Single Tenant Industrial Real Estate Model

Commercial Real Estate Properties, Financial Model, Real Estate, Residential Properties

10-year Financial Projections, 5-year Financial Projections, Accounting, Amortization, Budget, Budgeting, Cash Flow Analysis, Cash Flow Projections, Cash-on-Cash Multiple, CFO, DCF Model, Debt Amortization, Debt Schedule, Debt Service Coverage, Developers, Discount Rate, Excel, Financial Analysis, Financial Due Diligence, Financial Feasibility, Financial Model, Financial Modeling, Financial Planning, Financial Projections, Financial Statements, Forecasting, Income Statement, Investing Cash Flows, Investment Multiple, Investor Cash Flows, Investors, IRR (Internal Rate of Return), Joint Venture, LBO (Levered Buyout), NPV (Net Present Value), Private Equity, Private Equity Waterfall Distribution Models, Pro-Forma, Real Estate Valuation, Return on Invested Capital (ROIC), Return on Investment (ROI), Revenue Projections, Scenario Analysis, Sensitivity Analysis, Startup Financial Models, Terminal Value, Three Statement Model | Three Financial Statements, Venture Capital

Video Overview:

This model works great for new development or acquisition scenario analysis. There are assumptions for debt and equity, rental income, expenses, taxes, depreciation, and a multitude of cash flow waterfall options.

Single tenant industrial real estate is simple from a rental income perspective. The assumptions are simply centered around starting rent, start month of rent, vacancy / turnover loss, and rent escalation. If you are doing an NNN deal or some variation that requires the tenant to pay some of the expenses, simply 0 out those expenses on the OPEX tab.

The model will display a cash flow stream and there are two waterfall timing conventions. One is based on monthly cash flows; the other is based on annual cash flows and assumes the minimum investment requirement happens up front. Within those timing conventions, I have included an IRR hurdle waterfall and a simple preferred return waterfall structure. Outputs from that include final IRR, equity multiple, and total cash-on-cash return. The results from all potential options are displayed on the front page.

For proper underwriting, the model displays debt service coverage ratios of the project over time. I’ve also considered depreciation recapture taxes if the user wants to show post-tax cash flows.

The hold period can be up to a maximum of 15 years and the exit value is based on a defined cap rate that applies to the final NOI in the trailing 12-months from the forecast end month.

There is an option for a construction loan or a simple p+i loan to start and up to two future REFI options can be planned out.

GP fees are also integrated for acquisition, development, asset management, disposition and a hard coded fee that the user can define the month of and the amount. These are all optional.

I have also integrated a pro forma income statement, balance sheet, and cash flow statement that updates as assumptions are adjusted.

Single tenant industrial real estate refers to properties specifically designed and used for industrial purposes—such as manufacturing, production, distribution, or warehousing—that are leased or occupied by a single tenant. This type of property offers distinct advantages for both the tenant and the property owner. For tenants, having a single-tenant facility often means the ability to tailor the space to fit specific operational needs without compromise, enhancing efficiency and productivity. This could include customizations in layout, machinery installations, and security enhancements. For property owners, single tenant properties can be attractive because they often come with long-term lease agreements, providing stable rental income and reduced management complexity compared to multi-tenant setups. These properties are particularly appealing to investors looking for lower-risk real estate assets with predictable cash flows, as the tenant’s business stability and commitment to the location often translate into reliable tenancy.

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