RICS Certificate in Real Estate Financial Modelling

About this this course:

An exclusive programme offered by Cambridge Finance on behalf of the Royal Institution of Chartered Surveyors (RICS), this course covers the main topics related to real estate financial modelling in Excel, leading up to the RICS Certificate in Real Estate Financial Modelling. Delegates will learn how to create robust financial models from scratch, from traditional valuation methods to fully bespoke cash flows.

In line with the RICS financial modelling competency, this certificate will ensure that delegates are able to demonstrate that they can develop and apply property cash flows in Excel in order to provide detailed and reasoned advice on the performance of investment and risks.

Learning outcomes:

  • Construct robust and fully automated multi-tenant property cash flows from scratch
  • Be able to audit third-party cash flows
  • Understand how cash flow inputs and outputs are interlinked and how to test for errors
  • Develop and produce sensitivity and scenario analysis
  • Be able to give investment recommendation based on quantitative methods

Who should attend this course:

  • Professionals in the in industry, particularly analysts in the commercial property investment and capital markets, who need to create financial models from scratch, analyse them and give investment recommendations
  • APC candidates on the Property Finance and Investment or on the Commercial Property Pathway who would like to take Financial Modelling as a competency to Level 2 and 3
  • Real estate professionals who want to advance their financial modelling skills and be certified by the RICS


Duration: 5 days
Location: London
CPD Hours: 30h
Level: Basic to Advanced

Course fee:
RICS Members: £2,325 + VAT
Non-RICS Members: £2,795 + VAT

Next Dates:
23-27 March 2020
20-24 April 2020
18-22 May 2020
15-19 June 2020


The RICS Certificate in Real Estate Financial Modelling course combines three face-to-face modules and the RICS Certificate exam.

Each of these modules can be taken separately; it is however 10% cheaper if you attend the course as one continuous block.

It is necessary to attend at least Module 3 in order to take the RICS Certified Exam.



Day 1

Best practice in financial models

  • Simple tips to help you become an efficient financial modeller
  • How to avoid errors and present your models in a persuasive way

Implicit investment valuation methods

  • Term & Reversion
  • Layer / Hardcore
  • Property yields
  • Defining term and reversionary yields
  • Calculating the equivalent yield

Build your cash flow from scratch

  • Inputs: passing rent, estimated rental value, initial and exit yields, market growth, review cycles and most importantly, target returns
  • Outputs: internal rate of return, net present value and worth
  • Annual and quarterly discounted cash flows: modelling purchase price, passing rent, rent reviews, exit rent and exit price

Gearing / Leverage

  • Adding senior debt “bullet” loan

Analyse the results

  • IRR, NPV and maximum bidding price
  • Data tables & sensitivity analysis
  • Risk visualisation (charts)

Case study:

  • Single-tenant office building in the UK


Day 2

Multiple tenant properties

  • Modelling tenancy schedules and rents forecast
  • Rent reviews, upward-only, break options, lease expiry
  • Modelling hypothetical second leases
  • Void period, rent free and estimated rental values

Time-varying rental growth

Net Operating Income Forecast

  • Modelling capital expenditure for refurbishment and operating costs (letting fees, void costs, empty rates)

Investment decision

  • When to accept the project and make investment recommendation

Case study

  • Multi-tenant office building in the UK



Day 3

Capital structure, sources of debt funds & lending criteria

  • Capital structures: debt & equity
  • Explanation of different debt & equity structures
  • Sources of debt fund & lending criteria

Debt covenants & calculations

  • Operational Covenants: asset maintenance, disclosure requirements, insurance and credit line
  • Financial Covenants I: interest cover ratio, debt service coverage, loan to value

Senior debt repayment modelling

  • Interest Only
  • Constant Amortisation
  • Constant Repayment
  • Rolled-Up Interest

Financial covenants modelling II

  • Cash Sweep
  • Cash Trap
  • Revolving Facilities

Case study:

  • Office building debt lending in the UK


Day 4

Development finance

  • Mezzanine finance
    • Modelling mezzanine structures
    • Mezzanine interest and fees

Debt prioritisation

  • Modelling cash flow waterfall
  • Coupon and capital repayment schedule


  • Maximum loan amount based on financial covenants
  • Credit Analysis
  • Stress test
  • Capital adequacy calculations

Case study:

  • Office development lending


Day 5

Overview and brief recap of the following topics:

  • Multiple tenant rent forecast
  • Pro-forma discounted cash flow, including CAPEX and OPEX
  • Debt structures modelling, including senior, mezzanine and financial covenants
  • Financial ratios calculation and analysis
  • Real estate development cash flow modelling
  • Development finance modelling
  • Property fund cashflows
  • Risk modelling and analysis
  • Investment analysis and recommendations
  • 2-hour exam style marked exercise to check understanding. In this exercise you will work independently and with limited assistance to test your understanding of the course and of financial modelling. This exercise will be marked and feedback provided at the end of the course
  • The certificate will be issued upon completion of the week-long course.


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