Exit NOI
Year-of-exit NOI built off the operating cashflow, with escalation and capex baked in.
Use case · investment
The value the asset prints at exit.
Popurise will model the exit: NOI at the exit date, terminal cap rate, transaction costs and the contribution of exit value to the equity IRR. One project carries the development, the hold and the exit.
The job
Exit value as a model output, not an assumption.
The exit is the largest single cashflow event in an investment. Popurise will compute it off the exit NOI and a defensible cap, not as a top-of-the-head growth assumption.
Terminal cap rate
A defensible exit cap rate by asset class and submarket, with a band, not a single point.
Gross exit value
Exit NOI divided by the terminal cap, the headline asset value.
Transaction costs
Sale costs, capital gains and other transaction drag netted off the gross.
Net exit value
The cash the investment receives at exit, the number that flows into the IRR.
IRR contribution
The portion of equity IRR delivered by the exit, called out explicitly.
When it matters
The decisions that hinge on the exit number.
Fund close
Fund life ends in year seven. The exit value sets the closing return number.
Capital partner pitch
LP wants to see the assumed exit, the cap rate sensitivity and the IRR contribution.
Refi versus sell
Asset stabilises. The exit value tells you whether to refinance and hold or sell.
Market timing review
Cap rates compress. The exit value tells you whether to bring the sale forward.
Inputs and outputs
From hold-period NOI to exit value.
Inputs that drive it
- Year-of-exit NOI (from operating cashflow)
- Terminal cap rate central and band
- Escalation profile across the hold
- Capex reserve and refurbishment timing
- Sale transaction costs
- Capital gains and other transaction drag
- Exit year and hold period
Outputs that matter
- Exit NOI
- Gross exit value at the central cap
- Exit value band across the cap range
- Net exit value after transaction costs
- Exit yield (initial yield to the buyer)
- Contribution of exit to equity IRR
How it will work
From hold period to exit, in four steps.
- 01
Carry the hold-period NOI forward
The operating cashflow produces a year-by-year NOI. The exit reads from the exit year.
- 02
Set the terminal cap evidence
Pick a central cap rate and a band based on the asset class and submarket.
- 03
Net off transaction costs
Sale costs, capital gains and other drag are netted off the gross exit value.
- 04
Read the IRR contribution
See how much of the equity IRR comes from the exit and how much from operating cash.
Versus the alternative
Exit value computed off real assumptions.
Workbook exit
A single growth assumption
- Exit assumed as 'cost plus growth', not as NOI over cap
- No structured way to flex the cap rate
- Transaction costs netted by hand, often forgotten
- IRR contribution of exit lost in the headline number
Popurise
Exit in Popurise
- Exit value built from NOI and a defensible cap
- Cap rate band as a first-class input
- Transaction costs structured into the model
- Exit IRR contribution called out explicitly
Be first when exit value goes live.
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