Modelling Test - Please tear it apart :)

Hi all,

I currently have a modelling test lined up and I suspect it will be a development model. Most of my experience is investment/income producing assets so I haven't really modelled much development in my time although I think I understand most the concepts....

I found the following modelling test on WSO and the instructions were to complete it in 2 hours. I managed to do it in this time and I have also attached a copy of my completed model - any input would be much appreciated.

I had to convert the model to xls to be able to upload it to the forum so I hope everything works. Not sure if the macro will work but if all else fails, a manual goal seek will be just as effective.

Modeling Exercise

All inputs below should be flexible assumptions

Development Program
* 200,000 SF office building
* Land purchase price: $20M ($100 per FAR)
* Closing Costs: 1% of purchase price
* Hard Costs: $300 psf
* Soft Costs: (excluding TI's, LC's and Debt): 15% of hard costs
* TI's: $60 psf - paid at tenant occupancy
* LC's: $18 psf - paid six months before tenant occupancy

Construction & Lease-up
* 24 Month Construction Period, beginning at land close date
* Costs spent evenly over construction period
* 2 Tenant Lease-up of equal size (one tenant at construction completion; one 6 months after completion)
* Lease up to 95%
* Rent $4.25 NNN
* Free Rent: 3 months free
* Annual rental bumps: 3%
* Annual Operating Expenses during Lease-Up: $16 psf

Debt Assumptions
* 60% LTC
* Rate: 5% all-in interest rate
* All equity drawn first; then debt
* Use available cash flow to offset debt costs, as available

Hold Period:
* 5 years after stabilization
* Exit Cap Rate: 5.5%
* Transaction Fees: 1.5%

Joint Venture Structure
* LP invests 95% of required equity / GP invests 5%
* GP receives a 20% promoted interest over a 12% IRR to the LP

Required Output
* Required Project Equity, Net Profit, IRR and ROC (Return on Capital)
* Required LP (after promote) Equity, Net Profit, IRR and ROC (Return on Capital)