Force Multiplier Engine
See how strategic capital stacking amplifies returns. Model how $10M equity becomes $50M+ buying power through layered financing. Adjust leverage ratios to find the optimal structure that multiplies success for sponsors and investors.
Property Details
Set the acquisition price and capital structure
$50,000,000
Capital Stack (LTV %)
Adjust leverage ratios for each layer
65%
$32,500,000
15%
$7,500,000
10%
$5,000,000
Common Equity10.0%
$5,000,000
Return Assumptions
Set interest rates and return targets
Capital Stack Summary
Total capitalization breakdown
Senior Debt
65% LTV @ 7.5%
$32,500,000
Mezzanine Debt
15% LTV @ 12.5%
$7,500,000
Preferred Equity
10% LTV @ 15% pref
$5,000,000
Common Equity
10.0% @ 20% IRR
$5,000,000
Total Capitalization
$50,000,000
Annual Debt Service & Returns
Year 1 cash flow requirements
Senior Debt Service$2,437,500
Mezzanine Debt Service$937,500
Preferred Return$750,000
Total Annual Payments$4,125,000
Exit Waterfall (5-Year Hold)
Distribution priority at sale
Sale Proceeds$70,000,000
Less: Senior Debt Payoff($32,500,000)
After Senior$37,500,000
Less: Mezz Payoff($7,500,000)
After Mezzanine$30,000,000
Less: Preferred Return + Principal($8,750,000)
After Preferred$21,250,000
Common Equity Proceeds$21,250,000
Multiple on Common Equity4.25x
Assumptions
• 5-year hold period with 40% property appreciation
• Interest-only payments on all debt (no amortization)
• Preferred equity accrues annually, paid at exit
• No promote or profit sharing modeled
• Excludes closing costs, operating expenses, and taxes