All Forum Posts by: Joseph Rappleye

Hey Michael, I haven't got an answer on this yet.  I ran the numbers again today using Michael Blank's Syndicated Deal Analyzer (SDA) and I got to the same numbers as I did before when I calculated it manually.  

I did a goal seek to see if they inadvertently used a different preferred return rate and backed into a 5.515% preferred return, which gets me the $227,085 LP cash flow in year 1.  However, that rate doesn't work for the remaining years.  Good times!  

If you come across any answers, let me know!

I'm trying to recalculate the LP Annual cash flows in table 14-5 on page 236 of Multifamily Millionaire Volume II and can't quite get there. I'm sure I'm missing something, so hoping this community has some insight.

Here is the scenario:

Total invested capital (all from LPs) = $3,142,095

Total project level cash flow = $243,756

Preferred return = 7%

LP Equity share = 70%

Based on these assumptions, I'm calculating LP cash flow of $242,283, but the book is showing $227,085.  Here's my calculation:

Preferred return hurdle = $3,142,095 * 7% = $238,847

Cash flow available for equity splits = $243,756 (total project level cash flow) - $238,847 (preferred return hurdle) = $4,909

LP share of remaining cash flow = $4,909 * 70% = $3,436

LP cash flow = $238,847 (preferred return) + $3,436 (LP share of equity split) = $242,283

How are the authors getting to $227,085?  What am I missing?