Real estate pro forma calculator

Where AI changes the answer

A real estate pro forma is only as good as the assumptions behind it. The numbers are arithmetic — NOI minus debt service, exit price divided by cap rate — but the judgment calls are where models live or die: which rent growth rate is realistic, what exit cap to assume, how much to reserve for deferred maintenance. This is where AI changes the outcome. **Where AI changes the pro forma:** **1. Auto-fill from a pasted rent roll (this calculator's first live AI feature).** Paste your actual rent roll — unit mix, in-place rents, lease expirations — into the AI assist box and click "Auto-fill from rent roll." The AI (Claude Haiku, accessed through the existing NextAutomation OpenRouter adapter) extracts year-1 effective gross income, unit count, and operating expense estimates from the raw text and pre-fills the inputs. This is decision-support, not underwriting advice: every AI-extracted value is prominently labelled "AI-extracted — verify before use." Review each value against your actual rent roll and T12 statements before committing to the model. The manual calculator works fully without the AI — the rent-roll assist is optional and never gates your result. **2. Stress-testing exit assumptions.** Exit cap rate is the single most dangerous assumption in a pro forma model. A 25bps move in the exit cap on a $200,000 NOI property changes the terminal value by roughly $770,000 — which can swing IRR by 100–300bps depending on leverage and hold period. AI can model dozens of exit scenarios in seconds and surface which inputs move the dial the most in your specific deal structure. Any market cap-rate range shown is an ESTIMATE: validate against recent comparable transaction cap rates for your asset class and submarket. **3. Operating expense reality-check.** Pro formas routinely understate expenses — missing management fees (typically 8–10% of collected rent, ESTIMATE), reserves for replacement ($150–$300/unit/year for multifamily, ESTIMATE), or insurance increases in high-cat markets. AI can flag when your operating expense ratio sits below 35% (a red flag on multifamily — it likely means expenses are understated) and surface the specific line items most commonly omitted on seller-provided pro formas. **4. Equity multiple vs. IRR.** IRR assumes all interim cash flows are reinvested at the IRR rate — which overstates the true annualized return when distributions are redeployed at lower rates. Equity multiple corrects for this: it is a simple ratio of total distributions to equity invested, with no reinvestment assumption. A 20% IRR over 3 years with a 1.35x equity multiple is structurally weaker than a 14% IRR over 7 years with a 2.0x equity multiple. This calculator shows both simultaneously so you can evaluate the tradeoff for your specific hold horizon and capital return targets. This calculator is decision-support for CRE investors building multi-year income projections. It does not substitute for a lender's underwriting, an MAI appraisal, or investment advisory services.

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