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Bayfield Training - Retail Property Appraisals

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United Kingdom

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Learn how to build a Retail Property cash flow model. This course takes delegates step by step through the creation of a full shopping centre cash flow model. As a modelling course, it is almost entirely Excel based. The course starts by analysing the variables that influence shopping centre investment returns. Delegates will calculate Key Performance Indicators (KPIs) that can be shown to influence the financial model from Tenancy through to Risk.

The KPIs are studied, calculated and ranked using a portfolio of 10 real shopping centres. The first day will also revise the Excel techniques and Financial Mathematics required to build the case study.

On the second day the Tenancy Schedule will be analysed, the Cash Flow built and Investment Returns calculated. Finally, the model is tested by altering the variables and conditions in the tenancy schedule. Sensitivity and scenario analysis will help delegates appraise and find strategies to optimise their retail property investment. By the end of the course, delegates should be able to build their own shopping centre investment cash flows and analyse the results.

Who will benefit from this course?

  • Asset managers and fund managers who would like to understand the impact of their strategies on asset and shareholder value in a more granular and integrated fashion.
  • Suppliers to shopping centres to help them quantify and communicate how their product can add value.
  • Analyst and modellers who would like to improve their understanding of financial models in respect of retail property assets.
  • Mid-level to senior Real Estate Analysts who would like to advance their financial modelling skills

Day One

Collating and sorting Retail Property Data

  • Retailer Classification within sample
  • Catchment areas analysis within sample
  • Operational metrics within sample

Retail Property Analytics

  • Analysis of vacancy and appropriateness of tenant mix
  • Catchment versus operational dimension analysis
  • Fragmentation, clustering and co-location analysis
  • Sustainable Metrics

Analytics and Value

  • Understanding the interaction between Retail Property KPIs and their impact on asset level returns: Footfall, Threshold, Engagement and Conversion
  • The mathematics of optimising Retail Property KPIs

Retail Property Appraisals

  • Turnover, affordability ratios and rental capture
  • Rental Growth, inflation and fixed rent
  • Financial model layout
  • Retail Tenancy Scheduled and ITZA calculations
  • Rent Functions and rental projection
  • Service Charges and Operational Expenditure (OPEX) and Capital Expenditure (CAPEX)
  • Project Financing
  • Internal Rate of Return (IRR), Net present value (NPV) and other metrics


  • Macroeconomics impacts on retail property KPIs
  • Sensitivity analysis
  • Resilience through demographic change and different stages of the business cycles

Round up and Conclusions of Day One

Day Two

Shopping Centre Case Study

  • Delegates are presented with a leased shopping centre, location, catchment information and a schedule of leases
  • The trainer will facilitate a discussion on location, catchment, shopping centre design and leasing strategy
  • Delegates will then be required to enter the tenant information into an Excel template

Tenancy Schedule Analysis

  • Analyse the tenancy schedule of the case study shopping centre using the visualisation techniques and metrics learned in day one
  • The centre will be ranked according to the various metrics and benchmarked

Full Project Cash Flow

  • Techniques for planning complex functions
  • Building a rent function for the case study shopping centre
  • Testing the rent function
  • Creating CAPEX and OPEX functions for the case study
  • Calculating IRR, NPV and other Investment Metrics
  • Testing the IRR for errors

Risk Analysis of Retail Property Appraisals

  • How resilient is your leasing strategy to the scenarios presented?
  • Has your shopping centre performed within expectations
  • Which solutions might you propose to help maintain the value of your centre?

Round up and Conclusions of Day Two

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