Equity Multiple
What is Equity Multiple as it Applies to Real Estate?
Equity multiple is a financial metric that measures the total return on an investment relative to the initial investment. It's calculated by dividing the total cash distributions received from the investment by the total equity invested. An equity multiple greater than 1.0x means the investor is getting back more cash than they invested, while an equity multiple less than 1.0x means the investor is getting back less cash than they invested. Equity multiple is typically another key metric for investors to evaluate and compare investments.
Equity Multiple Formula
Equity Multiple = Total Cash Distributions / Total Equity Invested
Related Terms
Additional Reading
- Decoding Real Estate Return Metrics
- View the Equity Multiple performance of deals that have realized on our Marketplace
