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Development of a Dynamic Investment Strategy under Alternative Inflation Cycle Scenarios Stephen A. Pyhrr, Waldo L. Born, and James R. Webb Inflation and inflation cycles have been a major underlying reason for the financial successes and failures of real estate investors in recent history. These cycles have complex impacts on cash flow variables and thus on real estate returns and investment values. This study presents a decision framework and operational model to project investment returns for alternative inflation cycle scenarios and demonstrates their application for developing a dynamic real estate investment strategy. A probabilistic discounted cash flow model is designed and used to inflation-adjust each cash flow variable affected. Mathematical relationships are developed for specifying unique cash flow variable linkages and sensitivities, with lead and lag periods consistent with empirical evidence of timing of inflation impacts.