financial analysis preview - apartment community

8/9/2019 Financial Analysis Preview - Apartment Community

1/12

FinancialAnalysisforManagementPlanPreparedFor:Sample

PreparedBy:myHomeSpot.com

PreparedDate:

Section:Overview

Expenses

2.Theaveragedaysonthemarketforeachunitis30days

3.Latefeeswillincreaseto$1,350permonth

4.Turnoverratioincreasesfrom1.3to1.75

1.Themarketrateforeachunitis$550permonth

FinancialAnalysisOverviewThefollowingassumptionsaremadeinthisanalysis:

1.A15%reductioninvariableexpenses

2.A40%reductioninwaterexpense

3.A25%reductioninpayrollexpense

4.Aloanmodificationisexecuteddecreasingtheinterestrateby50basispoints

5.

A

50%

reduction

in

accounting

expenses

6.Theeliminationoftheexistingmanagementfee(Approximately$2,847permo.)

7.AdditionofmyHomeSpot.com,LLCmanagementfees(Variable,see"Statement Projected"section)

8.Areductionintravelexpenseto$0

Revenues

Analysis"section.

5.Defaultratiodecreasesfrom8%to6%

6.Rateofrentincreasegoesfrom1%to1.5%

SensitivityAnalysis:

Underthebestcasescenarioforecastedrevenueswillbe3%higherandexpenseswillbe3%lowerthanprojected.

Undertheexpectedscenarioforecastedrevenueswillbe0%higherandexpenseswillbe0%lowerthanprojected.

Underthebestcasescenarioforecastedrevenueswillbe3%lowerandexpenseswillbe3%higherthanprojected.

*Sensitivityanalysischangesarenotreflectedinthe"Statement Projected"section. Changesarereflectedinthe"Investment


2/12



PreparedDate:

Section:Investor&PropertyInformation

Name

SampleApartments Purchase

Price 1,300,000$

Selling

Expens

Address 1234PeachtreeSt ClosingCost 12,000$ AnnualRateo

City,StateZip Atlanta,GA30342 OriginalLoanAmount 700,000$ InflationAdju

CurrentManager SelfManaged InitialInvestment 612,000$ DispositionCa

DateofAnalysis 1/1/2010 DateofAcquisition 2/1/2008

OnSiteStaff (YorN) Yes DateofLoanProcurement 2/1/2008

Ifyeslisttitleofstaffbelow: Type(InterestOnlyorAmortized) InterestOnly Reinvestment

StaffMember#1 N/A Rate 7.00% DiscountRate

StaffMember#2 N/A AmortizationPeriod 240

StaffMember#3 N/A Term(Mo.) 120

PropertyStatistics AdditionalLeverage($) 50,000$

DispositGeneralPropertyInformation Acquisition&FinancingInformation

PropertyType GardenStyle Type(InterestOnlyorAmortized) InterestOnly

PropertyAge 1981 DateofLoanProcurement 1/1/2008

NumberofBuildings 8 Rate 9.00%

NumberofUnits 32 AmortizationPeriod 120

ParkingType Lot Term(Mo.) 120

Features&Amenities 1031Exchange(YorN) YPool No OriginalBasis 700,000$

Count: 0 InvestorTaxRate 35%

Tennis No PercentDepreciable 75%

Count: 0 CommercialorResidential Commercial

ClubHouse No

Count: 0

FitnessCenter No

Count: 0

Pond/WaterFeature No

Count: 0


3/12



PreparedDate:

Section:Revenues

UnitType Rent

Rate #

in

Community %

of

Total Parking

Income $

1Bed1Bath 500$ 7 29.2% Latecharges 325$

2Bed1Bath 575$ 9 37.5% DepositForfeit $

2Bed2Bath 600$ 4 16.7% Application 75$

3Bed2Bath 650$ 4 16.7% UtilityContracts $

N/A $ 0 0.0% Other $

N/A $ 0 0.0% Other $

N/A $ 0 0.0% Total 400$N/A $ 0 0.0%

N/A $ 0 0.0%

N/A $ 0 0.0% DefaultRatio(Yr.)

Totals 569.79$ 24 100.0% AverageTenantTenure(Yrs.) TotalUnits

TotalPotentialRent 18,325$

UnitType RentRate #inCommunity %ofTotal CurrentGrossCollectedRent 13,675$

1Bed1Bath 500$ 2 25.0% CurrentVacancyRate 2

UnitStatistics

OccupiedUnitInformation

VacantUnitInformation

AdditionalSourcesofRev.(mo.

2Bed1Bath 575$ 2 25.0% CurrentVacancy(Economic) 2

2Bed2Bath 600$ 2 25.0% AverageRentRate $

3Bed2Bath 650$ 2 25.0% %Rev(NonRentSources)

N/A $ 0 0.0%

N/A $ 0 0.0%

N/A $ 0 0.0%

N/A $ 0 0.0%

N/A $ 0 0.0%

N/A $ 0 0.0%

Totals 581.25$ 8 100.0%


4/12



PreparedDate:

Section:Expenses

Category Quantity

PrimaryNotePayment 4,083$ OperationalMgmt 7% Refrigerators

SecondNote 375$ LeasingMgmt 75% Stoves

RenewalMgmt 25% HVAC

PropertyTaxes 1,000$ Carpeting

Assessments/Fees 100$ N/A $ Roof(SF) 10,0

N/A $ ParkingArea(SF) 17,0

PropertyInsurance 750$ N/A $ WaterHeaters

Advertising 50$ ExteriorPaint

Legal 220$

Pool

$

Pool

Accounting 350$ Tennis $ FitnessEquipment

ExpenseInformation ReFinance Management

Operating

Government

CAM

Personnel

Utilities 115$ ClubHouse $ Other

Maintenance&Repairs 1,100$ FitnessCenter $ Other

Turnover(PerUnit) Pond/WaterFeature $ TotalReservePaint 400.00$ Contingency

Cleaning 50.00$ ReserveAccount 1,153.74$ AdjustedTotalCarpetClean 35.00$

Misc.#1 $

Reserves

Misc.


5/12



PreparedDate:

Section:Projections

Adjustment Adjustment TotalLoans

O

PrimaryNotePayment 4,083$ 4,078$ OperationalMgmt 7% 7% NewLoanAm

SecondNote 375$ 530$ LeasingMgmt 75% 75% RefinanceDat

NetChange: 150$ RenewalMgmt 25% 25% InterestOnlyNetChange: N/A Rate

PropertyTaxes 1,000$ 1,000$ Amortization

SpecialAssessments 100$ 100$ N/A $ $ Term(Mo.)

NetChange: $ N/A $ $ Cost Operating N/A $ $ AdditionalLev

PropertyInsurance 750$ 700$ NetChange: $ InterestOnly

Personnel

Management:

AdjExpenseInformationFinance

Government

A vertising

50

50

Rate

Legal 220$ 220$ Pool $ $ RefinanceDat

Accounting 350$ 350$ Tennis $ $ Amortization

Utilities 115$ 115$ ClubHouse $ $ Term(Mo.)

Maintenance&Repairs 1,100$ 1,000$ FitnessCenter $ $ Cost

NetChange: (150)$ Pond/WaterFeature $ $Turnover NetChange: $

Paint(perUnit) 400.00$ 375.00$ ParkingIncom

Cleaning(perUnit) 50.00$ 45.00$ Total 1,153.74$ 1,153.74$ Latecharges

CarpetClean(perUnit) 35.00$ 35.00$ DepositForfe

NetChange: (30.00)$ Misc.#1 $ ApplicationCapImprovement&Refi 9,649$ UtilityContrac

Other

Other

Misc.

CAM

Reserves

Adjus


6/12



PreparedDate:

Section:Projections

ExpenseInformationFinance Adjustment Management: Adjustment

PrimaryNotePayment 4,083$ 4,078$ OperationalMgmt 7% 7%

SecondNote 375$ 530$ LeasingMgmt 75% 75%

NetChange: 150$ RenewalMgmt 25% 25%Government NetChange: N/A

PropertyTaxes 1,000$ 1,000$ Personnel

SpecialAssessments 100$ 100$ N/A $ $

NetChange: $ N/A $ $Operating N/A $ $

PropertyInsurance 750$ 700$ NetChange: $Advertising

50$

50$

CAM

Legal 220$ 220$ Pool $ $

Accounting 350$ 350$ Tennis $ $

Utilities 115$ 115$ ClubHouse $ $

Maintenance&Repairs 1,100$ 1,000$ FitnessCenter $ $

NetChange: (150)$ Pond/WaterFeature $ $Turnover NetChange: $

Paint(perUnit) 400.00$ 375.00$ Reserves

Cleaning(perUnit) 50.00$ 45.00$ Total 1,153.74$ 1,153.74$

CarpetClean(perUnit) 35.00$ 35.00$ Misc.

NetChange:

(30.00)$

Misc.

#1

$

CapImprovement&Refi 9,649$


7/12



PreparedDate:

Section:Projectionscontinued

AdjustmentstoFinancing PropertyPerformance/RentRateAdjustmentTotal

Loans

Outstanding 724,913$

Current

Potential

NewLoanAmount 724,913$ AverageTenantTenure 1.5 1.8

RefinanceDate 5/1/2009 DefalutRate 5.0% 3%

nterestOnly(YoN) Y Vacancy(Economic) 25.4% 20%

Rate 6.75% StabalizedVacancy(Economic) 89%

AmortizationPeriod 240 RateofRentIncrease 0.00% 0.5%

Term(Mo.) 120 UnitType CurrentRate PotentialRate

Cost 1.0% 1Bed1Bath 500$ 550.00$

AdditionalLeverage($) 50,000$ 2Bed1Bath 575$ 620.00$

nterestOnly(YoN) n 2Bed2Bath 600$ 640.00$

Rate 5.00% 3Bed

2Bath 650$

685.00$

RefinanceDate 5/1/2009 N/A $

AmortizationPeriod 120 N/A $

Term(Mo.) 120 N/A $

Cost 1.0% N/A $

N/A $

AdjustmenttoAdditionalRev. N/A $ParkingIncome $

Latecharges 325.00$ CapImprovement&AdditionalCostDepositForfeit $ CapImprovement#1 1,000.00$

Application

75.00$

Cap

Improvement

#2 900.00$

UtilityContracts $ CapImprovement#3 $

Other $ CapImprovement#4 $

Other $ CapImprovement#5 $

Total 400.00$ Total 1,900.0$CosttoAdjustFinancing 7,749.1$

AdjustedTotal 9,649.1$


8/12



PreparedDate:

Section:Statement Current

Year1 Year2 Year3 Year4 Year5

RevenuesPotentialRentalIncome 219,900.00$ 219,900.00$ 219,900.00$ 219,900.00$ 219,900.00$

OtherIncome 4,800.00$ 4,800.00$ 4,800.00$ 4,800.00$ 4,800.00$

Vacancy(%ofTotal$) 55,800.00$ 55,800.00$ 55,800.00$ 55,800.00$ 55,800.00$

TenantDefault 8,205$ 8,205$ 8,205$ 8,205$ 8,205$

GrossOperatingIncome 160,695.00$ 160,695.00$ 160,695.00$ 160,695.00$ 160,695.00$Expenses

Government

PropertyTaxes 12,000$ 12,360$ 12,731$ 13,113$ 13,506$

Assessments/Fees 1,200$ 1,236$ 1,273$ 1,311$ 1,351$

Operating

PropertyInsurance 9,000$ 9,270$ 9,548$ 9,835$ 10,130$

Advertising 600$ 618$ 637$ 656$ 675$

Legal 2,640$ 2,719$ 2,801$ 2,885$ 2,971$

Accounting 4,200$ 4,326$ 4,456$ 4,589$ 4,727$

Utilities 1,380$ 1,421$ 1,464$ 1,508$ 1,553$

Maintenance&Repairs 13,200$ 13,596$ 14,004$ 14,424$ 14,857$

Turnover

Paint 6,400$ 6,592$ 6,790$ 6,993$ 7,203$

Cleaning 800$ 824$ 849$ 874$ 900$

Carpet

Clean 560$

577$

594$

612$

630$

Management

Operations 11,487$ 11,487$ 11,487$ 11,487$ 11,487$

Leasing 9,163$ 9,163$ 9,163$ 9,163$ 9,163$

Renewals 1,527$ 1,527$ 1,527$ 1,527$ 1,527$

Personnel

N/A $ $ $ $ $

N/A $ $ $ $ $

N/A $ $ $ $ $

CAM

Pool $ $ $ $ $

Tennis

$

$

$

$

$

ClubHouse $ $ $ $ $

FitnessCenter $ $ $ $ $

Pond/WaterFeature $ $ $ $ $

Misc.

Misc.#1 $ $ $ $ $

TotalOperatingExpense 74,157$ 75,716$ 77,322$ 78,977$ 80,681$NetOperatingIncome 86,538$ 84,979$ 83,373$ 81,718$ 80,014$


9/12



PreparedDate:

Section:Statement CurrentContinued

Less:

1st

Mtg. 49,000$

49,000$

49,000$

49,000$

49,000$

2ndMtg. 4,500$ 4,500$ 4,500$ 4,500$ 4,500$

Less:

ReserveAccount 13,845$ 14,260$ 14,260$ 14,260$ 14,260$

BeforeTaxCashFlow 19,194$ 17,219$ 15,613$ 13,958$ 12,254$Add:

MortgagePrincipal 19,884$ 21,391$ 23,014$ 24,761$ 26,642$

Less:

DepreciationExp. 25,000$ 25,000$ 25,000$ 25,000$ 25,000$

InterestExp. 52,841$ 51,334$ 49,414$ 47,965$ 46,084$

TaxableIncome (38,763)$ (37,724)$ (35,788)$ (34,246)$ (32,188)$TaxLiability(Savings)@

35% (13,567)$ (13,203)$ (12,526)$ (11,986)$ (11,266)$

AfterTaxCashFlow 32,761$ 30,422$ 28,138$ 25,944$ 23,520$


10/12



PreparedDate:

Section:Statement Potential

Year1 Year2 Year3 Year4 Year5

RevenuesPotentialRentalIncome 236,640.00$ 237,823.20$ 239,012.32$ 240,207.38$ 241,408.41$

OtherIncome 4,800.00$ 4,800.00$ 4,800.00$ 4,800.00$ 4,800.00$

Vacancy(%ofTotal$) 189,312.00$ 26,160.55$ 26,291.35$ 26,422.81$ 26,554.93$

TenantDefault 1,420$ 6,350$ 6,382$ 6,414$ 6,446$

GrossOperatingIncome 50,708.16$ 210,112.77$ 211,139.33$ 212,171.03$ 213,207.88$Expenses

Government

PropertyTaxes 12,000$ 12,360$ 12,731$ 13,113$ 13,506$

Assessments/Fees 1,200$ 1,236$ 1,273$ 1,311$ 1,351$

Operating

PropertyInsurance 8,400$ 8,652$ 8,912$ 9,179$ 9,454$

Advertising 600$ 618$ 637$ 656$ 675$

Legal 2,640$ 2,719$ 2,801$ 2,885$ 2,971$

Accounting 4,200$ 4,326$ 4,456$ 4,589$ 4,727$

Utilities 1,380$ 1,421$ 1,464$ 1,508$ 1,553$

Maintenance&Repairs 12,000$ 12,360$ 12,731$ 13,113$ 13,506$

Turnover

Paint 1,333$ 6,111$ 6,295$ 6,484$ 6,678$

Cleaning 160$ 733$ 755$ 778$ 801$

Carpet

Clean 124$

570$

588$

605$

623$

Management

OperationalMgmt 3,313$ 14,816$ 14,890$ 14,965$ 15,040$

LeasingMgmt 8,217$ 8,258$ 8,299$ 8,341$ 8,382$

RenewalMgmt 2,191$ 2,202$ 2,213$ 2,224$ 2,235$

Personnel

N/A $ $ $ $ $

N/A $ $ $ $ $

N/A $ $ $ $ $

CAM

Pool $ $ $ $ $

Tennis

$

$

$

$

$

ClubHouse $ $ $ $ $

FitnessCenter $ $ $ $ $

Pond/WaterFeature $ $ $ $ $

Misc.

Misc.#1 $ $ $ $ $

TotalOperatingExpense 57,758.52$ 76,383.89$ 78,043.50$ 79,749.74$ 81,503.99$NetOperatingIncome (7,050.36)$ 133,728.88$ 133,095.83$ 132,421.29$ 131,703.89$


11/12



PreparedDate:

Section:Statement PotentialContinued

Less:

CapitalImprovements 1,900.00$ $ $ -$ $

Cost

to

Refinance 7,749.13$

$

$ -$

$

Less:

1stMtg. 48,931.66$ 48,931.66$ 48,931.66$ 48,931.66$ 48,931.66$

2ndMtg. 6,363.96$ 6,363.96$ 6,363.96$ 6,363.96$ 6,363.96$

Less:

ReserveAccount 13,844.92$ 13,844.92$ 13,844.92$ 13,844.92$ 13,844.92$

BeforeTaxCashFlow (85,840.03)$ 64,588.35$ 63,955.30$ 63,280.76$ 62,563.36$Add:

MortgagePrincipal 17,754.71$ 18,990.94$ 20,313.24$ 21,727.61$ 23,240.47$

Less:

DepreciationExp. 25,000.00$

25,000.00$

25,000.00$

25,000.00$

25,000.00$

InterestExp. 48,389.05$ 47,152.82$ 45,830.52$ 44,416.15$ 42,903.29$

TaxableIncome (141,474.37)$ 11,426.47$ 13,438.02$ 15,592.22$ 17,900.54$TaxLiability(Savings)@

35% (49,516.03)$ 3,999.26$ 4,703.31$ 5,457.28$ 6,265.19$

AfterTaxCashFlow (36,324.00)$ 60,589.08$ 59,251.99$ 57,823.48$ 56,298.17$


12/12



PreparedDate:

Section:InvestmentAnalysis

AnalysisPeriod (1 5) 4

ProjectedDispositionDate 12/31/2013

SensitivityAnalysis Ratio/MultiplierAnalysis

Revenue Expense Current Potential

%DifferentthanForcasted 0% 0% RatioAnalysis

Debtcoverageratio 1.53 2.

ProjectSummary DefaultRatio 0.82 0.

Current Potential Operatingexpenseratio 0.49 0.

GrossOperatingIncome 160,695.00$ 212,171.03$ Multipliers

TotalOperatingExpense 78,976.53$ 79,749.74$ Grossincomemultiplier 8.09 6.

NetOperatingIncome 81,718.47$ 132,421.29$ Netincomemultiplier 15.91 9.

TotalDebt

Service 53,500.00$

55,295.62$

LoanBalance@Disposition 610,566.42$ 662,903.31$ Valuation

BeforeTaxCashFlow 13,958.20$ 63,280.76$ DirectCapitalizationMethod Current PotentialAfterTaxCashFlow 25,944.39$ 57,823.48$ PropertyCapRate 6.29% 10.19

DispositionSummary Value@DispositionCap 1,021,480.84$ 1,655,266.1$

Current Potential DiscountedCashFlowMethodBTCF@Disposition 380,270$ 942,705$ BeforeTaxNPV (319,570)$ 47,46$

ATCF@Disposition 243,477$ 590,742$ AfterTaxNPV (367,313)$ (141,93$

Rateof

Return

Analysis

Current Potential

Avg.RateofReturn(BTCF) 18.23% 42.84

Avg.RateofReturn(ATCF) 14.74% 29.9

InternalRateofReturn(BTCF) 8.01% 14.04

InternalRateofReturn(ATCF) 13.84% 4.69

CapitalAccumulation

Current Potential

CapitalAccumulated N/A N/A

AnnualGrowth

rate

of

Capital N/A N/A

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