Equity Multiple

In commercial real estate, the equity multiple shows how much money you could make on your initial investment. It's calculated by dividing the total cash distributions received from the investment by the total amount of money you put in.

If the equity multiple is less than 1.0x, it means you're getting back less cash than you invested. If it's greater than 1.0x, you're getting back more cash than you invested. For example, an equity multiple of 2.50x means that for every $1 you invest in a commercial real estate project, you could expect to receive $2.50 back in cash distributions.