Apartment Development Break-Even Analysis: Month 33 Feasibility

Fixed costs $33.5K/mo Base overhead

Contribution margin 90%-95% After variable costs

Break-even revenue $37.2K/mo Revenue target

Break-even timing Month 33 Model breakeven

Break-even calculator

Test whether monthly revenue can cover variable project costs and fixed overhead in an apartment development.

Lean Base Full

Monthly revenue Revenue drives the cash available to cover variable project costs and fixed overhead. $ Lower sales Higher sales Variable expenses Use direct project costs that rise as revenue grows. $ Lower costs Higher costs

Money available to cover fixed costs $11,100,000 $12,000,000 revenue - $900,000 variable expenses

Margin ratio

92%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly overhead break-even must cover. $ Lean overhead Heavier overhead

Break-even chart Revenue Total costs

Which apartment development expenses are fixed, and which move with sales or project stage?

Cost classification

Break-even is only useful if recurring overhead stays separate from project-stage spending. Here, the model reaches break-even in Month 33, so misclassifying land purchases, construction draws, or fit-out can make that date look safer than it is.

Expense	Cost	Break-Even Treatment	Common Mistake
Corporate office lease	Fixed	Use $15,000 per month from Month 1 through Month 60.	Spreading this into project budgets instead of monthly overhead.
Corporate utilities and IT	Fixed	Use $2,500 per month as base corporate overhead.	Treating normal office IT as occupancy-driven property expense.
Professional services	Fixed	Use $7,000 per month for legal, audit, and tax support.	Confusing recurring advisory retainers with one-time deal closing fees.
Software, insurance, compliance, and travel	Fixed	Use $9,000 per month: $4,000 software, $3,000 compliance, and $2,000 travel.	Dropping smaller fixed items because each one feels immaterial.
Payroll	Semi-fixed	Step up from about $51,700 per month in Year 1 to about $115,800 per month in Year 3.	Modeling headcount as a smooth percentage of revenue.
Project-related operating costs and partner reporting	Variable	Apply revenue-linked rates: project costs fall from 8.0% to 4.0%, and partner reporting falls from 2.0% to 1.0%.	Using one flat percentage across all five years.
Leasing, maintenance, utilities, and property management	Semi-variable	Split any modeled property-level base charge from the part that rises with occupancy.	Treating occupancy-linked property work as fully fixed overhead.
Stabilized monthly break-even bucket	Fixed	Keep recurring corporate overhead separate from land, construction draws, and fit-out.	Mixing purchase costs, construction budgets, and one-time fit-out into operating break-even.

How does break-even shift from lean lease-up to stabilized full buildout?

Scenario table

In this model, break-even moves mostly with lease-up and collections, because unit count and rent mix aren’t provided. The revenue line runs from about $94.6k in the lean case to $161.4k in base, then $157.2k in the mature case.

Planning assumptions only; lease-up pace, concessions, and stabilized collections can move the break-even line.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean lease-up	$94,600	$9,460	$85,200	90.0%	-$60	Still tight; slow lease-up leaves almost no cushion.
Base stabilized	$161,400	$12,105	$149,300	92.5%	-$5	At the line; small misses in collections push it under.
Full stabilized	$157,200	$7,860	$149,300	95.0%	$40	Near break-even with a bit more room from stronger collections.

What breaks the break-even plan if lease-up slows or costs creep up?

Stress test

Year 3 needs about $161,400 a month to cover roughly $149,300 of fixed overhead at a 92.5% contribution margin. A 10% revenue dip, a 3-point rise in variable costs, or a 10% fixed-cost increase can each push the plan back into the red.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$161,400/mo	$0 cushion	Any slip below this line turns cash burn back on.
Revenue shortfall	Revenue runs 10% below the base case.	$161,400/mo	$14,900 gap	Slower lease-up or concessions can erase the cushion fast.
Fixed-cost increase	Fixed overhead rises 10% to about $164,230 a month.	$177,700/mo	$16,300 gap	Property tax, insurance, or admin creep raises the hurdle.
Margin pressure	Variable expenses rise by 3 percentage points.	$166,900/mo	$5,500 gap	Maintenance spikes or fee pressure squeeze margin.
Combined pressure	Revenue is 10% below plan, variable expenses rise 3 points, and fixed overhead rises 10%.	$195,600/mo	$34,200 gap	Three small misses can push cash burn back up.

What should the founder verify before locking site control?

Founder checklist

Test the project against the break-even path before you lock site control. This model only works if land basis, build budget, hiring, and cash all hold through the Month 32 trough and the Month 33 break-even point.

1Site basis$73.0M

Check the land basis on the seven-site pipeline before site control, because the listed purchases add to $73.0M and missed pricing hits the full stack.

2Fixed overhead$33.5K/mo

Keep office, software, insurance, and services lean before the first sale or lease, since fixed burn is already $33.5K each month.

3Build budget$178.0M

Lock the full construction budget before breaking ground, and test contractor pricing against the 12 to 18 month build windows so overruns show up early.

4Contribution90.0% Y1

Hold Year 1 variable costs to 10.0% so contribution stays near 90.0% before overhead; otherwise the project needs more exit value just to stand still.

5Payroll ramp$620K to $1.39M

Stage hiring because payroll rises from about $620K in Year 1 to $1.39M by Year 3, and the asset and project roles start after Month 13.

6Cash trough-$222.1M M32

Reserve for the Month 32 cash trough, and keep leasing and reporting ready before stabilization because break-even in Month 33 still trails payback in Month 40.