Hi Spencer, just started working with this model and it seems like a great tool. One question – why is it not possible to model 1st gen rent with precision? I imagine it would be a formula change vs something else?
In terms of your question about 1st generation rent and precision. The model offers a greater level of precision on 1st generation leases then most Excel models, but it lacks the precision of non-Excel solutions in a couple of important ways:
1) Rent escalation assumptions are made through annual periods, and as a result lacks the precision that comes with monthly (or even daily) escalation assumptions.
2) Expense recovery is an approximation, and is calculated using an expense recovery percentage per year rather than attempting to model the various expense recovery methods common in the industry.
To why I chose to model 1st generation leases this way. It comes down to complexity, model size, and memory resources. The more complexity you add to the model, the larger the file and the more processing power is required to handle that complexity. Plus, the time it would take to model to the same precision as ARGUS or other non-Excel solutions just wasn’t worth the marginal benefit, it in my view.
