We have included an example of the tool to give you an idea of the information you can capture including; revenue, expenses, bank debt, total equity and annual increases in revenue and expense. You can see from the attached example that by adding in some basic information you can quickly determine the level of potential return on purchase.
In our example a $1,000,000 potential acquisition based on a 10% cap rate (unleveraged year 1 yield) with a bank note of 70% provides a potential pre-tax Internal Rate of Return (the annual return on equity) of 26.73% in the best case scenario and 18.97% in the worst case scenario. In this case the APOD certainly seems to indicate that this building meets my yield threshold and that perhaps I should take the next step and make an offer.
You can use this tool to narrow your choices down to the top one or two that might merit a more in depth evaluation. It is really a time saver and provides solid information based on some of the basic aspects of the buildings operating revenue and expense. This is a tool we use every day and would be happy to use it to assist you in evaluating investment properties. You can reach us at 480-21-1140, or by emailing firstname.lastname@example.org.