DEVELOPMENT GUIDE
How to Model a Build-to-Sell Project
A build-to-sell model connects construction phasing and unit absorption with sales proceeds, debt sweep and equity distributions.
In this guideWhat the analysis measuresCalculation frameworkUnderwriting reviewHow to use the result
What the analysis measures
Define unit mix, pricing, sales costs, reservation timing, completion and cash collection. Sales should not occur before a deliverable milestone without explanation.
Calculation framework
Phase project cost and calculate monthly funding. If sales sweep debt, cap repayment at available proceeds and the outstanding balance.
Underwriting review
Reconcile completed units, units sold and residual inventory. Avoid creating sale proceeds twice through both monthly sales and terminal inventory.
How to use the result
Review profit on cost, margin on value, IRR, equity multiple, peak equity and downside absorption before setting the land bid.