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Scenario Analysis Tool using the Equity Waterfall Model (UPDATED MAY 2022)

I received a question this morning asking how to use scenario (or sensitivity) analysis with our Real Estate Equity Waterfall Model. I started to answer the question via email, decided to build an Excel file to go along with my answer, and ultimately concluded that a video would be the easiest way to walk you through how I do scenario analysis.

Now keep in mind, Mike touched on this subject in a previous blog post several months back on how to build data tables for real estate analysis. This post/video covers the same topic but comes at it in a slightly different way. In my mind the question comes down to: how do we analyze the effect of changes in the terminal cap rate and changes to cash flow over the hold period on LP, Sponsor, and property level IRR? I hope the video below answers that question and provides you with a foundation to do your own real estate scenario/sensitivity analysis.

I’ve attached a link below to the Excel file used in the video. If you have any questions, please don’t hesitate to contact either Mike or I.

Scenario Analysis tool using the Equity Waterfall Model

  • Scenario analysis using the data table feature in Excel
  • Based on an earlier version of the real estate equity waterfall model


This version of the model is only compatible with Excel 2013, Excel 2016, and Excel 365.

Download the Scenario Analysis Toolusing the Equity Waterfall Model

To make this tool accessible to everyone, it is offered on a “Pay What You’re Able” basis with no minimum (enter $0 if you’d like) or maximum (your support helps keep the content coming – typical tools sell for $25 – $100+ per license). Just enter a price together with an email address to send the download link to, and then click ‘Continue’. If you have any questions about our “Pay What You’re Able” program or why we offer our models on this basis, please reach out to either Mike or Spencer.

We regularly update the file (see version notes). Paid contributors to the tool receive a new download link via email each time the tool is updated.

Version Notes


  • Initial release

About the Author: Born and raised in the Northwest United States, Spencer Burton has over 20 years of residential and commercial real estate experience. Over his career, he has underwritten $30+ billion of commercial real estate at some of the largest institutional real estate firms in the world. He is currently President and member of the founding team at Stablewood. Spencer holds a BS in International Affairs from Florida State University and a Masters in Real Estate Finance from Cornell University.