Full-cycle developer model — acquisition through lot sales. Multi-product lot mix · phased costs · unlevered & levered IRR · 3-scenario sensitivity · annual cash flows.
📍 Project Info
🏘️ Lot Mix & Pricing
Enter each product type. Set lots = 0 to exclude. Price escalator applies annually during the absorption/sellout period.
| Product Type | # Lots | Base Price/Lot | Price Escalator %/yr | Lots/Month | Est. Revenue |
|---|---|---|---|---|---|
| SFD — Single Family | $ |
% |
— | ||
| Townhome / Attached | $ |
% |
— | ||
| Active Adult / Villa | $ |
% |
— | ||
| Total / Blended | — | — | — | — | — |
💡 Price escalator compounds annually during the sellout period. Leave at 0% if prices are fixed.
🏦 Acquisition & Entitlement
Title, escrow, transfer tax, recording — typically 2–4%
Non-refundable at risk during due diligence
Environmental, surveys, rezoning, planning fees
Off-site road dedications, TDRs, development rights
📅 Development Timeline
Planning, permits, engineering before breaking ground
Time to complete infrastructure and deliver lots
Typically = pre-dev + construction period
Industry avg 2–4%/yr; apply to hard costs
💰 Financing Assumptions
Lenders typically 60–75% LTC for land dev
Compensation for developer oversight; typically 2–5%
Transfer tax, title, commissions — typically 2–4%
Industry target: 20–25% unlevered for land dev
🔨 Hard Development Costs — Site Improvements
Enter per-lot amounts or total project amounts. All $/lot figures are multiplied by total lots automatically.
Water, sewer, storm drainage
Electric, gas, telecom, fiber
Road widening, signal work, utility extensions
Industry standard: 10–15% of hard dev costs
📋 Soft Costs
Applied for full project duration
Results open in the Summary Dashboard tab automatically.
💧 Revenue & Cost Waterfall
📈 Return Analysis vs. Industry Benchmarks
📊 Unlevered Returns (All-Cash)
📊 Levered Returns (with Construction Loan)
🧩 Total Development Budget Breakdown
📘 How to Read Your Results
✅ Green = Good
Margin ≥25% · Unlevered IRR ≥target · Equity multiple ≥1.5×. Project meets industry return thresholds.
⚠️ Yellow = Marginal
Margin 15–25%. Possible, but little cushion for overruns. Renegotiate land price or reduce costs before proceeding.
Profit Margin
What it is: Gross profit ÷ net revenue.
Why it matters: Must be ≥25% to cover unexpected cost overruns and still produce an acceptable return. Land dev is risky — 15% feels fine until costs run 10% over.
Industry target: 25–30%+
Unlevered IRR
What it is: All-cash return ignoring financing — pure project return.
Why it matters: Lets you compare deals regardless of how they're financed. If unlevered IRR < loan rate, leverage actually hurts you.
Industry target: 20–25%
Levered IRR & Multiple
What it is: Return on just the developer's equity (after loan repayment). Should exceed unlevered IRR.
Multiple: For every $1 of equity invested, how many dollars come back. 2.0× means you doubled your money.
Industry target: Multiple ≥1.5–2.5×
Profit / Lot
What it is: Total gross profit divided by number of lots. Simple sanity check.
Industry target: $25,000–$60,000/lot is typical for finished residential lots. Below $20k/lot is concerning; above $70k suggests either premium pricing or lean costs.
Land as % of TDC
What it is: Land acquisition cost as a % of total development cost.
Industry rule of thumb: Land should be 20–30% of TDC. Above 35% means you overpaid for land and may struggle to hit return targets. Below 15% is often a sign of a great land buy.
Phase-by-Phase Development Proforma
| Run the calculator to see the phase proforma. |
Sources & Uses of Funds
Annual Unlevered Cash Flow Statement
| Run the calculator to see annual cash flows. |
🔄 3-Scenario Quick Compare — Bear / Base / Bull
Stress-tests your base assumptions against downside (costs +10%, prices −5%) and upside (costs −5%, prices +5%) scenarios.
📊 Land Price Sensitivity
How does return change as land price moves? Your base case is highlighted.
| Run calculator first. |
📊 Lot Price Sensitivity
How does return change as average lot price moves?
| Run calculator first. |
📊 Absorption Rate Sensitivity
Faster absorption = higher IRR due to shorter carry period.
| Run calculator first. |
📊 Hard Dev Cost Sensitivity
Cost overruns are the #1 risk in land development. This shows the impact.
| Run calculator first. |
Revenue vs. All-In Cost by Phase
Cost Breakdown (% of Total Budget)
Annual Cash Flow & Cumulative Position
Revenue Mix by Product Type
Every formula, assumption, and industry standard behind this proforma. Use this to understand, audit, or explain the model to partners, lenders, or investors. This content is also exported to the Excel file.
💰 Revenue Calculation
Average Price per Lot
Avg Price = Base Price × (1 + Escalation%/yr × Sellout Years / 2)
Mid-point escalation: Lots are sold evenly across the sellout period, so the average sale price is at the mid-point of the escalation curve. Example: $185k base, 3%/yr escalation, 1.4-year sellout → avg price = $185k × (1 + 0.03 × 0.7) = $188,900.
Net Revenue
Net Revenue = [Σ (Lots × Avg Price)] × (1 − Sale Closing Cost %)
Sale closing costs cover transfer tax, title insurance, recording fees, and agent commissions. Typically 2–4% of gross revenue. This is the developer's actual cash received from lot sales.
Sellout Period
Sellout Months = Total Lots ÷ Total Absorption Rate (lots/mo)
Absorption rate is the combined pace across all product types. Faster absorption = shorter carry period = less interest cost = higher IRR. This is the single biggest variable affecting return on a fixed-margin deal.
🔨 Hard Development Costs
Per-Lot Items
Cost = $/Lot × Total Lots
Grading, utilities, roads, curbs, landscaping scale linearly with lot count.
Cost Escalation
Esc = Hard Base × Rate × (Dev Months/12 ÷ 2)
Applied at midpoint of construction. Reflects materials and labor inflation (industry avg 2–4%/yr). Dividing by 2 gives average exposure — costs are incurred gradually, not all on day 1.
Contingency
Contingency = (Hard Base + Escalation) × Contingency %
Industry standard: 10–15%. Covers unforeseen site conditions, utility conflicts, design changes, weather delays. Underestimate at your peril — land dev always has surprises.
📋 Soft Costs & Developer Fee
Property Tax Carry
Prop Tax = $/lot/yr × Lots × (Total Months / 12)
Developer pays property tax throughout the full project. Longer timelines = higher carry. A key reason to minimize delays.
Marketing & Sales
Marketing = Net Revenue × Marketing %
Commissions, sales center, signage, advertising. Typically 1–2% of net revenue for residential lots.
Developer Fee
Dev Fee = (Acq + Hard + Soft) × Dev Fee %
Compensation for developer oversight and risk. Typically 2–5% in a GP/LP structure. Set to 0% for a solo developer — the profit is the fee. Setting this to 0 does NOT change IRR, only how profit is labeled.
💰 Financing Logic
Loan Balance
Loan = TDC (ex-fin) × LTC %
LTC = Loan-to-Cost applied to all pre-financing costs. Lenders typically advance 60–75%. Lower LTC = less leverage = safer, but lower levered returns.
Construction Interest
Int = Loan × 60% × Rate × (Dev Mo/12)
Assumes 60% average draw during construction (S-curve: slow start, ramps up, tapers near completion). Interest accrues on drawn balance only.
Sellout Interest
Int = Loan × 30% × Rate × (Sellout Mo/12)
Loan balance declines as lots sell and proceeds repay principal. 30% average remaining balance during the sales period reflects this paydown.
📈 Cash Flows & IRR
Unlevered Cash Flows (All-Cash)
CF[0] = −Total AcquisitionCF[y] = −Dev Cost Total / Dev YearsCF[y] = Net Revenue / Sale YearsIgnores financing entirely. Measures the pure project return — useful for comparing deals regardless of capital structure.
Levered Cash Flows (with Loan)
CF[0] = −Acq × (1−LTC%)CF[y] = −(Dev/yr) × (1−LTC%)CF[y] = Revenue/yr − Loan Repay/yr − Finance/yrDeveloper's equity only. Loan covers its share of costs; revenue repays loan principal + interest. Shows actual cash return on capital invested.
IRR Solver — Bisection + Newton-Raphson
Finds rate r where: Σ CF[t] / (1+r)^t = 0
Bisection narrows to within 1e-6 accuracy (80 iterations), then Newton-Raphson refines to 11 decimal places (60 iterations). Same methodology as Excel's XIRR function. Returns NaN if no solution exists (e.g., all cash flows are negative).
📊 Industry Benchmarks
Profit Margin
Gross profit ÷ net revenue
≥25% min
Target 30%+
Unlevered IRR
All-cash return
20–25%
Reflects dev risk
Equity Multiple
Total return ÷ equity
1.5–2.5×
2–4 year deal
Profit per Lot
Gross profit ÷ lots
$25k–$60k
Depends on market
Land % of TDC
Acquisition ÷ all-in cost
20–30%
>35% = overpaid
Contingency
% of hard dev costs
10–15%
Never skip this
Construction LTC
Loan ÷ dev cost
60–75%
Lender requires equity
Hard Dev per Lot
Total hard ÷ lots
$40k–$80k
Varies by market
📥 This logic is also exported to Excel
The Calculation Logic sheet in the Excel export contains a full written explanation of every formula, benchmark, and methodology — formatted for sharing with partners, lenders, or investors who want to understand how the numbers were derived.