs) are collections of individual properties.

Unlike normal companies, real estate investment trusts (REITs) are collections of individual properties. Linking Individual Properties to REITs Unlike normal companies, real estate investment trusts (REITs) are collections of individual properties. Sure, they have management teams and overhead and other business

More information

HC FINAL COST CERTIFICATION FORM AND INSTRUCTIONS

HC FINAL COST CERTIFICATION FORM AND INSTRUCTIONS HC FINAL COST CERTIFICATION FORM AND INSTRUCTIONS The Final Cost Certification Application (FCCA) must be completed by the Applicant and returned to Florida Housing along with an unqualified audit report

More information

BUSI 330 Suggested Answers to Review and Discussion Questions: Lesson 10

BUSI 330 Suggested Answers to Review and Discussion Questions: Lesson 10 BUSI 330 Suggested Answers to Review and Discussion Questions: Lesson 10 1. The client should give you a copy of their income and expense statements for the last 3 years showing their rental income by

More information

UNIT FIVE RATIONAL EXPRESSIONS 18 HOURS MATH 521B

UNIT FIVE RATIONAL EXPRESSIONS 18 HOURS MATH 521B UNIT FIVE RATIONAL EXPRESSIONS 8 HOURS MATH 5B Revised Nov4, 00 07 SCO: By the end of grade students will be epected to: B model (with concrete materials and pictorial representations) and epress the relationship

More information

Cost Segregation Instructor Teaching Schedule (3-Hour)

Cost Segregation Instructor Teaching Schedule (3-Hour) Time Topic Pages Student Objectives 8:30-8:35 Course introduction Page 2 What is cost segregation? Objective of cost segregation: to increase cash flow Benefit of cost segregation Learning objectives Page

More information

2016 Level I Tutorials. Income Approach to Value

2016 Level I Tutorials. Income Approach to Value 2016 Level I Tutorials Income Approach to Value 1 The income approach is based on the principal that the value of an investment property reflects the quality and quantity of the income it is expected to

More information

Project Economics: The Value of Leasing. Russell Banham, Savills

Project Economics: The Value of Leasing. Russell Banham, Savills ICSC European Retail Property School Project Economics: The Value of Leasing Russell Banham, Savills (Investment, Development & Asset Management) Introduction Who I am Russell Banham Over 30 years of experience

More information

House Party Planning Kit

House Party Planning Kit Party to End Hunger in India House Party Planning Kit House parties are a great way to educate friends and family, recruit new supporters, generate action, and raise funds for Akshaya Patra s work. This

More information

Lesson 1: Real Estate Math

Lesson 1: Real Estate Math Lesson 1: Real Estate Math The Language of Math Topics This section focuses on the following topics: Key Terms Overview Fractions Decimals Percentages Learning Objectives At the conclusion of this section

More information

concepts and techniques

concepts and techniques concepts and techniques S a m p l e Timed Outline Topic Area DAY 1 Reference(s) Learning Objective The student will learn Teaching Method Time Segment (Minutes) Chapter 1: Introduction to Sales Comparison

More information

Risk Management Insights

Risk Management Insights Risk Management Insights Appraisal Review Part II: Income Capitalization Approach George Mann, Managing Director and Chief Appraiser, Collateral Evaluation Services, Inc.and Nikki Griffith, MAI, CCIM,

More information

The 5 biggest house-flipping mistakes that will cost you serious time and money and how to avoid them

The 5 biggest house-flipping mistakes that will cost you serious time and money and how to avoid them Doug Hopkins Free Special Report The 5 biggest house-flipping mistakes that will cost you serious time and money and how to avoid them Hi! Doug Hopkins here from the Property Wars TV show on The Discovery

More information

California Real Estate License Exam Prep: Unlocking the DRE Salesperson and Broker Exam 4th Edition

California Real Estate License Exam Prep: Unlocking the DRE Salesperson and Broker Exam 4th Edition California Real Estate License Exam Prep: Unlocking the DRE Salesperson and Broker Exam 4th Edition ANSWER SHEET INSTRUCTIONS: The exam consists of multiple choice questions. Multiple choice questions

More information

Benchmarking Your CCRC

Benchmarking Your CCRC Benchmarking Your CCRC Presented by: Moore Stephens Lovelace, P.A. Objectives Provide information on how ratios can provide insight into financial statements Give information about key ratios and what

More information

Do You Want to Buy a Home but have Poor Credit or Little in Savings?

Do You Want to Buy a Home but have Poor Credit or Little in Savings? Do You Want to Buy a Home but have Poor Credit or Little in Savings? If you re reading this guide, you re likely considering rent to own (also commonly referred to as lease to own ) properties because

More information

Sales Course. Math Review. Gold Coast School of Real Estate. Chapter 10

Sales Course. Math Review. Gold Coast School of Real Estate. Chapter 10 Sales Course Chapter 10 Math Review Gold Coast School of Real Estate 1 P 172-174 How many acres are in a tract identified as the N½, of the SE ¼, of the SW ¼, of the N½? 640 2 4 4 2 = 10 acres Copyright

More information

Business Valuation More Art Than Science

Business Valuation More Art Than Science Business Valuation More Art Than Science One of the more difficult aspects of business planning is business valuation. It is also one of the more important aspects. While owners of closely held businesses

More information

Table of Contents SECTION 1. Overview... ix. Course Schedule... xiii. Introduction. Part 1. Introduction to the Income Capitalization Approach

Table of Contents SECTION 1. Overview... ix. Course Schedule... xiii. Introduction. Part 1. Introduction to the Income Capitalization Approach Table of Contents Overview... ix Course Schedule... xiii SECTION 1 Introduction Part 1. Introduction to the Income Capitalization Approach Preview Part 1... 1 Market Value... 3 Anticipation and Other Relevant

More information

North Seattle College RES 217 Session 5. Market Feasibility and Financial Analysis

North Seattle College RES 217 Session 5. Market Feasibility and Financial Analysis North Seattle College RES 217 Session 5 Market Feasibility and Financial Analysis Preliminary Analysis Completed Back-of-the-Envelope Analysis (aka, Back-of-the-Napkin) Main advantage to back-of-the envelope

More information

THIS IS THE TITLE OF THE DOCUMENT. What You Should Know About CRE Leases

THIS IS THE TITLE OF THE DOCUMENT. What You Should Know About CRE Leases THIS IS THE TITLE OF THE DOCUMENT What You Should Know About CRE Leases Copyright PropertyMetrics.com All Rights Reserved Feel free to email, tweet, blog, and pass this ebook around the web... but please

More information

ESTIMATING NET OPERATING INCOME (I O )

ESTIMATING NET OPERATING INCOME (I O ) ESTIMATING NET OPERATING INCOME (I O ) S P E C I A L S K I L L S ESTIMATING NET OPERATING INCOME (IO) (STAGE 5) Gross Income (GI) Rental Income Parking Income Other Income Total Possible Income - Vacancy

More information

Advanced M&A and Merger Models Quiz Questions

Advanced M&A and Merger Models Quiz Questions Advanced M&A and Merger Models Quiz Questions Transaction Assumptions and Sources & Uses Purchase Price Allocation & Balance Sheet Combination Combining the Income Statement Revenue, Expense, and CapEx

More information

y y x x infinite cloner

y y x x infinite cloner Learning Target: Practice simplifying algebraic epressions using algebra tiles and an Epression Comparison Mat to determine which of two epressions is greater. Learn how to record their work in order to

More information

How to Read a Real Estate Appraisal Report

How to Read a Real Estate Appraisal Report How to Read a Real Estate Appraisal Report Much of the private, corporate and public wealth of the world consists of real estate. The magnitude of this fundamental resource creates a need for informed

More information

Trulia s Rent vs. Buy Report: Full Methodology

Trulia s Rent vs. Buy Report: Full Methodology Trulia s Rent vs. Buy Report: Full Methodology This document explains Trulia s Rent versus Buy methodology, which involves 5 steps: 1. Use estimates of median rents and for-sale prices based on an area

More information

Building value on a rental property It s all about the NOI.

Building value on a rental property It s all about the NOI. Building value on a rental property It s all about the NOI. Dino Nicosia, Broker of Record, Investpro Realty Ltd., Brokerage The real estate market is divided into many submarkets, such as commercial,

More information

Finding an Apartment LESSON 4. Choosing an Apartment

Finding an Apartment LESSON 4. Choosing an Apartment Finding an Apartment LESSON 4 Someday you will be on your own with a full-time job and ready to live independently from your parents. Choosing an apartment is an exciting step in your life, but you must

More information

Following is an example of an income and expense benchmark worksheet:

Following is an example of an income and expense benchmark worksheet: After analyzing income and expense information and establishing typical rents and expenses, apply benchmarks and base standards to the reappraisal area. Following is an example of an income and expense

More information

Cheat Sheet 3 Formulas to Know When Investing in Multi-Family Homes

Cheat Sheet 3 Formulas to Know When Investing in Multi-Family Homes Cheat Sheet 3 Formulas to Know When Investing in Multi-Family Homes Overview There are many factors that go into buying a property size, location, finishes the list goes on and on. When searching for a

More information

MARCH GUIDE TO BUILDING CONDITION ASSESSMENTS and RESERVE FUND STUDIES

MARCH GUIDE TO BUILDING CONDITION ASSESSMENTS and RESERVE FUND STUDIES MARCH 2018 GUIDE TO BUILDING CONDITION ASSESSMENTS and RESERVE FUND STUDIES Contents What This Guide Covers... 3 Why Your Co-op Needs a BCA and RFS... 3 The BCA and RFS... 4 What is a building condition

More information

Raising Your Commercial IQ

Raising Your Commercial IQ Raising Your Commercial IQ Real Estate Investment & Lease Analysis January 2013 0 P age Neil Osborne M.B.A. DL. (604) 988-5518 nosborne@investitsoftware.com Investit Software Inc. Toll free 877-878-1828

More information

INTRODUCTION TO FEDERAL LOW INCOME HOUSING TAX CREDITS. 1. Applicable Percentage

INTRODUCTION TO FEDERAL LOW INCOME HOUSING TAX CREDITS. 1. Applicable Percentage INTRODUCTION TO FEDERAL LOW INCOME HOUSING TAX CREDITS I. THE TAX CREDIT GENERALLY a. Established under the Tax Reform Act of 1986. Essentially an effort to partially privatize the affordable housing industry.

More information

Name: Date: Problem Set: Find the value of these expressions for the specified replacements of a, b, and c.

Name: Date: Problem Set: Find the value of these expressions for the specified replacements of a, b, and c. Rational Epressions KEY Module: Objective: Evaluating Rational Epressions To practice evaluating a rational epression for a given set of values Name: Date: Fill in the blanks. Use one of the words in parentheses

More information

Sales Associate Course

Sales Associate Course Sales Associate Course Chapter Sixteen Appraisal 1 2 Appraiser Specific amount Impartial (non biased) Defendable Estimate (Opinion) of value Fee based on time and difficulty Must follow Uniform Standards

More information

Typical Valuation Approaches and How to Deal With Them

Typical Valuation Approaches and How to Deal With Them Typical Valuation Approaches and How to Deal With Them January, 2018 Anthony F. DellaPelle, Esq., CRE Shareholder, McKirdy, Riskin, Olson & DellaPelle, P.C. Morristown, New Jersey Christian F. Torgrimson,

More information

The Knowledge Resource. First-Time Home Buyers FOR. Your Agent Is the Best Guide Save Time, Money, and Frustration

The Knowledge Resource. First-Time Home Buyers FOR. Your Agent Is the Best Guide Save Time, Money, and Frustration K N O W L E D G E I S P O W E R The Knowledge Resource FOR First-Time Home Buyers Your Agent Is the Best Guide Save Time, Money, and Frustration The Keys to Homeownership Unlock the American Dream Is Buying

More information

Audio #26 NRAS NRAS

Audio #26 NRAS NRAS NRAS Dymphna: Welcome everybody to iloverealestate.tv. Great to have you guys listening again and once again, I have a fabulous guest speaker to come and talk to you. Now we re talking about something

More information

Bridge Financing & Valuation Trends Amid a Changing CRE Landscape ARBOR.COM 800.ARBOR.10

Bridge Financing & Valuation Trends Amid a Changing CRE Landscape ARBOR.COM 800.ARBOR.10 Bridge Financing & Valuation Trends Amid a Changing CRE Landscape ARBOR.COM 800.ARBOR.10 Today s Speakers Gianni Ottaviano Senior Vice President, Structured Finance Production, Arbor Realty Trust, Inc.

More information

5 Secrets to Maximizing the Most Overlooked Goldmine in Today s Real Estate Market

5 Secrets to Maximizing the Most Overlooked Goldmine in Today s Real Estate Market 5 Secrets to Maximizing the Most Overlooked Goldmine in Today s Real Estate Market By: Stacy Kennedy, CPA I m very excited to share with you a secret that I ve uncovered over the past several years of

More information

10 Tips for Real Estate Investors

10 Tips for Real Estate Investors 10 Tips for Real Estate Investors FINANCIAL ADVISORS TRUSTWORTHY BY DESIGN SM When you buy a home, people often remind you it could be the biggest investment you will ever make. But should you use that

More information

Regression + For Real Estate Professionals with Market Conditions Module

Regression + For Real Estate Professionals with Market Conditions Module USER MANUAL 1 Automated Valuation Technologies, Inc. Regression + For Real Estate Professionals with Market Conditions Module This Regression + software program and this user s manual have been created

More information

WESTERN SPECIALTY CONTRACTORS. Property Inspections. The Critical First Step

WESTERN SPECIALTY CONTRACTORS. Property Inspections. The Critical First Step WESTERN SPECIALTY CONTRACTORS Property Inspections The Critical First Step How to Use a Building Component Inventory to Provide Clients More Value Are you preparing to launch a new or revamped maintenance

More information

The Ultimate Guide To: DC CONDO CONVERSIONS. Authored by the Washington Capital Partners Team

The Ultimate Guide To: DC CONDO CONVERSIONS. Authored by the Washington Capital Partners Team The Ultimate Guide To: DC CONDO CONVERSIONS Authored by the Washington Capital Partners Team So, what is a condo conversion? Added 4th Floor Unit 2 Existing Structure (Floors 1, 2, &3) Unit 1 Washington,

More information

THE APPRAISAL OF REAL ESTATE 3 RD CANADIAN EDITION BUSI 330

THE APPRAISAL OF REAL ESTATE 3 RD CANADIAN EDITION BUSI 330 THE APPRAISAL OF REAL ESTATE 3 RD CANADIAN EDITION BUSI 330 REVIEW NOTES by CHUCK DUNN CHAPTER 20 Copyright 2010 by the Real Estate Division and Chuck Dunn. All rights reserved CHAPTER 20 - THE INCOME

More information

Broker. Investment Real Estate. Chapter 15. Copyright Gold Coast Schools 1

Broker. Investment Real Estate. Chapter 15. Copyright Gold Coast Schools 1 Broker Chapter 15 Investment Real Estate Copyright Gold Coast Schools 1 Learning Objectives Matching an investor with the right property Evaluating the sites and improvements of income properties Determining

More information

HowBad Is. Mark Zoellertakes a common, Commercial Real Estate

HowBad Is. Mark Zoellertakes a common, Commercial Real Estate Commercial Real Estate HowBad Is Mark Zoellertakes a common, often overlooked, problem and offers a path toward a workable solution. In this first of two articles, Zoeller feels that risk analysts are

More information

Ontario Affordable Housing Calculator Users Guide

Ontario Affordable Housing Calculator Users Guide Ontario Affordable Housing Calculator Users Guide There are a number of different ways to get help using the Affordable Housing Calculator. 1. How To Videos A series of videos that walk the user through

More information

GENERAL ASSESSMENT DEFINITIONS

GENERAL ASSESSMENT DEFINITIONS 21st Century Appraisals, Inc. GENERAL ASSESSMENT DEFINITIONS Ad Valorem tax. A tax levied in proportion to the value of the thing(s) being taxed. Exclusive of exemptions, use-value assessment laws, and

More information

Return on Investment Model

Return on Investment Model THOMAS JEFFERSON PLANNING DISTRICT COMMISSION Return on Investment Model Last Updated 7/11/2013 The Thomas Jefferson Planning District Commission developed a Return on Investment model that calculates

More information

JEFFREY SAMUELS. Welcome! Maximize Your Real Estate Value!

JEFFREY SAMUELS. Welcome! Maximize Your Real Estate Value! Welcome! We look forward to speaking with you about the future sale of your home. We are confident you will feel that the programs we outline for you will provide you with the greatest possibility of selling

More information

Retail Properties: Characteristics and Analysis Clifford J. Bogart CCIM. Welcome to Today s Simulcast!

Retail Properties: Characteristics and Analysis Clifford J. Bogart CCIM. Welcome to Today s Simulcast! Welcome to Today s Simulcast! Please Note: Remember to sign in (and don t forget to sign out)! Sit as close to the front as possible in the assigned seating area. Read and sign MetroTex Course Policies

More information

Application for Rent Increase Above the Guideline. A Landlord s Guide

Application for Rent Increase Above the Guideline. A Landlord s Guide Ce document est disponible en français. Composez le 204-945-2476. Application for Rent Increase Above the Guideline A Landlord s Guide This guide will help you fill out your Application for Rent Increase.

More information

Real Estate & REIT Modeling: Quiz Questions Module 1 Accounting, Overview & Key Metrics

Real Estate & REIT Modeling: Quiz Questions Module 1 Accounting, Overview & Key Metrics Real Estate & REIT Modeling: Quiz Questions Module 1 Accounting, Overview & Key Metrics 1. How are REITs different from normal companies? a. Unlike normal companies, REITs are not required to pay income

More information

Fill-in-the-Blank Equations. Exercises

Fill-in-the-Blank Equations. Exercises Chapter 9 Long-Term Assets: Fixed and Intangible Study Guide Solutions 1. Residual value 2. Useful life 3. Straight-line rate 4. Total estimated units of activity 5. Straight-line rate 6. Depletion rate

More information

Investment Guide. home loans

Investment Guide. home loans Investment Guide home loans Your investment journey With the right finance solution, a property investment can build your wealth and improve your financial security. There are hundreds of thousands of

More information

Use of Comparables. Claims Prevention Bulletin [CP-17-E] March 1996

Use of Comparables. Claims Prevention Bulletin [CP-17-E] March 1996 March 1996 The use of comparables arises almost daily for all appraisers. especially those engaged in residential practice, where appraisals are being prepared for mortgage underwriting purposes. That

More information

Solar Open House Toolkit

Solar Open House Toolkit A Solar Open House is an informal meet and greet at a solar homeowner s home. It is an opportunity for homeowners who are considering going solar to see solar in person. They can ask questions about the

More information

Residential Square Footage Guidelines

Residential Square Footage Guidelines Residential Square Footage Guidelines Residential Square Footage Guidelines Introduction It is often said that the three most important factors in making a homebuying decision are "location," "location,"

More information

Home Selling Made Simple

Home Selling Made Simple Home Selling Made Simple Table of Contents Introduction...4 Determining Your Asking Price...5 Should You Sell Solo?...6 Tips On Advertising Your Home For Sale...8 Building Rapport With Homebuyers...10

More information

CABARRUS COUNTY 2016 APPRAISAL MANUAL

CABARRUS COUNTY 2016 APPRAISAL MANUAL STATISTICS AND THE APPRAISAL PROCESS PREFACE Like many of the technical aspects of appraising, such as income valuation, you have to work with and use statistics before you can really begin to understand

More information

Fill-in-the-Blank Equations. Exercises

Fill-in-the-Blank Equations. Exercises Chapter 10 Fixed Assets and Intangible Assets Study Guide Solutions 1. Residual value 2. Useful life 3. Straight-line rate 4. Total units of output 5. Straight-line rate 6. Depletion rate 7. Fixed asset

More information

Before the Minnesota Public Utilities Commission State of Minnesota. Docket No. E002/GR Exhibit (LMC-1) Property Taxes

Before the Minnesota Public Utilities Commission State of Minnesota. Docket No. E002/GR Exhibit (LMC-1) Property Taxes Direct Testimony and Schedules Leanna M. Chapman Before the Minnesota Public Utilities Commission State of Minnesota In the Matter of the Application of Northern States Power Company for Authority to Increase

More information

2011 ASSESSMENT RATIO REPORT

2011 ASSESSMENT RATIO REPORT 2011 Ratio Report SECTION I OVERVIEW 2011 ASSESSMENT RATIO REPORT The Department of Assessments and Taxation appraises real property for the purposes of property taxation. Properties are valued using

More information

Basics of Commercial Real Estate Transactions Day Two

Basics of Commercial Real Estate Transactions Day Two Basics of Commercial Real Estate Transactions Day Two John Rockwell, Partner Energy October 12, 2016 PG&E refers to the Pacific Gas and Electric Company, a subsidiary of PG&E Corporation. 2010 Pacific

More information

BPO Best Practices Guide

BPO Best Practices Guide BPO Best Practices Guide A Step by Step Guide for Completing BPO Reports Version: 1.0.0 Published: 03/01/2011 Global DMS, 1555 Bustard Road, Suite 300, Lansdale, PA 19446 2014, All Rights Reserved. Table

More information

2016 LANDU Course Descriptions. Agricultural Land Brokerage and Marketing

2016 LANDU Course Descriptions. Agricultural Land Brokerage and Marketing 2016 LANDU Course Descriptions Agricultural Land Brokerage and Marketing Gain an understanding of the basics of agricultural land brokerage process s well as insights on how to best market these types

More information

IREDELL COUNTY 2015 APPRAISAL MANUAL

IREDELL COUNTY 2015 APPRAISAL MANUAL STATISTICS AND THE APPRAISAL PROCESS INTRODUCTION Statistics offer a way for the appraiser to qualify many of the heretofore qualitative decisions which he has been forced to use in assigning values. In

More information

AMPLE. math. Real Estate a. what you need to know. seventh edition. Linda L. Crawford

AMPLE. math. Real Estate a. what you need to know. seventh edition. Linda L. Crawford w math L Real Estate a + - i what you need to know seventh edition % x = Linda L. Crawford REAL ESTATE MATH What You Need to Know SEVENTH EDITION Linda L. Crawford This publication is designed to provide

More information

Home Buyer s Guide. Everything you need to know before buying a home

Home Buyer s Guide. Everything you need to know before buying a home Home Buyer s Guide Everything you need to know before buying a home A real estate transaction is one of the biggest financial transactions most people will do in a lifetime. Understanding the buying process

More information

Selected Paper prepared for presentation at the Southern Agricultural Economics Association s Annual Meetings Mobile, Alabama, February 4-7, 2007

Selected Paper prepared for presentation at the Southern Agricultural Economics Association s Annual Meetings Mobile, Alabama, February 4-7, 2007 DYNAMICS OF LAND-USE CHANGE IN NORTH ALABAMA: IMPLICATIONS OF NEW RESIDENTIAL DEVELOPMENT James O. Bukenya Department of Agribusiness, Alabama A&M University P.O. Box 1042 Normal, AL 35762 Telephone: 256-372-5729

More information

National Housing Co-Investment Fund APPLICATION GUIDE FOR FINANCIAL VIABILITY WORKBOOK - NEW CONSTRUCTION

National Housing Co-Investment Fund APPLICATION GUIDE FOR FINANCIAL VIABILITY WORKBOOK - NEW CONSTRUCTION National Housing Co-Investment Fund APPLICATION GUIDE FOR FINANCIAL VIABILITY WORKBOOK - NEW CONSTRUCTION TABLE OF CONTENTS About the Financial Viability Workbook... 3 Rents Affordability (Tab 2)... 3

More information

MULTIFAMILY PROPERTY MANAGERS

MULTIFAMILY PROPERTY MANAGERS Suite TM MULTIFAMILY PROPERTY MANAGERS Move Your Business Forward REAL-TIME INFORMATION TO OPTIMIZE YOUR RENTS AND OCCUPANCIES 3,000 multifamily owners and property management firms use CoStar because

More information

Simplify each expression using addition, subtraction, multiplication, or division.

Simplify each expression using addition, subtraction, multiplication, or division. A rational epression is of the form polynomial ; a fraction of polynomial epressions. polynomial To simplify a rational epression means 1. The answer is in lowest terms ; the numerator and denominator

More information

METROPOLITAN NORTH GEORGIA WATER PLANNING DISTRICT CONSERVATION PRICING GUIDANCE JANUARY 2014

METROPOLITAN NORTH GEORGIA WATER PLANNING DISTRICT CONSERVATION PRICING GUIDANCE JANUARY 2014 INTRODUCTION METROPOLITAN NORTH GEORGIA WATER PLANNING DISTRICT CONSERVATION PRICING GUIDANCE JANUARY 2014 All water systems in the Metropolitan North Georgia Water Planning District (Metro Water District)

More information

Initial sales ratio to determine the current overall level of value. Number of sales vacant and improved, by neighborhood.

Initial sales ratio to determine the current overall level of value. Number of sales vacant and improved, by neighborhood. Introduction The International Association of Assessing Officers (IAAO) defines the market approach: In its broadest use, it might denote any valuation procedure intended to produce an estimate of market

More information

1. 6 RATIOnAl expressions

1. 6 RATIOnAl expressions 58 CHAPTER 1 Prerequisites learning ObjeCTIveS In this section, ou will: Simplif rational epressions. Multipl rational epressions. Divide rational epressions. Add and subtract rational epressions. Simplif

More information

Investit Software Inc. Investor Pro

Investit Software Inc.  Investor Pro Investor Pro Table of Contents Investor Pro...3 Introduction...3 The fastest way to learn Investor Pro...4 Selecting a Template. Which Template should I use?...6 Setting and changing the Starting Date

More information

Sell Your House in DAYS Instead of Months

Sell Your House in DAYS Instead of Months Sell Your House in DAYS Instead of Months No Agents No Fees No Commissions No Hassle Learn the secret of selling your house in days instead of months If you re trying to sell your house, you may not have

More information

Deal Analyzer for Rentals

Deal Analyzer for Rentals for Rentals Preview Of What You Will Learn Sections: Introduction... 6 Section 1: Inputs... 10 Section 2: Core Numbers... 13 Section 3: First-Year Operating Projection... 15 Section 4: Five-Year Operating

More information

by Bill Tinsley & CB Team Ellis & Tinsley, Inc. Commercial & Investment Real Estate What s In This Report?

by Bill Tinsley & CB Team Ellis & Tinsley, Inc. Commercial & Investment Real Estate What s In This Report? by Bill Tinsley & CB Team Ellis & Tinsley, Inc. Commercial & Investment Real Estate 817-737-5000 What s In This Report? The biggest risk in NNN investing and how to avoid it. Metrics that can identify

More information

How to Determine the Value of a Storage Property from Financial Reports. Presented by: Joe Linsalata

How to Determine the Value of a Storage Property from Financial Reports. Presented by: Joe Linsalata How to Determine the Value of a Storage Property from Financial Reports Presented by: Joe Linsalata Building your Proforma Use an Excel spreadsheet or an equivalent Always use formulas, stay away from

More information

ASSESSMENT METHODOLOGY

ASSESSMENT METHODOLOGY 2018 ASSESSMENT METHODOLOGY MULTI-RESIDENTIAL MANUFACTURED HOME PARK A summary of the methods used by the City of Edmonton in determining the value of multi-residential manufactured home park land properties

More information