Where the sample deal page's numbers come from

• IRR, on dated cash flows

  15.16%

  a year, to an investor, monthly dates

  What it measures. Annualized rate of return on dated cash flows, computed on the model's monthly dates (XIRR).

  Limitation. Sensitive to early distributions. Two deals can share an IRR with very different dollars behind it, so it is read with the multiple.

• Equity multiple

  2.73x

  back, per dollar in

  What it measures. Total distributions over total contributions.

  Limitation. Does not account for time. The same multiple over five years and over fifteen reads identically; the IRR covers timing.

• Cash-on-cash

  5.7%

  average operating year, on full equity

  What it measures. Income during the hold: a year's operating distributions over the equity.

  Limitation. On a development it is zero until delivery, then builds: 7.2% in the first distributing year here. A stabilized acquisition distributes from the first year, which is one reason its IRR can be lower at similar risk.

• Distribution mix

  13% · 25% · 62%

  operations · refinance · sale

  What it measures. The share of distributions from operations, the refinance and the sale.

  Limitation. A return concentrated in the exit depends on the exit assumptions. On this deal 62% of distributions arrive at the sale.

Two related measures. MIRR assumes distributions reinvest at a stated rate rather than at the deal's own rate; allocators use it to rank deals, and the engine will quote it when it lands. And the sponsor's version of the cash flow question: on this deal the sponsor's operating income is the stated fees in the terms, because the waterfall pays the promote only at the sale. Structures where the sponsor shares current cash after the preferred return exist; that is a term sheet choice a standardized model can price, not a different metric.

The page's own ground-up development: dark through construction, the refinance in year six, the sale in year ten. Its vectors are the cash flow table above, so this column reconciles with the whole page.

Equity in

$18.3M

all capital calls

Cash back

$56.4M

every distribution

Equity multiple

2.73x

the model's figure, as on the deal page

Investor IRR

15.16%

the model's figure, as on the deal page

Capital back

year 10

through tier two

Sponsor share

13.2%

$7.5M promote

All but the first of these deals are illustrations, stated as nothing but their capital-in and cash-out vectors; every figure above is derived from those vectors by the same five tier rules. The other deals' IRRs and multiples use one annual end-of-year convention. The sample deal shows the model's own 15.16% and 2.73x on monthly timing, the figures the deal page quotes.

Everything, operating cash and events alike, walks one staircase: preferred return, all capital back, then the promote tiers. The sponsor's first profit dollar waits for the sale.

Sponsor's first cash

year 10

beyond fees

Sponsor before the sale

$0.0M

operating years' promote

Sponsor total

$7.5M

whole hold

Investors total

$49.0M

whole hold

Investors' share

86.8%

of everything distributed

Why this deal's own waterfall pays the sponsor nothing during operations, in one sentence: its operating cash runs near 7% of equity in a good year, below the 8% preference, so any structure that pays the pref before splitting leaves nothing to split, and the current-pay shape exists precisely to route sponsor income around that. The sponsor's operating income under this deal's actual terms is the fee schedule in section seven. On a live listing, this choice is the sponsor's to make in the listing builder, priced in front of investors exactly like this.

Programs, not projections. These are the programs' own rules applied to a sample, stated so they can be understood, and they are not tax advice. The K-1 reports the actual numbers, and whether any benefit applies depends on each investor's own gains, basis and state.

The gap in this illustration is $725,821 per $1,000,000 of reinvested gains, and all of it comes from the tax treatment: both sides hold the same deal at the same multiple. Assumptions are on the table: a 23.8% federal rate on long term gains including net investment income tax, state tax excluded, and the deferred tax on the original gain paid in full on the fund path. The deferral timing changed under the 2025 law and belongs to each investor and their advisor.