Calculate total return on invested equity. See how many times your initial investment comes back to you through cash flows and sale proceeds over the entire hold period.
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Want to structure deals for higher equity multiples? Our advisors optimize financing to maximize total returns.
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The simplest way to measure total investment performance.
Equity Multiple = Total Cash Received ÷ Total Cash Invested. A 2.0x EM means you got back $2 for every $1 invested. Unlike IRR, EM doesn't account for time — a 2.0x over 3 years is much better than 2.0x over 10 years. That's why investors use both EM and IRR together.
EM tells you the total magnitude of return. IRR tells you the annualized rate. A 2.5x EM over 5 years ≈ 20% IRR. A 2.5x EM over 10 years ≈ 10% IRR. Same multiple, very different time-adjusted performance. Always evaluate both metrics together.
Core: 1.3–1.6x over 5–7 years. Core-Plus: 1.5–1.8x. Value-Add: 1.8–2.5x over 3–5 years. Opportunistic: 2.0–3.0x+. Fund investors and LPs typically look for minimum 1.5x over the fund life (7–10 years).
Every calculator we offer, in one place — run the next number your lender will ask about.
Common questions about equity multiples in CRE.
A 2.0x or higher over a 5-year hold is generally considered strong. For core deals, 1.4–1.6x is typical. Value-add targets 1.8–2.5x. Opportunistic deals aim for 2.0–3.0x+. The target should reflect the risk level — higher risk demands higher EM.
ROI = Profit ÷ Investment. EM = Total Received ÷ Investment. A 2.0x EM = 100% ROI. They measure the same thing differently. EM is more common in CRE because it includes return OF capital (getting your money back) plus return ON capital (profit).
No. That is its main limitation. A 2.0x over 3 years is much better than 2.0x over 10 years, but the EM is identical. Always pair EM with IRR. Together they give you both magnitude (EM) and time-adjusted rate (IRR) of return.
The biggest drivers are: (1) exit value at sale — appreciation has a huge impact, (2) annual cash flow during hold period, and (3) leverage — higher leverage amplifies EM because you invest less equity for the same total returns. But leverage also amplifies losses.
More leverage = higher EM because the denominator (equity invested) is smaller. A $1M property with 25% down ($250K equity) that returns $600K total = 2.4x EM. Same property with 35% down ($350K equity) returning $700K = 2.0x EM. Less equity invested, higher multiple.
We optimize your financing to maximize returns — finding the right balance of leverage, rate, and structure. Higher LTV with reasonable DSCR, interest-only periods, or SBA programs can significantly boost your equity multiple on the same deal.
Our advisors structure deals to maximize your equity multiple through optimized financing, value-add strategies, and timing.
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