Free calculator · Valuation & Returns
Unlevered Property DCF
Values a property from unlevered cash flows, growing NOI and escalating reserves each year and adding a reversion at an exit cap rate net of selling costs, all discounted at the property rate. Inputs include Year 1 NOI and growth, Year 1 reserves and escalation, the discount rate, hold period, exit cap rate, and selling costs.
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Unlevered Property DCF
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Value this property on an unlevered discounted cash flow, holding it for the stated period and selling into the exit cap.
Year 1 NOI is $1,500,000 and grows 3.00% a year. Reserves and capital items run $60,000 in Year 1 and escalate 2.00% a year. The hold is 5 years, the unlevered discount rate is 8.00%, the property sells at a 6.25% exit cap, and costs of sale are 2.0%.
Cash flows arrive at the end of each year, and the sale settles at the end of Year 5.
Present value of the operating cash flows plus the net reversion. Within 1% counts as correct.
After costs of sale, discounted back to today. Within 1% counts as correct.
Year 1 NOI over the value you just derived. This is the comp sanity check. Within 0.10% counts as correct.
Learn the concept
This calculator comes from the free Real Estate Finance course, where the concept is taught with readings, worked examples, and practice questions.
Built by Devon Coombs, CPA, MBA, Teaching Professor of Finance at Santa Clara University.