Underwriting & Valuation

A full underwriting worksheet, not a pile of one-line calculators. Enter NOI and a cap rate to value the income; add the loan to size it against LTV, DSCR and debt yield; add equity for cash-on-cash, a ten-year projection and IRR. Every figure updates as you type and carries its own definition — no cross-referencing a glossary. The sheet starts blank: nothing is filled in until you enter it.

Load figures from a property The sheet starts blank — type your own figures, or load a property to fill them from its records.

1 Income

NOI ($/yr)

Effective gross income Operating expenses

Gross potential income Rentable area (SF)

Leave NOI blank to derive it from EGI minus operating expenses.

2 Value

Cap rate (%)

3 Debt

Loan balance ($)

Interest rate (%) Amortization (years)

4 Equity & hold

Equity invested ($)

Hold period (years) NOI growth (%/yr)

Exit cap rate (%) Selling costs (%)

Exit cap at or above the going-in cap is the conservative case.

Enter NOI (or EGI and operating expenses) to begin.

Value

Net operating income — Effective gross income minus operating expenses — income before financing and capital costs. Excludes debt service, capex and depreciation

Property value — NOI ÷ cap rate — what this income is worth at the market's required yield. 50 bps of cap rate moves value roughly 8%

Value per square foot — Value ÷ rentable area — the sanity check against comparable sales. Compare with recent trades nearby

NOI margin — NOI ÷ effective gross income — operating efficiency, comparable across properties. Higher in NNN structures than gross

Debt

Monthly payment — Level payment that fully amortizes the loan over the term entered. A rate is required — never computed at 0%

Annual debt service — Twelve monthly payments — the number DSCR and cash flow are built on.

Loan-to-value — Loan ÷ value — the collateral cushion. It inherits every argument about value. Typically 55–70% on stabilized assets

Debt service coverage — NOI ÷ annual debt service — the lender's cash-flow safety margin. Lenders commonly require 1.20–1.35×

Debt yield — NOI ÷ loan — the lender's return if they owned it tomorrow. Ignores value and rate. Minimums often 8–10%

Loan constant — Annual debt service ÷ loan — total debt burden in one comparable number. Above the asset yield means negative leverage

Loan sizing — the binding constraint

Lenders size to the smallest of the three tests. Shown at common thresholds; adjust the rate and amortization above to see which one binds.

At 1.25× DSCR	—
At 65% LTV	—
At 9% debt yield	—
Indicated maximum loan	—

Equity returns

Cash flow before tax — NOI minus annual debt service — what reaches the equity each year. Before capital items and reserves

Cash-on-cash return — Annual cash flow ÷ equity invested — the current yield on your check. Ignores time; pair it with IRR

Levered IRR — The discount rate where the projected cash flows and sale proceeds net to zero. Highly sensitive to the exit cap rate

Equity multiple — Total distributions ÷ equity invested — how many times the money comes back. Time-blind by design

Break-even occupancy — (Operating expenses + debt service) ÷ gross potential income — where cash flow hits zero. Lower means more cushion

Equity invested — Your own capital. Defaults to value minus the loan when left blank.

Value sensitivity cap rate versus NOI

The two assumptions that move value most, flexed together. Rows are cap rate (±50 bps); columns are NOI (±10%). Your base case is highlighted.

Cap rate

Ten-year cash flow

NOI grown at your assumption, less debt service, with the sale in the final year: year-11 NOI capitalized at the exit cap, less selling costs and the outstanding loan balance.

Year	NOI	Debt service	Cash flow	Sale proceeds	Total

Amortization

Interest and principal by year on the loan entered — the schedule a lender would produce.

Year	Payments	Interest	Principal	Ending balance

Formula reference

Every metric on this page, its formula, what it tells you and where the market usually sits.

Metric	Formula	What it tells you	Typical range / note
Net operating income (NOI)	Effective gross income − operating expenses	The property's income before financing and capital costs.	Excludes debt service, capex, depreciation
Property value (direct cap)	NOI ÷ cap rate	What the income is worth at the market's required yield.	50 bps of cap moves value ~8%
Cap rate	NOI ÷ value	The market's current-yield requirement for this income.	Varies by type, quality and market
Value per square foot	Value ÷ rentable area	A sanity check against comparable sales.	Compare to recent trades
Monthly payment	P × r ÷ (1 − (1+r)^−n), r = monthly rate	Level payment that fully amortizes the loan.	Requires a rate — never 0%
Loan constant	Annual debt service ÷ loan amount	Total debt burden in one number, comparable across structures.	Above the asset yield = negative leverage
Loan-to-value (LTV)	Loan ÷ value	Collateral cushion; inherits every argument about value.	Typically 55–70% on stabilized assets
Debt service coverage (DSCR)	NOI ÷ annual debt service	Cash-flow safety margin for the lender.	Lenders commonly require 1.20–1.35×
Debt yield	NOI ÷ loan	Lender's return if they owned it tomorrow — value- and rate-free.	Minimums often 8–10%
Cash flow before tax	NOI − annual debt service	What reaches the equity each year.	Before capital and reserves
Cash-on-cash return	Annual cash flow ÷ equity invested	Current yield on the equity check; ignores time.	Pair with IRR
Break-even occupancy	(Operating expenses + debt service) ÷ gross potential income	Occupancy at which cash flow reaches zero.	Lower = more cushion
NOI margin	NOI ÷ effective gross income	Operating efficiency, comparable across properties.	Structure-dependent (NNN vs gross)
IRR	Discount rate where NPV of the cash flows = 0	Time-weighted return across the whole hold.	Sensitive to the exit assumption
Equity multiple	Total distributions ÷ total equity invested	How many times the money comes back; time-blind.	Read alongside IRR
Exit value	Year-(N+1) NOI ÷ exit cap rate, less selling costs	Reversion proceeds before repaying the loan balance.	Exit cap at or above going-in is the conservative case

All figures are computed from the values you enter and are analytical aids, not an appraisal, a loan commitment or investment advice. Verify against source documents and your lender's own sizing before acting.