How can a developer build a pro forma for a mixed-use project quickly?
Build a mixed-use pro forma quickly by using one development budget and one schedule, with a separate revenue section for each use: residential, retail and office. Each use gets its own market rents, vacancy, lease-up pace and cap rate, and the totals roll up to project NOI, yield on cost, value and returns. Start from your template, not a blank sheet.
Answered
Build a mixed-use pro forma quickly by using one development budget and one schedule, with a separate revenue section for each use: residential, retail and office. Each use gets its own market rents, vacancy, lease-up pace and cap rate, and the totals roll up to project NOI, yield on cost, value and returns. Start from your template, not a blank sheet.
The structure
1. Program: units and square feet by use, parking and common areas.
2. Budget: land, hard costs by use where they differ, soft costs, financing, contingency.
3. Schedule: construction period, then lease-up by use; retail often leases on a different timeline from apartments.
4. Revenue by use: market rents from comps for each use, vacancy, other income.
5. Expenses: by use where possible, with reimbursements for commercial leases.
6. Returns: yield on cost, stabilized value by use, levered and unlevered IRR, equity multiple.
What takes the time
Gathering comps for three different uses and reconciling them is the slow part. So is keeping the budget, the schedule and the revenue in sync when one assumption changes.
Checks before showing it to capital partners
- Retail rents supported by signed leases in the same corridor.
- Separate cap rates by use, or a weighted blend you can explain.
- Sensitivity on the commercial lease-up, which is the usual weak spot.
- Debt sized mostly on the residential income if that is how lenders will see it.
How Titleman helps
Titleman builds the pro forma in your Excel template, pulls comps for each use, keeps every assumption visible and can turn the result into an investor deck with your logo. See how Deal Review works: https://titleman.ai/products/deal-review