Learn the fundamentals of Real Estate financial modelling then apply this knowledge to the real world financial modelling challenges in the property development sector.
This course provides a sound understanding of both the principles of real estate financial modelling and the practical application of these to real-world situations through the use of spreadsheets.
The course then builds upon the real estate financial modelling principles and practices learned to apply these to property developments and the financing of these. In this way, participants improve their mastery of real estate investment evaluation principles and concepts, then see how to apply these in practical applications.
Finally, the course describes how to both detect and prevent errors from occurring.
Duration Learning Credits
4 days – 32 hours of 32 PDU’s
Session
Public Classroom Pricing:
Early Bird Price: AUD 3555.00
Regular Price: AUD 3999.00
Instructor-Led Virtual Live Pricing:
Early Bird Price: AUD 2995.00
Regular Price: AUD 3555.00
Private Group/ In-House Learning:
Have a group of 3 or more people?
Register yourself with a special pricing and
request the training exclusively
Day 1: Advanced Excel Workshop
This one-day intensive workshop helps participants to get the most out of the remainder of the course. It covers key, advanced areas of Excel that are relevant to real estate financial modelling and project evaluation.
Here are just some of the areas we cover in our in-depth, hands-on workshop:
● Working with large data sets
● Summarising and aggregating data
● Extracting data that matches criteria using flexible formulas
● Error handling
● Ways of improving structure
● Techniques for keeping formulas consistent yet flexible
● Combining and splitting cells according to the content they contain
● Advanced techniques for creating automatically expanding charts and ranges
● Introduction to macros & when to use these
We then apply and practise these functions during the remainder of the course.
Day 2: Introduction
Brief Introduction to Real Estate Financial Modelling
● What is a financial model?
● What is included in the scope of a financial model?
● What makes a good spreadsheet model?
Principles of Best Practice Real Estate Financial Modelling
● The 7 steps of financial model building
● How to compare and contrast different scenarios
● Best practice guidelines and financial modelling standards
○ Compare and contrast functions, formatting and functionality
● Designing for flexibility and scalability
● Designing for consistency
● Designing for usability and functionality
● Designing checks and balances
○ Best practices for creating and displaying checks and balances
● Using financial modelling standards
○ Compare different financial modelling standards
○ Examples of standards and how to apply these
● Setting up Excel for efficient financial modelling
○ Learn the tips and techniques that will dramatically speed up the creation of your financial models
● Using VBA in financial models
○ When is it appropriate & when is it not appropriate?
○ What things is it best suited for in financial modelling?
Case Study: Modelling with Standards
Identify the key components of a standards-based, real estate financial modelling template
Day 3: Finance and Valuation Concepts
Topics covered include:
● Principles of discounted cash flow (DCF) modelling
● Investment indicators: WACC, NPV, IRR, Payback
● Valuation techniques & considerations
● Escalation factors for revenue, costs and CAPEX
● S-Curve real estate financial modelling for construction costs
● Modelling uncertainty using sensitivity & scenario analysis
● Model optimisation to consider constraints: tools and techniques available
● Presentation and interpretation of results: charts & presentations
● Methods for comparing and selecting projects: key charts & techniques
Case Study Part 1: Model Scoping, Timeline & Structure
Design and scope the model: what should be included/excluded? What are the key outputs & sensitivities? How will the model need to be designed to provide these?
Case Study Part 2: Inputs & Assumptions
How to design and build a model that is flexible, robust, and user-friendly. Learn how to allow for future expansion, change of strategy, different scenarios and sensitivities in a way that allows the user to easily switch between these.
Case Study Part 3: Cash Flow Model
Create a cash flow model for a property development project, building up the model line-by-line.
Day 4: Debt and Finance Modelling
How to model debt finance in property models.
Topics covered include:
● Typical banking covenants and financing arrangements
● Simple debt schedules
● More complex debt waterfalls
● Dealing with fees, interest expense, drawdowns, and interest capitalisation
● Cash sweep
Case Study Part 4: Financing
Extend your model to include debt financing and loan covenants
Case Study Part 5: Investment indicators
Calculate and sense-check the key outputs: charts, investment indicators.
Case Study Part 6: Scenarios & Sensitivities
Identify key risk areas and then incorporate sensitivity factors for these. Build a sophisticated scenario manager to run multiple scenarios and highlight the results.
Control of Financial Models
How to detect and prevent errors from occurring.
Topics covered include:
– Why audit financial models?
– Excel’s auditing tools
– Automated testing tools: role, purpose, limitations, demonstration
– Model documentation
Case Study Part 7: Controls & Checks
Build controls and checks then summarise these so the model’s integrity can be checked and reviewed easily.
● Property Analysts
● Finance Analysts
● Lenders/bankers involved with property
● Property Consultants
● CFOs & Accountants
● Property Investors
● Property Developers
● Property Syndicate Professionals
● Property Managers
● Providers of Public Housing Projects
● Real estate professionals often need to go beyond what pre-built financial models like Estate Master provide. Examples include analysing unique situations, complex deals, or just to ensure they understand the fundamentals of their project’s forecast.
● This course provides an excellent grounding in building financial models for real estate property developments of all kinds. The examples used are primarily from projects where property is acquired, developed, then split-up and sold (although the same principles can be applied to all kinds of real estate financial modelling).
● If you already have some experience in property investment or development, and would like to take your modelling skills to the next level, making your models more flexible, robust and user-friendly, then this is an excellent course for you.
● Extensive worked examples and models are used throughout the course so that participants gain valuable experience in designing solutions to real-world financial modelling challenges in the property sector.