Calculate exit value for fixed irr using goal seek! Please help!

**CMP.1** · 07-23-2014, 07:58 AM

Hi everyone,

I am running a DCF valuation sheet for a number of commercial Real Estate investments and as part of the exit valuation, I want to add a sale price of the asset that achieves a target IRR (then assign a Macro to a button for this function).

Can I use goal seek to achieve this? For example, I have an exit price of EUR10,000,000.00 for a particular asset which given the current cash flows, achieves an IRR of around 15.5%.

What I would like to assign is a button which when clicked, will give me the price I need to sell at to achieve a 20% IRR (and probably some other buttons for +500bps.

Any help would be greatly appreciated!

Thanks,
Chris

**Hawkeye16** · 07-23-2014, 08:03 AM

You could do a goalseek combined with an IRR function in excel.
You would use IRR as the target and the sale price as the cell to change.

edit: rereading it seems like you have the IRR calculated as well as the CFs. To calculate a new sell price based on a 20% IRR you would just need to apply the 20% IRR to the CFs. No goalseek needed.

**CMP.1** · 07-23-2014, 08:17 AM

Originally Posted by Hawkeye16

You could do a goalseek combined with an IRR function in excel.
You would use IRR as the target and the sale price as the cell to change.

edit: rereading it seems like you have the IRR calculated as well as the CFs. To calculate a new sell price based on a 20% IRR you
would just need to apply the 20% IRR to the CFs. No goalseek needed.

This is how I set up my Goal Seek scenario however when I specify the cell to change as the sell price, and the target value (selecting the IRR cell) at 20% the sell value remains unchanged; "May not have found a solution".

EDIT - apologies - the cell DOES actually change but when I specify 20%, it returns an astronomical figure as a sale price....