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Financial Models for Tax Credit Projects

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Getting a working model developed is critical to the decision-making process during the planning stages of a real estate project. Financial models are used by the developer and owner for initial determination of financial feasibility. As the model is fine-tuned, lenders and tax credit investors can use it to develop pricing for their tax credit investments. A basic version of the model works well for some circumstances but often an expanded version is needed that includes additional schedules.

The process usually includes:

  • Meeting with key personnel to determine project scope and goals
  • Gathering documents and cost information
  • Constructing the initial model
  • Revising the model
  • Finalizing the version