The equity multiple is the total cash an investor receives divided by the cash they invested, across the whole hold. A 2.0x equity multiple means $100,000 invested returned $200,000 in total distributions plus sale proceeds — double the money, before considering timing.
The equity multiple answers "how much," while the internal rate of return answers "how fast." A long hold can produce a strong equity multiple with a modest IRR; a quick flip can show a high IRR with a small multiple. Sophisticated investors weigh both together.
See how EagleCap structures multifamily investments for passive investors.
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