Interest Reserve Calculator
Estimate construction interest reserve from facility size, draw profile, rate and duration.
Calculated directly from the assumptions shown.
Continue in the full model.
Move from this screening result to the complete Construction Financing Model.
Get the model · €49 incl. VATHow the Interest Reserve calculation works
Reserve ≈ facility × average utilisation × annual rate × months ÷ 12.
Example calculation
A €10m facility at 50% average utilisation, 7% annual interest and 24 months implies about €700k of interest.
How professionals use the result
Use this as a screening estimate. Monthly draw timing and capitalised interest can create circularity in a full model.
Common mistakes
- Applying interest to the full facility
- Ignoring draw timing
- Compounding without stating it
- Including the reserve in the base twice
Interest Reserve Calculator FAQs
What does the Interest Reserve calculator measure?
Estimate construction interest reserve from facility size, draw profile, rate and duration.
What formula does the Interest Reserve calculator use?
Reserve ≈ facility × average utilisation × annual rate × months ÷ 12.
Is the result suitable for a final investment decision?
Use it as a transparent screening calculation. Validate deal-specific tax, timing, financing and legal assumptions in a complete underwriting model before making a decision.
Do I need an account?
No. The calculator is free and runs in your browser. FormulaPlanet does not store your projects, inputs or results.
Is any input sent publicly?
No calculation is public by default. A shareable link is only created when you explicitly choose to copy one; that link contains the assumptions shown in its URL.
Why might my spreadsheet give a different answer?
Differences usually come from timing, compounding, sign conventions, fees or a different definition of the numerator or denominator. Match every period and definition before comparing.
What should I review alongside this result?
Use this as a screening estimate. Monthly draw timing and capitalised interest can create circularity in a full model.
Which mistakes are most common?
Applying interest to the full facility; Ignoring draw timing; Compounding without stating it; Including the reserve in the base twice.