Flipilizer

Buy, Develop, Flip, Real-Estate
Real-estate development pro forma

Purchase Price total price paid to seller

Build Costs direct costs for design and construction

Rent Revenue gross annual rent collected before expenses

/ year

Exit Value property value based on cap rate

IRR annualized return on all equity cash flows

Purchase

Purchase Price: total price paid to seller

Closing Costs

Transfer Tax: real estate transfer tax payable at closing (welcome tax, land transfer tax, property transfer tax, deed transfer tax, conveyance tax, stamp duty)
Land Transfer Tax %: transfer tax as % of purchase price
Tax Adjustment: reimbursement to seller for prepaid property taxes, prorated to closing date
Prorated Tax Months: months of prepaid property tax reimbursed to seller at closing
Inspections: pre-closing inspections: home, appraisal, required inspections
Legal Fees: title and closing legal fees (attorney/notary, title insurance, registrations, etc.)
Miscellaneous: other pre-closing or closing fees
Closing Costs: total costs paid by closing

Mortgage

Down Payment: cash contribution toward purchase price
Down Payment %: down payment as % of purchase price
Borrowed: amount borrowed
Borrowed %: amount borrowed as % of purchase price
Origination Fees: broker commissions, mortgage insurance, appraisal, and other one-time loan origination fees
Origination %: origination fees as % of amount borrowed
Mortgage Cash Down: cash required for mortgage financing
Mortgage Rate: annual mortgage interest rate
Amortization: number of years to pay the mortgage in full (usually 25 or 30 years)
Compounding: how often interest is compounded (e.g., monthly US, semi-annually Canada)
Mortgage Payment: monthly mortgage payment

Property Tax

Lot Assessment: municipal assessment of the land (excluding buildings)
Building Assessment: municipal assessment of the building(s)
Total Assessment: total assessment of the property, including land and building(s)
Yearly Tax: all recurring taxes and fees such as property tax, school tax, water/sewer, waste, etc.
Tax Rate: all taxes and fees as % of the property's assessed value
Property Tax: monthly municipal taxes and fees

Property Expenses

Replacement Cost: estimated cost to rebuild as new (RCN) at current prices
Repairs: average monthly cost of routine minor repairs and maintenance (plumbing/electrical, HVAC, roof patches, pests, paint/drywall touch-ups, filters/vents, gutters, battery replacement)
Repairs %: repairs as % of building replacement value
Insurance: monthly insurance premium covering fire, water damage, liability, vandalism and other property-related risks
Insurance %: insurance premium as % of building replacement value
Utilities: monthly electricity, gas, heating/cooling, water, internet, etc.
Services: monthly janitorial/cleaning, snow, landscaping, pest control, superintendent, concierge/door, etc.
Other: other monthly property expenses (condo/HOA fees, security, garbage fees, etc.)
Property Expenses: monthly property expenses

Acquisition Analysis

Acquisition Costs: total one-time acquisition costs
Acquisition Cash: total cash required to acquire the property
Carrying Expenses: monthly non-debt operating expenses (excludes mortgage)
Total Carrying Costs: total monthly cash outflows to carry the property
Avg Principal: average monthly principal repaid throughout the mortgage term
Costs less Principal: monthly carrying costs less average principal repayment

Dimensions

Lot Area: size of lot/land
Footprint: area of the building on the ground
Footprint %: ratio of lot size to building footprint
Gross Area: total gross floor area (GFA) across all floors
Num. Floors: number of floors the building occupies
Net Area: net usable floor area excluding shared/common spaces
Net Area %: net area as % of gross area (GFA)
Num. Units: total rentable units
Avg. Unit Size: average size of each unit

Direct Build Costs

Design: space planning, layouts, materials, interiors; exclude if covered by architecture
Design per Area: cost of design per gross area (GFA)
Architecture: architectural drawings and permitting; coordinate consultants; municipal interface
Architecture/Area: cost of architecture per gross area (GFA)
Consultants: environmental (ESA), geotechnical, civil, structural, MEP, energy modeling, code, acoustic, landscape, fire safety
Consultants/Area: cost of consultants per gross area (GFA)
Professional: legal, accounting, bookkeeping, contract review, dispute resolution, regulatory compliance
Professionals/Area: cost of legal and professional services per gross area (GFA)
Municipal Fees: Misc. taxes (e.g. parks tax), permits for construction and demolition, inspections, infrastructure contributions (sidewalks, sewer, utility upgrades), tree protection, etc.
Municipal Fees/Area: municipal fees per gross area (GFA)
Demolition: major structural demolition for ground-up development, decontamination, excavation, grading, temporary fencing and site preparation
Demolition per Area: cost of demolition per gross area (GFA)
Structure: foundation, framing, roof, exterior walls, windows, doors, insulation, plumbing, electrical, HVAC, fire systems, drywall
Structure per Area: cost of structure per gross area (GFA)
Interior: flooring, stairs, doors/trim, paint/wallcovering, millwork, counters, fixtures, appliances, lighting, window treatments
Interior per Area: cost of interior per gross area (GFA)
Landscaping: cost of driveway, pathways, gazebos, decks, terraces, sheds, pools, awnings, trees, plants, outdoor lighting
Landscaping per Area: cost of landscaping per gross area (GFA), not area of land being landscaped
General Contractor: general contractor (GC) oversight, including scheduling, trades, budgeting, and site supervision
GC per Area: cost of general contractor per gross area (GFA)
Build Costs: direct costs for design and construction
Reno Costs per Area: direct build cost per gross area (GFA)

Build Duration

Planning: months to complete full construction drawings for permit submission
Permitting: months to complete permitting, approvals, and general contractor (GC) selection
Soft Duration: total months to complete planning and permitting before construction
Construction: months to complete hard construction such as demolition, structure, interiors, landscaping
Hard Duration: total months to complete hard construction
Build Duration: total months to complete improvements

Construction Operating Expenses

Builder's Insurance: builder's insurance (course-of-construction insurance), to insure structures and materials from theft or damage during construction
Insurance %: builder's insurance premium as a % of hard costs
Utilities: total cost of utilities needed for construction: electricity, heating/cooling, water, internet, phone, connection/disconnection, etc.
Security: total cost of securing the construction site: surveillance cameras, motion lights, fencing, personnel, etc.
Other: miscellaneous jobsite costs: signage, portable toilets, pre-sale, snow removal, etc.
Operating Expenses: total operating expenses

Hard Build Costs

Direct Hard Costs: demolition, structure, interior, landscaping, general contractor (GC)
Contingency: buffer for unexpected hard cost overruns
Hard Contingency %: contingency as a % of hard costs
Hard Costs: total hard costs
Hard Costs per Area: total hard costs per gross area (GFA)

Soft Build Costs

Direct Soft Costs: design, architecture, permitting, consultants, legal, accounting, municipal fees
Carrying Costs: total carrying costs including mortgage payment, property taxes, insurance, repairs, fees, etc.
Soft Before Cont.: total soft costs before contingency
Contingency: buffer for unexpected soft cost overruns
Soft Contingency %: contingency as a % of soft costs
Soft Costs: total soft costs before financing
Soft Costs per Area: total soft costs per gross area (GFA)

Total Build Costs

Total Build Costs: all soft and hard costs required to improve the property, excluding financing
Build Costs per Area: total build costs per gross area (GFA)
Soft Costs %: soft costs as a percentage of total build costs
Hard Costs %: hard costs as a percentage of total build costs

Stabilization Costs

Duration: total months to achieve lender-approved stabilization for conversion to permanent mortgage
Base Expenses: total regular rental operating expenses accrued over the stabilization period
Occupancy Tax: one-time taxes/fees due before occupancy (e.g. occupancy/permit fees), GST/HST/QST, "self-supply" tax, VAT
Occupancy Tax %: occupancy tax rate as % of post-construction assessed value
Excess Leasing: extra leasing expenses incurred to achieve full occupancy (agents, marketing, etc.)
Excess Leasing %: excess leasing as a % of gross rent revenue
Excess Vacancy: shortfall in operating costs due to excess vacancy
Vacancy %: excess vacancy as a % of gross rent revenue
Temporary Utilities: utilities temporarily covered until tenant transfer
Legal & Other: other leasing-related expenses (management setup, legal fees, furnishings, etc.)
Stabilization Costs: total leasing and stabilization costs including occupancy-related taxes/fees

Developer Fee

Build & Stabilize: total cost to build and stabilize the development
Developer Fee: fee to manage and execute the development
Developer Fee %: developer fee as % of total build and stabilization costs

Development Costs Before Financing

Development Duration: total number of months to complete the development
Development Duration: total number of years to complete the development
Equity Invested: equity contributed prior to the construction loan (e.g., acquisition, predevelopment, soft costs, and other upfront expenses)
Rental Expenses: total annual operating, management and tax expenses
Development Costs: all development costs excluding financing (land acquisition, improvement, stabilization, and stabilization)

Construction Loan

Loan Duration: total months to build and stabilize the property
Development: total years to build and stabilize the property
Max LTC: maximum allowable loan to cost ratio (LTC)
Min DCR: minimum required debt coverage ratio (ratio of forward NOI to annual debt payments)
Interest Rate: yearly interest rate charged on the construction loan
Capitalized Interest: total interest accrued over the loan term and capitalized into the loan balance
Origination %: origination fees as % of amount borrowed
Origination Fees: broker commissions, mortgage insurance, appraisal, and other one-time loan origination fees
Borrowed: amount borrowed
Equity Required: total equity required
Actual LTC: actual loan to cost ratio after taking into account DCR constraints
Actual DCR: actual debt coverage ratio after taking into account LTC constraints
Financing Costs: total interest and fees accrued over the full term of the construction loan

Improvement

Loan Injection: additional equity required to achieve target LTC
TDC: total development cost including financing
Cash Required: total cash required to complete the development
Development Cash %: total cash required as % of total development cost

Rent Revenue

Avg. Rent per Area: average monthly rent per net area
Avg. Rent per Unit: average monthly rent per unit
Rent Revenue: gross annual rent collected before expenses
Vacancy & Loss: annualized cost of vacancy and credit loss
Vacancy Rate: annual average rate of vacancy and credit loss as % of gross rent revenue
EGI: effective gross income after vacancy and credit loss

New Property Taxes

Lot Assessment: estimated land assessment after improvements
Building Assessment: estimated building(s) assessment after improvements
Total Assessment: total estimated municipal assessment after improvements
Tax Rate: annual property tax rate after improvements
New Property Tax: annual property tax after improvements

Rental Operating Expenses

Replacement Cost: estimated cost to rebuild the renovated building as new (RCN) at current prices
Insurance: annual insurance premium covering fire, water damage, liability, vandalism and other property-related risks
Insurance %: insurance premium as % of building replacement value
Repairs: average annual cost of routine minor repairs and maintenance (plumbing/electrical, HVAC, roof patches, pests, paint/drywall touch-ups, filters/vents, gutters, battery replacement)
Repairs %: repairs as % of building replacement value
Appliances: appliance replacement reserve (e.g., CMHC: $60 per appliance per unit annually)
Utilities: annual electricity, gas, heating/cooling, water, internet, etc. paid by owner (not tenants)
Services: annual janitorial/cleaning, snow, landscaping, pest control, superintendent, concierge/door, etc.
Other: other owner-paid annual expenses (not tenant-billed)
Operating Expenses: annual building operating expenses

Rental Management Expenses

Management Fee: annual fee for rent collection, tenant relations, maintenance coordination, reporting, basic accounting
Management Fee %: annual management fee as % of EGI
Leasing: annual costs for agent commissions, tenant placement, advertising, listing services, signage, etc.
Leasing %: leasing costs as % of EGI
Professional: annual expenses for accounting, bookkeeping, legal, administration
Other: other annual management expenses (e.g., compliance fees and licences, audit fees, banking fees, office supplies, software, etc.)
Management Expenses: annual property management and compliance costs

Net Operating Income

Recurring Expenses: total annual operating, management and tax expenses
Expense %: expenses as a % of EGI
NOI: annual net operating income after taxes and expenses
CapEx per Unit: annual reserve contribution per unit for future capital replacements
CapEx Reserve: annual reserve contribution for future capital replacements
NOI after CapEx: net income after deducting capital replacement reserve contributions

Market Value

Revenue Growth: assumed annual growth rate of rental revenues
Expense Growth: assumed annual growth rate of operating expenses
Forward NOI: projected net operating income after reserves for the next 12 months of operations
Cap Rate: capitalization rate applied to forward NOI after reserves to determine market value
Market Value: property value based on cap rate

Permanent Mortgage

Max LTV: maximum allowable loan to value ratio (LTV)
Min DCR: minimum required debt coverage ratio (ratio of forward NOI to annual debt payments)
Mortgage Rate: annual mortgage interest rate
Amortization: number of years to pay the mortgage in full (usually 25 or 30 years)
Compounding: how often interest is compounded (e.g., monthly US, semi-annually Canada)
Origination Fees: broker commissions, mortgage insurance, appraisal, and other one-time loan origination fees
Origination %: percent of amount borrowed that will be charged as a fee
Actual LTV: actual loan to value ratio after taking into account DCR constraints
Actual DCR: actual debt coverage ratio after taking into account LTV constraints
Borrowed: amount borrowed
Equity Required: total equity required
Mortgage Payment: monthly mortgage payment
Mortgage Payment: annual debt service on the long-term mortgage after stabilization

Operate

Cash Flow After Debt: net operating cash available after debt service obligations
Equity Returned: portion of investor equity repaid using proceeds from the permanent mortgage
CFAD: cash available for distribution after all expenses, fees, debt service, and reserves

Asset Management Fee

Asset Management Fee: annual fee paid to the sponsor for overseeing the property's performance
Asset Mgmt. Fee %: asset management fee as % of EGI

Exit Value

Hold Duration: number of years the property will be operated prior to sale
Ending NOI: projected net operating income after reserves for the 12 months following hold period
Cap Rate: capitalization rate applied to forward NOI after reserves to determine exit value
Exit Value: property value based on cap rate

Sales Costs

Light Renovations: minor renovations, touch-ups, or repairs to enhance market value
Marketing: marketing expenses not covered by broker commission (staging, furnishings, photography, video, signage, pre-sale events, etc.)
Legal: legal documentation and closing prep (disclosures, purchase agreements, certificate of location (CoL), etc.)
Other: miscellaneous upfront sale expenses (service disconnections, tenant buyouts, compliance, etc.)
Sales Costs: up-front sales costs paid prior to closing

Closing Costs

Broker Commission: broker/agent commission due at closing
Broker Commission %: broker/agent commission as % of sale price
Legal: complex deals may require additional legal work at closing not covered by the buyer
Other: utilities, municipal, tax adjustments, etc.
Closing Costs: total closing costs deducted from sale proceeds

Exit Fee

Exit Fee: one-time fee paid to the sponsor upon sale of the property
Exit Fee %: disposition fee as % of exit value

Mortgage Balance Repayment

Mortgage Balance: outstanding loan principal balance to be repaid at closing
Prepayment Penalty: penalty charged for early repayment of the mortgage
Prepayment Penalty %: prepayment penalty expressed as a percentage of the remaining loan balance
Discharge Fees: lender admin, registry/notary, CMHC release, and any prepayment penalties to retire or transfer the loan at sale
Mortgage Repayment: mortgage balance repayment at closing, including fees

Liquidate

Liquidation Costs: total costs of selling the property
Net Sale Proceeds: net proceeds from sale after costs and mortgage repayment
CapEx Reserve: unused capital expenditure reserve balance at time of sale
CapEx Return: unused capex reserve returned to seller
CapEx Return %: capex return as % of capex reserve
Net Cash to Equity: total cash available to equity at closing after sale proceeds and reserve return

Performance

Project Months: total months from acquisition to exit
Investment Lifecycle: total duration of the investment
Operating Distrib.: cash returned to investors throughout operations
Total Cash to Equity: total cash returned to investors
Equity Invested: total cash invested
Net Profit: net return on cash invested
Equity Multiple: multiple of invested cash returned
IRR: annualized return on all equity cash flows