AlexBeasant Hi Alex. thanks for watching. You might check out my All-in-One: www.adventuresincre.com/all-in-one-underwriting-model-for-real-estate-development-and-acquisition/

Gary Smith - Thanks for the comment. While I agree that most purchasers of STNL properties assess value using the direct capitalization method (year one NOI divided by some "market" cap rate), this model values the STNL property using the discounted cash flow method - discounting forecasted cash flows in each period together with a reversion value back to today. I posit, that using the direct capitalization method in valuing STNL properties does not sufficiently price for the lease maturity risk, does not accurately price changes in the asset's value as the quality of the tenant or length of the credit lease term change, nor does it accurately reflect the difference in value between the credit lease cash flows vs speculative lease cash flows. In fact, it was for this very reason that I created the model. To introduce a more detailed method of valuing these types of properties; to bifurcate the two disparate cash flow types, forecast them into the future, and then discount each back at distinct, user-defined discount rates. The result is, I believe, a more accurate reflection of value vs. the basic direct cap on year one NOI. With that said, calculating the imputed cap rate at acquisition is as simple as taking year one NOI and dividing it by the resulting DCF value. This is a metric I've included in the model for reporting and comparison purposes. You can find that on the Valuation tab, cell C9. Thanks again for commenting and please don't hesitate to reach out with any other questions you might have.

Spencer Burton .