Real Estate Pro Forma Template (2026): Line Items + Excel

A real estate pro forma template is a spreadsheet that projects a property's income, expenses, and returns over a hold period. It runs top to bottom: gross potential rent, minus vacancy and loss-to-lease, equals effective gross income, minus operating expenses equals net operating income, minus debt service and capital reserves equals cash flow to equity.

That is the whole shape of the model. Once you can rebuild those lines in a blank sheet, you can underwrite any deal and check anyone else's numbers. This guide gives you the line items in order, the formulas, an Excel build sequence, and how to read a seller's pro forma against the actuals. The quality of the inputs makes or breaks the output, so every number you copy from a broker is a number you should be ready to defend.

The line items in a real estate pro forma, in order

Here is every line the way an underwriter reads it, top to bottom. Build the revenue block first, then expenses, then the lines below net operating income.

Revenue (income lines):

• Gross potential rent. Every unit rented at market, at 100 percent occupancy. This is the ceiling, not the expectation.
• Loss-to-lease (deduction). The gap between market rent and what in-place leases actually charge.
• Other income. Parking, laundry, application and pet fees, and utility reimbursement (RUBS).
• Vacancy and credit loss (deduction). Units sitting empty plus rent you never collect.
• Effective gross income. What is left after the deductions. This is the real top line the rest of the model runs on.

Operating expenses (by category):

• Property taxes. Often the biggest single line, and the one that resets after a sale.
• Insurance. Quote it fresh; do not inherit the seller's old premium.
• Property management fee. Usually a percentage of effective gross income.
• Payroll. On-site staff where the asset has them.
• Repairs and maintenance. Routine upkeep, not capital projects.
• Turnover. Make-ready costs each time a unit rolls.
• Marketing and advertising. Leasing and listing spend.
• Utilities. Whatever the owner pays rather than the tenant.
• Administrative. Office, software, legal, and bank costs.
• Contract services. Trash, pest, snow, elevator, and similar.
• Landscaping. Grounds and common areas.
• Reserves. A per-unit set-aside for future capital needs.

Below net operating income:

• Net operating income (NOI). Effective gross income minus operating expenses.
• Debt service (deduction). Annual principal and interest on the loan.
• Capital reserves and capital expenditures (deduction). Roofs, HVAC, parking lots, and the value-add scope.
• Before-tax cash flow. What reaches equity after the loan and capital are paid.

Label each line in your sheet as income, deduction, or expense. That habit is what lets a reader rebuild the model from scratch and lets you catch a line that landed in the wrong block.

The formulas every pro forma uses

The structure above is held together by a handful of formulas. These are the ones a clean model spells out.

• Effective Gross Income = Gross Potential Rent + Other Income - Vacancy and Credit Loss
• NOI = Effective Gross Income - Operating Expenses
• Cash Flow to Equity = NOI - Debt Service - Capital Reserves

From those three lines you get the return metrics:

• Cap Rate = NOI / Purchase Price. A property at a 7 percent cap rate is priced to return more on its income than one at 5 percent.
• Cash-on-Cash = Year 1 Cash Flow / Equity Invested. For example, $10,000 of pre-tax cash flow on $50,000 of equity is a 20 percent cash-on-cash return.
• DSCR = NOI / Annual Debt Service. Lenders want this above roughly 1.25, meaning income covers the loan payment with room to spare.
• IRR and equity multiple. Both run across the full hold. IRR is the annualized return on every dollar in and out, including the sale. Equity multiple is total cash returned divided by total cash invested.

A worked example with round numbers

Take a property with $1,000,000 of gross potential rent and $50,000 of other income. Apply 7 percent vacancy and credit loss ($73,500) and effective gross income is $976,500. Run a 45 percent expense ratio and operating expenses are about $439,425, so NOI is roughly $537,075. On a $7,000,000 purchase price that is a 7.7 percent cap rate. Subtract $400,000 of annual debt service and $25,000 of reserves and before-tax cash flow is about $112,075. If you put in $2,000,000 of equity, that is a 5.6 percent cash-on-cash return in year one. Plug your own deal's numbers into the same chain and the sheet should reconcile to the dollar.

Build it in Excel or Google Sheets, step by step

Searchers want to build the file, not just read about it. Here is a build sequence that mirrors how the strongest templates are organized. The order matters, because each tab feeds the next.

1. Start with an assumptions block at the top. Purchase price, loan amount, interest rate, term, hold period, annual rent growth, annual expense growth, and exit cap rate. Every other tab references these cells, so you flex the whole model from one place.
2. Build a unit-mix and rent roll. List each unit type, count, and market rent. This rolls up to gross potential rent. For per-door math and comps, see the price per unit formula.
3. Lay in the income and expense lines that produce NOI. Use the revenue and operating-expense lists above. Pull each line from the assumptions and the rent roll so nothing is hard-coded.
4. Add debt service with the PMT function. `=PMT(rate/12, term*12, -loan_amount)` gives the monthly payment from your assumptions block. Multiply by 12 for annual debt service.
5. Project five or ten years and add an exit. Grow rents and expenses each year by your assumption cells. Set the exit value by applying your exit cap rate to the final-year NOI, then compute IRR with `=IRR()` and the equity multiple from total distributions over equity invested.

Most commercial deals model a 5, 7, or 10 year hold. Keep the returns tab fully linked to the assumptions block, so when you change the exit cap or the rent growth, the IRR and equity multiple move on their own. A template that makes you retype numbers in three places is a template that will eventually disagree with itself.

Pro forma vs actuals: read the gap before you trust the number

A seller's pro forma is a best case. The trailing twelve months (T12) of actuals are what really happened. The first job in underwriting is to rebuild the projection from your own inputs rather than inherit the broker's.

Pull current county tax data, get fresh insurance quotes, and set your own vacancy and management assumptions. Then watch the lines that are usually too rosy:

• Vacancy held at 5 percent on a property that is not stabilized. A clean stabilized asset might support 5 percent, but a property mid-lease-up does not.
• Repairs and maintenance understated on older assets. Older buildings cost more to keep running, and the seller's number often does not show it.
• A thin advertising budget. Underfunded marketing makes the pro forma look cheaper to run than it will be.

Be careful with a strong T12 too. A great trailing year can come from temporary conditions, and copying it forward overstates the future. Compare steady year-over-year growth against a sudden spike to tell a real trend from a one-time bump.

The gap between the actuals and your pro forma is the value-creation plan. It should be explainable line by line: this is the rent bump from renovations, this is the tax reset, this is the expense you can cut. If you cannot defend the gap, the deal does not pencil at that price.

From the pro forma to running the raise on the deal

Once the pro forma clears, a GP raises against it. That means collecting soft commitments, converting them to signed subscriptions, tracking the cap table, and paying distributions on the cash flow the model projected. The underwriting model is the start of the deal, not the end.

Homebase is the software a GP runs for that investor layer. The deal room, e-signed subscription docs, the cap table, and ACH distributions live in one place. See what a deal room is and how investor reporting and distributions come together. If you are still choosing how to structure the offering, start with real estate syndication structures.

The GP keeps their property accounting in Rent Manager or QuickBooks, and keeps their CPA for the K-1s. Homebase handles the investor side, on flat deal-based pricing with no AUM fees.

Frequently Asked Questions

What should a real estate pro forma template include?

A revenue block (gross potential rent, other income, less vacancy and credit loss), an operating expense block by category, net operating income, debt service, and cash flow to equity. It should also output the core return metrics: cap rate, cash-on-cash, DSCR, IRR, and equity multiple over the hold period.

What is the difference between a pro forma and actuals?

Actuals, usually the trailing 12 months (T12), are the property's real historical income and expenses. A pro forma is a forward projection of what you expect to happen. Use the actuals as your baseline and treat the gap between them and your pro forma as the value-creation plan you have to defend.

How do you calculate NOI on a pro forma?

NOI equals effective gross income minus operating expenses. Effective gross income is gross potential rent plus other income, minus vacancy and credit loss. NOI sits above the line, so it excludes debt service, capital expenditures, depreciation, and income taxes.

What is a good vacancy rate to use in a pro forma?

Most underwriters use a stabilized vacancy of about 5 to 10 percent, depending on the market and asset. Be careful copying a seller's 5 percent onto a property that is not stabilized, since that is one of the most common ways a pro forma overstates income.

What hold period should a pro forma model?

Most commercial real estate pro formas project a 5, 7, or 10 year hold. The projection grows rents and expenses each year by your assumptions and ends with an exit value, usually set by applying an exit cap rate to the final-year NOI, which feeds the IRR and equity multiple.

Once the deal pencils, run the raise on it. See how Homebase handles soft commitments, subscriptions, the cap table, and distributions in one place. Book a demo.