Model how changes in exit (reversion) cap rate affect sale price and total return. A 50bps cap rate expansion can reduce exit price by 8–10% on a 5% going-in cap property.
Enter the values for the scenario you are assessing. Model how changes in exit (reversion) cap rate affect sale price and total return. A 50bps cap rate expansion can reduce exit price by 8–10% on a 5% going-in cap property. Use the reversion cap sensitivity result to inform your calculation.