Real Estate Private Equity Modelling in Excel

On this course, you will:

• Build a Real Estate Private Equity Fund model.
• Understand Private Equity market structure and strategies.
• Understand the basics of Fund Valuation and related metrics.
• Review accounting principles as applied to Real Estate Funds
• Model dividend policy and distributions under various scenarios
• Analyse risk using metrics, tables, and charts.
• Use risk analysis techniques to further define fund structures.

Content

Understanding A Private Equity Fund Model

• Layout and key elements of a PE Model
• Private equity market and strategies
• Understanding the deal structure and interested parties.
• Understanding the capital structure
• Review of the key debt instruments
• Review of the key equity instruments (special case of Management Buyout)

Fund Valuation Methods

• The multiples approach to valuation
• Discounted Cash Flow (DCF), modelling and core concepts.
• Private Equity performance metrics
• Pre-money vs post-money valuation
• Special Cases

Review of Accounting Principles

• Balance Sheet: Real Estate Valuations and Debt
• Profit & Loss: Capital Allowances
• Cash Flow statement: Escrow Accounts and Distributions

Modelling Fund Dynamics, Drivers, and Forecasting

• Forecast of revenue and cost drivers
• Indirect costs and historical ratios in the working capital schedule
• Amortization/Depreciation schedule and capital expenditures
• Debt schedule and the cash available to service the debt.
• Modelling dividend distributions
• Shareholder’s equity schedule and completing the income statement.
• Modelling and Analysing Risk

Performance Analysis

• Benchmarking returns within Real Estate and across industries
• Analyse leverage and coverage ratios
• Calculating Equity Returns Using EBITDA or Net Income
• Deconstructing and using a Return-on-Investment Capital (ROIC) tree.

Training Methodology

The training methodology combines lectures, discussions, group exercises and illustrations. Participants will gain both theoretical and practical knowledge of the topics. The emphasis is on the practical application of the topics and as a result participant will go back to the workplace with both the ability and the confidence to apply the techniques learned to their duties.