A building management system includes a controller configured to control building equipment by providing a control input to the building equipment for each of the plurality of time steps and generate a set of training data for a system model for the building. The training data includes input training data and output training data for each of the plurality of time steps. The controller is further configured to perform a system identification process to identify parameters of the system model. The system identification process includes predicting, for each time step, a predicted value for one or more of the output variables for each of a plurality of subsequent time steps, generating a prediction error function by comparing the output training data to the predicted values, and optimizing the prediction error function to determine values for the parameters of the system model that minimize the prediction error function.