Overview · What & why
A decision, before a calculation.
A project can have one economic result and several partner-level returns. Fees, timing, capital shares and distribution priorities make each partner’s cash-flow pattern different. Calculate returns from that partner’s contributions and receipts, then reconcile all partners back to the project’s distributable cash.
A concrete example
In the one-year example, the investor contributes $1M and receives $1.416M, a 1.416× multiple and 41.6% one-year return. The sponsor receives $84K without modeled capital; its percentage return is undefined in that example.
What to remember
Reconcile partner cash first; calculate partner returns second.
Before using this in a project: Capital ledger, dated distributions, separately identified fees and signed agreement definitions.