How to handle Analysis Date different than Lease date?

[Anonymous]

7 years, 3 months ago #2688

Thank you so much for this model

How do you input a different analysis date than when the rental rate changes? For example. if you’re looking at an property starting in March 2018, but the least bumps annually every September how would you handle that? I can see changing the analysis date also changes the start date under rent detail. What I’d like would be to show the rental rates changing in September, but my analysis to incorporate part of the year at the lower rate and the other at the higher rate after the bump.

Also, how would you incorporate a lease that bumps mid month?

Hope my question is clear

[Spencer Burton]

7 years, 3 months ago #3212

I’ll start with the easy question – it’s not possible to incorporate a mid-month bump. To do this would require daily cash flow tracking, for which the marginal benefit is far outweighed by the processing strain such modeling would create.

In terms of annual bumps. Unfortunately, this is another area where I opted for simplicity over precision. Market rent increases and rent bumps occur at the beginning of each year, rather than on the anniversary of the analysis start or lease start. With that said, since making the decision to do it this way, I’ve developed a simpler method (formula) for timing rent bumps that doesn’t create much of a burden on the model. I’m planning on incorporating this change in the next version of the model.

[Anonymous]

6 years, 9 months ago #3214

“I’ve developed a simpler method (formula) for timing rent bumps that doesn’t create much of a burden on the model. I’m planning on incorporating this change in the next version of the model.”

Hi Spencer – Did this new formula get incorporated into the updates? I am building a development model with 2% annual rent bumps but the model is timing those rent bumps at the anniversary of the analysis period, instead of the first month of rent. So for example, if I have an 11 month development/construction period and then begin collecting rent in month 12 (of the analysis period) the cash flow statement shows the project collecting rent based on the initial rate in the RR tab only for month 12. At month 13 the rent is going up 2% and I cant figure out how to make the model apply the annual rent escalation based on the anniversary of rent commencement. While scrolling through the discussion forum I found this post, but I am working with the latest version of the model and cant figure out what I may be doing wrong.

Thanks!

[Spencer Burton]

6 years, 9 months ago #3216

Thanks for the reminder! I’ve added the logic to beta v0.6.4 which I’ll release Aug 25, 2018.