Real Estate Pro Forma Example: A Full Deal, Line by Line
Tutorials explain pro formas in the abstract; this article shows one filled out. Below is a complete worked example — a 48-unit value-add apartment acquisition — walked tab by tab through The Multifamily Sheet, with every number on screen traced to the assumption that produced it. By the end you will have seen what a finished, internally consistent pro forma actually looks like: not just the formulas, but the shape of the answers a real deal produces.
Every figure in this deal is illustrative, chosen for a coherent walkthrough — not market data. If you want the concept-by-concept tutorial first, start with how to build a real estate pro forma; if you want the underwriting workflow behind each stage, the multifamily walkthrough is the companion piece. This article is the third leg: the deal itself, line by line.
The Deal at a Glance
"Illustrative Gardens": 48 units, offered at $5,700,000 ($118,750 per door). In-place rents average $1,150; comparable renovated units lease at $1,300. The business plan: renovate 40 units at $12,500 each as leases turn, capture the $150 premium, and hold ten years.
[SCREENSHOT: Dashboard tab — the one-page KPI summary showing going-in cap, NOI, DSCR, projected IRR and equity multiple for the filled-out deal]
The dashboard already shows the finished story — a 6.2% going-in cap, coverage of 1.27x, a levered IRR just under 11% — but numbers on a dashboard are conclusions. The rest of this walkthrough shows where each one comes from.
Tab 1 — Assumptions: Every Input in One Place
[SCREENSHOT: Assumptions tab — purchase price, closing costs, hold period, growth rates, exit cap, financing terms, and waterfall split, with input cells visually distinct]
The assumptions tab holds every number a user chooses: the $5,700,000 price, 2% closing costs, a 10-year hold, rent and expense growth set independently (2.75% and 3.0% here — expenses are deliberately allowed to grow faster), the financing terms, and the exit cap rate. Two entries deserve attention:
- Entry cap 6.2%, exit cap 6.5%. The 30 basis points of assumed expansion is the conservative convention: this deal's returns are not allowed to depend on selling at a richer valuation than we paid.
- Everything downstream references these cells. There is no rent growth number typed inside a formula anywhere in the file — which is what makes the sensitivity tab, later, possible.
Tab 2 — Rent Roll: Where the Thesis Becomes a Number
[SCREENSHOT: Rent Roll tab — unit mix table with in-place vs market rent columns and the GPR/loss-to-lease rollup]
The unit mix rolls up to two gross potential rents: $662,400 at in-place rents and $748,800 at market. The gap — $86,400 a year of loss to lease — is the investment thesis stated as a number: the revenue that exists in the market but not yet in this rent roll. The renovation plan targets 40 of the 48 units; the model's stabilized revenue therefore lands below full market GPR (about $736,800), because eight classic units stay closer to in-place levels. That restraint matters: a pro forma that flips every unit to market rent on day one is describing a different, imaginary property.
Tab 3 — Operating Expenses: Benchmarked, Not Guessed
[SCREENSHOT: Operating Expenses tab — line-item expense build with per-unit and %-of-EGI check columns]
Expenses enter line by line — taxes, insurance, R&M, turnover, utilities, payroll, management, administrative — at $5,800 per unit in-place, rising to $6,100 per unit stabilized (renovated units run more services, and taxes step up with value). The two check columns do the quality control: per-unit figures against plausible ranges, and the aggregate ratio — about 44% of EGI here — against the property's own history. Note management is in the build at a market rate. It always is, in this model; the fee line has no delete key.
Tab 4 — The T-12 Bridge: In-Place to Stabilized, Honestly
[SCREENSHOT: T12 vs Pro Forma tab — the bridge from in-place NOI to stabilized NOI with each adjustment as its own line]
This tab is the deal's honesty ledger. It starts from in-place NOI of $354,000 — the property as it actually operates: in-place GPR less 8% economic vacancy (physical vacancy plus bad debt plus concessions), plus other income, less in-place expenses. It ends at stabilized NOI of about $417,400. Every step between is a named adjustment: the phased rent premiums, the tax reset, the expense normalization. The two endpoints are the deal in one sentence — you are paying a 6.2% cap for $354,000 of income, and underwriting a plan to build it to $417,400.
Tab 5 — Debt Sizing: Two Constraints, One Loan
[SCREENSHOT: Debt Sizing tab — LTV and DSCR constraint calculations side by side with the governing loan amount flagged]
At 65% loan-to-value, proceeds are $3,705,000; at an illustrative 6.4% rate on 30-year amortization, annual debt service is $278,100. The model tests coverage on in-place NOI — the income that exists at closing — and reads 1.27x, clearing a 1.25x floor with little room. The tab shows both constraints and flags which governs: this deal is LTV-constrained, but barely, and a half-point of rate would flip it to DSCR-constrained. Stabilized coverage projects to 1.50x — the ramp the lender is being asked to believe in.
Tab 6 — The 10-Year Cash Flow: The Plan on a Timeline
[SCREENSHOT: 10-Yr Cash Flow tab — annual columns from GPR through levered cash flow, with the reversion in year 10]
The projection phases the business plan rather than assuming it: NOI ramps from $354,000 toward stabilization across the first three years as units renovate on turnover, then grows at the assumed rates. Below NOI, debt service holds at $278,100 while cash flow climbs — from roughly $98,000 in year one (a thin 3.8% cash-on-cash on the ~$2.61 million of equity, which includes the $500,000 renovation budget) to about $139,000 stabilized (5.3%). Year ten adds the reversion: year-eleven NOI of about $519,000, capitalized at the 6.5% exit cap, less 2% selling costs and the ~$3.13 million loan payoff — roughly $4.69 million net to equity.
The thin early years are worth pausing on, because they are the honest signature of a value-add pro forma: capital goes in early, income arrives on the renovation schedule, and any example deal showing fat year-one cash flow on a heavy reposition should make you suspicious of the whole file.
Tab 7 — Returns: What the Deal Actually Earns
[SCREENSHOT: Returns tab — levered and unlevered IRR, equity multiple, and cash-on-cash by year]
The full suite, from the cash flows above: a levered IRR of about 10.8% and an equity multiple of roughly 2.4x over the ten-year hold, with cash-on-cash reported by year so the income ramp is visible rather than averaged away. Read honestly, this is a moderate outcome — deliberate on our part. The deal's yield on cost (stabilized NOI over price plus renovation) is about 6.7% against a 6.5% exit cap: a spread of barely 20 basis points, which is the model quietly reporting that the value-creation margin here is thin. A worked example that printed a 20% IRR would teach you what marketing looks like; this one teaches you what underwriting looks like.
Tab 8 — Sensitivity: Where the Deal Breaks
[SCREENSHOT: Sensitivity tab — the 5×5 entry cap × exit cap matrix of levered IRR, with the base case highlighted]
The 5×5 grid varies entry and exit cap rates around the base case and reprices the levered IRR at each intersection. The reading that matters is directional: how quickly the 10.8% erodes as the exit cap widens, and which corner of the grid still clears your hurdle. On this deal — thin spread, modest ramp — the grid shows meaningful exit-cap exposure, which is exactly the conversation the model exists to force before the deposit goes hard.
Tab 9 — GP/LP Waterfall: the Same Deal, Split Two Ways
[SCREENSHOT: GP/LP Waterfall tab — capital and preferred return accounts with the residual split, showing LP and GP returns separately]
If the deal is syndicated, the equity cash flows above are only half the story — the waterfall divides them. The example runs a standard structure: capital and an 8% preferred return come back pari passu, then the residual splits with the GP's promote. The tab reports what each party actually earns from the same deal-level cash flows — the LP's IRR landing below the deal's 10.8%, the GP's above it, with the promote as the visible wedge between them. Filled out, the tab makes a point every syndicator eventually explains to an investor: "the deal's IRR" and "your IRR" are different numbers by design, and a transparent model shows both.
Tab 10 — Investment Summary: the Page That Leaves the Building
[SCREENSHOT: Investment Summary tab — the one-page lender/LP-ready printout of the full deal]
The final tab condenses the whole file to a single lender- and LP-ready page: the deal, the two NOIs, the financing, the return suite, the sensitivity read. This is the page that gets attached to the loan request or the investor deck — and because every number on it traces back through the tabs above, it is a summary you can defend line by line, which is the entire point of building the model this way.
What to Steal From This Example
Five habits this filled-out pro forma demonstrates, portable to any deal:
- Two NOIs, always — in-place and stabilized, with a named bridge between them.
- Phased premiums — renovation income arriving on the turnover schedule, never on day one.
- Both debt constraints on screen — with the binding one flagged.
- Conservative exit convention — expansion assumed, so the market owes the deal nothing.
- Returns read as a suite — IRR beside the multiple, the cash-on-cash ramp, and the yield-on-cost spread that diagnosed this deal's thinness in one line.
Frequently Asked Questions
Is this a real deal? No — every figure is illustrative, constructed to be internally consistent so the walkthrough teaches the mechanics. The numbers behave like a real deal's because they are computed the way a real deal's would be.
Why is the example IRR only ~11%? Because that is what these honest assumptions produce. An example deal exists to show you how a model surfaces a deal's true shape — including thin spreads — not to impress you. Change the entry price or the premium capture and the grid shows you exactly what moves.
Can I get this pro forma filled out like the example? Yes — The Multifamily Sheet ships pre-filled with an illustrative 48-unit value-add deal, so every tab works before you enter your own numbers. Replacing the example inputs with your deal is the intended workflow.
Work the Same Deal Yourself
The fastest way to internalize this walkthrough is to open the model and trace it live. The Multifamily Sheet is the file in these screenshots — pre-filled with the illustrative deal, fully unlocked, every formula visible, with the T-12 bridge, dual-constraint debt sizing, GP/LP waterfall, sensitivity grid, and a documented methodology PDF. Swap in your own rent roll and the walkthrough becomes your underwriting. The full catalog is in the store.
This article is for educational purposes only and does not constitute investment, legal, or tax advice. All deal figures are illustrative examples, not market data. Consult qualified professionals before making investment decisions.
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