APPLICATION OF SIMULATION MODELING METHOD TO INCREASING NET OPERATING INCOM FROM REAL PROPERTY
Keywords:strategic real property income management, sensitivity analysis, simulation modeling method, cash flows, net operating income, net present value, grain elevator real property.
The article substantiates the possibility of applying methods for assessing the effectiveness and risks of investing for the analysis of income in the strategic management of real property. The methodical bases of sensitivity analysis and simulation modeling of cash flows of real property income are revealed. The critical factors of costs and revenues affecting net present value of total cash flow from grain elevator real property object have been revealed. It is shown that the most significant factors influencing the amount of cash flows are the volume of sales of grain elevator services, to a lesser extent the total costs and the lack of sensitivity of net present value to staff salary variations. Simulation modeling of the change in net present value due to the change of the most significant uncertain factors was performed, which confirmed the assumptions about the efficiency of the investigated real property. The expected profitability of grain elevator real property is largely determined by the factor of the volume of sales of basic services (storage, drying, shipment and transport of products). This creates the preconditions for the subsequent assessment of the value of grain elevator real property on the basis of the methodology of the income approach.
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