Many moons ago we showed you how to use drop-down menus as part of your spreadsheets. These are handy in that you can toggle a variable, and by making that variable a driver of outputs, easily switch between a pre-set selection of list items as the input. For example, Valuation Basis: Forward NOI vs. TTM NOI.
The good news is that there is an even easier way to enter your list choices than creating a list in the spreadsheet grid itself. All you have to do is shown below.
After selecting the cell in which you wish the drop-down menu to appear, on the ribbon Data tab, select Data Validation > Data Validation
Then, Allow: List, and specify the text values in the Source field, separated by commas, and click the OK button.
- Investment Overview – executive summary of the opportunity
- Property Description – existing and future physical property characteristics
- Business Plan – how you will make money
- Rationale – why this particular investment, and why now
- Sponsorship – identification of principals and presentation of track record
- Deal Structure – equity contributions by entity, description of any seniority/preferred/subordinate status
- Cash Flow Waterfall – rules for the equity entity return of capital and return on capital
- Sources & Uses – full capital structure (sources), and detailed total costs including transaction costs for acquisitions (uses)
- Underwriting Assumptions - all of the inputs you made in blue in your pro forma
- Returns – net cash flow, multiple on equity, NPV and IRR at the project level, and also at the individual partner levels
- Sensitivities – a spectrum of returns scenarios given different underwriting assumptions (see here for an elegant way to build these tables in Excel)
- Risks & Mitigants – what are the risks involved, are you going to mitigate or accept them?
- Supporting Schedules
- market info / trends
- cash flow / waterfall projections
- location maps
- photos / renderings, etc.
What did I leave out?
Valuate can provide beautiful graphics for many of these memo sections. You can simply do a screencapture (such as with free program Jing) and paste the relevant modules into your Word doc.