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BIWS REIT Projection Reference

This document provides guidance on projecting key financial statements for real estate investment trusts (REITs). It outlines common line items for the income statement, balance sheet, and cash flow statement and describes how to project each line item. For the income statement, revenue is projected based on same-store rent growth and acquisitions/dispositions, while expenses are projected based on property-level details or averages of historical values. The balance sheet is projected by adding/subtracting items to key asset and liability accounts. The cash flow statement projections flow from the income statement and factor in development, acquisitions, dispositions, and financing activities.

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343 views3 pages

BIWS REIT Projection Reference

This document provides guidance on projecting key financial statements for real estate investment trusts (REITs). It outlines common line items for the income statement, balance sheet, and cash flow statement and describes how to project each line item. For the income statement, revenue is projected based on same-store rent growth and acquisitions/dispositions, while expenses are projected based on property-level details or averages of historical values. The balance sheet is projected by adding/subtracting items to key asset and liability accounts. The cash flow statement projections flow from the income statement and factor in development, acquisitions, dispositions, and financing activities.

Uploaded by

Lisa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Real Estate Modeling

Quick Reference – Projecting a REIT’s Financial Statements

http://breakingintowallstreet.com

REIT Income Statement – Common Items: How to Project Income Statement Line Items:

Revenue:
+ Rental Income Same-Store Rent + Development/Redevelopment Rent
+ Miscellaneous Revenue & Fees + Acquisition Rent – Disposition Rent
= Total Revenue Average Previous Years or Hold Constant

Expenses:
– Property-Level Operating Expenses Flows in from Segment Buildup
– Property Taxes Flows in from Segment Buildup
– G&A / Corporate Overhead % Revenue or Average Previous Years
– Amortization of Financing Fees Flows in from Amortization Schedule or Constant
– Stock-Based Compensation % Revenue or Average Previous Years
– Impairment Charge Assume Constant, Average, or $0
– Depreciation Buildings / Useful Life + FF&E / Useful Life
– Net Interest Expense Flows in from Debt Schedule

+ Earnings / (Loss) from Equity Investments Average Previous Years or Hold Constant
+ Gain / (Loss) on Sale of Land Average Previous Years or Hold Constant
= Income from Continuing Operations

Discontinued Operations:
+ Income from Discontinued Operations Flows in from Dispositions Schedule
+ Gain / (Loss) on Sale of Buildings and FF&E Flows in from Dispositions Schedule; Net Sale
Proceeds – Book Value of Assets
= Net Income

– Earnings / (Loss) Attrib. to Noncontrolling Average Previous Years or Hold Constant


= Net Income Attributable to Company
– Preferred Stock Dividends Average Previous Years or Hold Constant
= Net Income to Common

÷ Diluted Shares Outstanding Hold Constant or Use Share Issuances / Repurchases


= Diluted EPS to Common
Real Estate Modeling
Quick Reference – Projecting a REIT’s Financial Statements

http://breakingintowallstreet.com

REIT Balance Sheet – Common Items: How to Project Balance Sheet Line Items:
Assets:
+ Land Net Change to Gross RE Assets * % Land
+ Buildings and Improvements Net Change to Gross RE Assets * % Buildings
+ Furniture, Fixtures & Equipment Net Change to Gross RE Assets * % FF&E
= Gross Real Estate Operating Assets
– Accumulated Depreciation Subtract Total Depreciation on CFS
= Net Operating Real Estate Assets
+ Construction in Progress Flows in from CFS
+ Land Held for Development Flows in from CFS
+ Real Estate Assets Held for Sale Flows in from CFS
= Total Real Estate Assets

+ Cash Flows in from CFS


+ Investments in Equity Interests Add Equity Interest Earnings
+ Capitalized Financing Fees Add Payments on CFS, Subtract Amortization on CFS
+ Accounts Receivable % Revenue
+ Prepaid Expenses & Other Assets % Operating Expenses
= Total Assets

Liabilities:
+ Total Debt, Net of Discounts Add Borrowings and Subtract Repayments
+ Accounts Payable % Operating Expenses
+ Accrued Expenses & Other Liabilities % Operating Expenses
= Total Liabilities

+ Redeeemable Noncontrolling Interests Subtract Redemptions of Redeemable NCI

Shareholders’ Equity (SE):


+ Noncontrolling Interests Add Net Income Attributable to Noncontrolling
+ Preferred Stock Add Issuances; Subtract Redemptions
+ Common Stock & APIC Add Stock Issuances and Stock-Based Compensation
+ Treasury Stock Subtract Stock Repurchases
+ Accumulated Other Comprehensive Income Add Miscellaneous Items and FX Effects
+ Retained Earnings Add Net Income, Subtract Dividends & Distributions
= Total Shareholders’ Equity
Real Estate Modeling
Quick Reference – Projecting a REIT’s Financial Statements

http://breakingintowallstreet.com

REIT Cash Flow Statement – Common Items: How to Project Cash Flow Statement Line Items:
Cash Flow from Operations:
+ Net Income to Common Flows in from Income Statement
+ Depreciation from Continuing Operations Flows in from Income Statement
+ Depreciation from Discontinued Operations Flows in from Dispositions Schedule
+ Amortization of Financing Fees Flows in from Income Statement
+ Stock-Based Compensation Flows in from Income Statement
+ Impairment Charge Flows in from Income Statement
+ Noncontrolling Interest Earnings / (Loss) Flows in from Income Statement
– Equity Interest Earnings / (Loss) Flows in from Income Statement
– Gain / (Loss) on Sale of Real Estate Assets Flows in from IS; Include Land, Buildings, and FF&E
– Increase in Operating Assets / Liabilities Flows in from Balance Sheet
= Cash Flow from Operations (CFO)

Cash Flow from Investing:


– Development & Redevelopment Flows in from Segment Buildup
– Acquisition of Real Estate Assets Flows in from Segment Buildup
– Maintenance Capital Expenditures Flows in from Segment Buildup
+ Proceeds from Sale of RE Assets Flows in from Dispositions Schedule
– Increase / (Decrease) in Constr. in Progress Average Previous Years or Hold Constant
– Increase / (Decrease) in Land Held for Dev. Average Previous Years or Hold Constant
– Increase / (Decrease) in Assets Held for Sale Average Previous Years or Hold Constant
= Cash Flow from Investing (CFI)

Cash Flow from Financing:


+ Issuances / (Repayments) of Debt Flows in from Debt Schedules
+ Common Stock Issued / (Repurchased) Average Previous Years or Hold Constant
+ Preferred Stock Issued / (Redeemed) Average Previous Years or Hold Constant
– Redemption of Noncontrolling Interests Average Previous Years or Hold Constant
– Common Dividends & OP Distributions % FFO, % AFFO, % NOI, or % Taxable Income
= Cash Flow from Financing (CFF)

+ Exchange Rate Effect (FX) Assume $0 or Hold Constant


Net Change in Cash = CFO + CFI + CFF + FX

Ending Cash = Beg. Cash + Net Change in Cash

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