About the Value-Add Apartment Acquisition Model
The A.CRE Value-Add Apartment Acquisition Model is built specifically for value-add multifamily deals. It includes an extensive investment cash flow and renovation budgeting module, option for up to four capital sources, in-place and stabilized operating cash flow underwriting, option to either sell or refinance at stabilization, and a 4-tier equity waterfall.
Designed for analysts underwriting heavy-lift renovation business plans. Last updated June 2025. Author: Spencer Burton.
New to the Value-Add Model? Watch this first.
A quick video tour of the model from Spencer himself. Then follow the three steps below to get productive fast.
Then follow these three steps
Read the Guide to Using A.CRE Financial Models
How every model is structured (blue = input, black = output) and how to navigate them.
Read the Guide →Read Best Practices in Real Estate Financial Modeling
The conventions institutional firms actually use. This will make every A.CRE model feel familiar.
Read the Article →Pick a tutorial below based on what you’re modeling
Start with the overview, then go deeper into renovation budgeting, capital structure, and waterfall topics.
Pick a topic below →Guide to Getting Started with the Value-Add Apartment Acquisition Model
Spencer walks through the entire model top-to-bottom — inputs tab, renovation budget, in-place vs. stabilized cash flows, capital sources module, refi vs. sale analysis, and the 4-tier equity waterfall. Watch this first to orient yourself before diving into any topic below.
Watch the Tutorial ↓Using the Model to Assess a Value-Add Apartment Acquisition
Spencer takes a hypothetical value-add apartment opportunity through the full underwriting workflow — unit mix, renovation budget, in-place vs. stabilized cash flows, acquisition financing, and reading the IRR and equity multiple outputs. The fastest way to see how all the pieces fit together on a real deal.
Watch the Tutorial ↓Modeling Capital Sources in the Value-Add Model
The Value-Add model supports up to four capital sources. Spencer walks through how to set up a multi-tranche capital stack — senior debt, mezzanine debt, preferred equity, and common equity — and explains how each source flows through the waterfall at disposition or refinancing.
Watch the Tutorial ↓Modeling Partnership-Level Returns with the 4-Tier Equity Waterfall
Spencer walks through the model’s built-in 4-tier equity waterfall — preferred returns, IRR hurdle tiers, and GP promote calculations. Includes how to set up the partnership inputs and read the LP vs. GP return split in the output summary.
Watch the Tutorial ↓All Tutorials by Topic
Ten step-by-step video tutorials organized by topic. Open a section and work through what matters for your deal.
Getting Started
Tutorial #1 — Guide to Getting Started with the Value-Add Apartment Acquisition Model
Spencer walks through the entire model top-to-bottom in this introductory overview — inputs tab, renovation budget, in-place vs. stabilized cash flows, capital sources module, refi vs. sale analysis, and the 4-tier equity waterfall. Watch this before diving into any topic-specific tutorial below.
Tutorial #2 — Adding and Deleting Unit Types
Customizing the rent roll to match your property's actual unit mix and configuration.
Underwriting a Deal
Tutorial #3 — Using the Model to Assess a Value-Add Apartment Acquisition
Spencer takes a hypothetical value-add apartment opportunity through the full underwriting workflow — entering unit mix, renovation budget, in-place vs. stabilized cash flows, acquisition financing, and reading the IRR and equity multiple outputs. A set of sample assumptions is available to download and follow along.
Tutorial #4 — Modeling a Refi vs. Sale Analysis at Stabilization
At stabilization, the Value-Add model lets you compare selling the property outright vs. refinancing and continuing to hold. Spencer walks through how to toggle between the two exit strategies, set up both scenarios, and interpret the comparative return metrics side by side.
Cash Flows
Tutorial #5 — Modeling In-Place vs. Stabilized Operating Cash Flows
The Value-Add model tracks two cash flow streams simultaneously — in-place rents during the renovation period and the projected stabilized rents after units are turned. Spencer explains how the model separates and blends these streams and how renovation timing affects the NOI bridge from in-place to stabilized.
Financing & Capital Sources
Tutorial #6 — Modeling Capital Sources in the Value-Add Model
Spencer demonstrates how to set up a multi-tranche capital stack using the model’s Capital Sources module — senior debt, mezzanine debt, preferred equity, and common equity — and shows how each tranche flows through to the waterfall at exit or refinance.
Tutorial #7 — Using the Variable Interest Rate Module
Switching from fixed to variable rate debt and working with yield curve inputs.
Tutorial #8 — Modeling Lender Reserves
Modeling lender reserve requirements as part of your financing structure.
Returns & Waterfall
Tutorial #9 — Using the GP Fees Module
Setting up AUM fees, acquisition fees, and disposition fees. Understanding gross vs net returns before and after GP fees and promote.
Tutorial #10 — Modeling Partnership-Level Returns with the 4-Tier Equity Waterfall
Spencer walks through the model’s 4-tier equity waterfall — preferred returns, IRR hurdle tiers, and GP promote calculations — and shows how to set up partnership inputs and read the LP vs. GP return split in the summary output.
Additional Resources
Best Practices in Real Estate Financial Modeling
The conventions institutional modeling teams actually use — blue input cells, black output cells, no hard-coding, and consistent structural patterns. Understanding these principles makes every A.CRE model feel immediately familiar from day one.
View Resource → TutorialWatch Me Build A Construction Draw Schedule
Renovation draws are one of the trickiest parts of value-add underwriting — lenders advance funds in stages, interest accrues on drawn balances, and timing mismatches can crush cash flow projections. Spencer builds a construction draw schedule from scratch in Excel.
View Resource → ArticleA.CRE 101: How To Use The Income Capitalization Approach
Every value-add underwriting model ultimately hinges on what the stabilized property is worth at exit. This guide walks through the income capitalization approach — NOI, cap rate, and resulting value — so you can model a credible hold-period return or sale scenario.
View Resource → Case StudyCase Study #1 — Presidio: Value-Add Apartment Acquisition
A full value-add apartment acquisition modeled start to finish. The Presidio case study covers unit mix assumptions, renovation budget, in-place vs. stabilized cash flows, and the equity waterfall — a real-world template to stress-test your own underwriting assumptions.
View Resource → TutorialWatch Me Build: American-Style Real Estate Equity Waterfall
Spencer builds an American-style equity waterfall from scratch in Excel, showing how preferred returns, IRR hurdles, and profit splits flow through each tier — the exact structure that powers the 4-tier waterfall in the Value-Add model.
View Resource →Frequently Asked Questions
What is the Value-Add Apartment Model designed for?
The A.CRE Value-Add Apartment Acquisition Model is purpose-built for apartment acquisitions involving renovations. It includes renovation budgeting, in-place and stabilized operating cash flows, an option to sell or refinance at stabilization, and a 4-tier equity waterfall.
What capital sources does the Value-Add Model support?
The model supports up to four capital sources, giving you flexibility to model complex capital stacks with multiple debt and equity tranches.
Is the Value-Add Apartment Model free?
Yes. It is free. Download it from the Adventures in CRE website through a free checkout.
How is this different from the Multifamily Acquisition Model?
The Value-Add model is specifically designed for renovation scenarios with built-in renovation budgeting and in-place vs. stabilized cash flow comparison. The Multifamily Acquisition Model is better for straightforward stabilized apartment acquisitions.
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