Investment Analyst Worksheet




The Expert is in the Software

The Analyst Worksheet The Worksheet is where all data is entered regarding financing, yield requirements, growth rates, and costs associated with the investment. Both the capitalization rate and internal rate of return are calculated on this screen. While maintaining the friendly user interface for which Investment Analyst is noted, many additional informational iterms were added to the Worksheet in December of 2006. Key numbers, a Summary Tab, and a Review Tab have been added to give you a better picture of your analysis, all on one screen.

Worksheet - New Features

Summary Tab The Summary Tab presents helpful information that will assist you as you work through an income analysis. The information is in "real time." When you change any field in your analysis, the effects are immediately shown on this tab. An explanation of each item is presented below. Two informational iterms that are been added are worthy of note. IRR with NO financing Despite advanced calculation tools like Investment Analyst, it is still a common practice discount Net Income, rather that cash flows. Whether you use financing in your analysis at all is up to you as the analyst. A strong argument can be made for using financing when typical buyers of the property consider financing costs and availability in their purchase decision. However, less advanced discounted cash flow programs generally do not permit the inclusion of financing. Instead they always discount net income.
We offer this calculation so that you may compare the results of your analysis with an analysis that does not consider financing; i.e., an analysis that discounts Net Income. Band of Investment Equivalent Yield Rate Because the Band of Investment is so commonly referenced in the industry, we display a Band of Investment Equivalent Calculation under the Cap Rate tab of the Analyst Worksheet and reference the BOI Equivalent Yield Rate on the Summary tab. In this calculation we calculate the required equity yield that must be used in the BOI calculation in order to produce the same capitalization rate that Analyst produces. The advantage of Analyst is that it considers all of the factors that comprise the capitalization rate: mortgage payments,equity buildup, Soft costs/Closing costs, changes in value, changes in annual income, and selling expenses when the investment is sold. Most importantly, in Analyst you can specify a true Required IRR that can be compared to other investment vehicles - bonds, stocks, savings accounts, annuities, etc.
Review Tab This information is provided to assist in the review of your analysis. When used in conjunction with the Multiyear Income Statement and the Projected Cash Flow Analysis Report, this information will give you a better understanding of your analysis and confidence that you have reviewed the critical data entries that influence the final calculation of value. Among the items that Analyst reviews are Components of Value, the Effect of Financing, and the Terminal Value Calculation. Analyst also looks for unusual income and expense entries, zero entries, and Vacancy Patterns.



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