MOIC is calculated by dividing the total cash flow received from an investment by the initial amount of invested capital.
A defeased bond is a bond that has been rendered essentially risk-free. This is done by setting aside sufficient assets in a trust to cover all future payments of principal and interest.
In real estate, "unsubordinated" refers to a debt or lien that holds priority over other claims on the same property.
In real estate, HTC often stands for Historic Tax Credit, a powerful tool for property owners and investors.
Protective covenants are legally binding agreements that aim to preserve property values and ensure a cohesive community appearance.
They set specific limitations on how a property can be used, directly affecting activities, development potential, and even aesthetic choices for homeowners.
Prime real estate typically refers to properties that are situated in desirable locations. They offer high investment potential due to factors such as excellent amenities and strong market trends.
The primary function of a single purpose entity is to isolate financial risk and secure the real estate asset it holds.
This credit line is secured against the equity of commercial real estate, allowing the owner to borrow up to a preset limit.
Gross area refers to the total floor area within a building, including walls and shared spaces, whereas net area focuses on the usable space, excluding non-usable sections like walls and shafts.
By calculating the employment share of a specific industry within a local area and contrasting it with the national share, a location quotient reveals the concentration of that industry in the regional economy.
In commercial real estate, CAM reconciliation is crucial for maintaining financial transparency between landlords and tenants who share common areas.
It enables property owners to transfer their real estate assets into a publicly traded REIT in exchange for operating partnership units.
A Credit Tenant Lease is a long-term lease agreement where a property owner leases to a tenant who possesses superior credit. Often, the tenant is a major corporation, ensuring that the rents are perceived as reliable as corporate bonds.
The MOIC formula is calculated by dividing the total cash inflows from an investment by the initial capital invested.
Soft costs in construction can make up a significant portion of the overall budget, ranging from 5% to as much as 50% of a project’s hard costs.
TEBS enables the creation of a tax-advantaged income stream while providing essential liquidity and support to multifamily housing projects.
A non-recourse loan offers a unique structure. In this loan type, the lender's remedy in case of default is limited to the collateral associated with the loan, rather than pursuing the borrower's other assets.
The master servicer is fundamentally responsible for handling the day-to-day operations of a loan portfolio.
The primary goal of a lender inspection is to protect the lender's financial interests by verifying that the property meets specific standards and poses no significant risk.
Defined by the U.S. Census Bureau and the Office of Management and Budget, an MSA encompasses a region with a significant population density and strong economic integration.
These capital contributions are often necessary in private equity and real estate investments to cover unforeseen expenses or to fund additional opportunities that arise after the initial investment.
The Gross Rent Multiplier (GRM) is calculated by dividing the property value by its gross rental income. This offers insight into how long it might take to recover the property's cost through rental income.
A special servicer is responsible for managing non-performing loans. They focus on maximizing recovery for investors or lenders.
This process is essential to determine whether a piece of land can be developed as intended, impacting both project viability and property value.
