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What is a Trailing Twelve Months Period?

What is a Trailing Twelve Months Period

The financial performance of commercial real estate property is reported over various periods, including back-looking and forward-looking periods. One of the most common periods when evaluating multifamily properties is the trailing 12-month period, also known as TTM and the most commonly used term T-12.

What is a Trailing 12-Month Period?

The trailing 12-month period is the most recent 12 months. The last full month constitutes … Read More

Gross Rent Multiplier Calculator: How to Calculate GRM?

What is Gross Rent Multiplier and How is it Calculated

Determining which rental property is worth your investment requires carefully looking at various bits of data. The gross rent multiplier in real estate happens to be one of the most important factors you may wish to focus on – and the good news is there are many such metrics you can use to get a good idea of the value of any property.

First Things … Read More

What is Equity Multiple in Commercial Real Estate?

What is Equity Multiple in Commercial Real Estate

Equity multiple represents the absolute return of an investment. It’s widely used in private equity and commercial real estate as a litmus test. There are fewer quick ways to calculate the potential or actual total return of a property (or deal).

What Does Equity Multiple Mean?

Equity multiple demonstrates, in a straightforward way, the total return that investors will receive on their total investment. It’s … Read More

Are Commercial Loan Origination Fees Negotiable?

Are Commercial Loan Origination Fees Negotiable

Lenders charge a variety of fees when underwriting commercial real estate loans. One of the most common commercial loan fees and charges is the loan origination fee.

What Are Loan Origination Fees?

Loan origination fees are charged to cover the overhead associated with actually originating a loan.

Origination encompasses the entire process of entering into a loan agreement, from initial application to final signing. The … Read More

Cash on Cash Return vs IRR: Understanding the Difference

Cash on Cash Return vs IRR Understanding the Difference

For commercial real estate investors, having access to as many metrics as possible to provide insight and comparison opportunities is critical. There are various metrics available, including cash on cash return and internal rate of return, both of which enable investors to create a more even comparison between properties when trying to decide which to choose for investment.

Most investors set their own threshold of … Read More

What Does Triple Net (NNN) Property Mean? What to Look For?

triple net properties

Triple net properties, sometimes called NNN, are a form of commercial real estate. Those considering the investment in these properties should understand what this term means and how it applies to their situation.

What Does Triple Net Mean in Commercial Real Estate?

A triple net lease is a type of commercial lease that includes a provision that the lease remains responsible for covering some of … Read More

Gross Lease vs Net Lease: What’s the Difference?

gross rent vs net rent

A variety of commercial leases are available. This helps ensure there is something available to fit any need and most challenges.

There are two main types of commercial leases. The first is a gross lease, and the second is a net lease. It is also sometimes called gross rent vs net rent. The type determines who pays for various expenses associated with the use of … Read More

What is a Commercial Property Appraisal? What Does it Cost?

commercial property appraisal

Accurately assessing a commercial real estate property’s value is essential for multiple reasons. Buyers, sellers, lenders, and tax authorities all need to know how much a property is worth, so they can accurately price, underwrite and tax the property. Getting a commercial property appraisal is the industry-standard way to value commercial real estate properties.

What is a Commercial Property Appraisal?

The role of a commercial … Read More

FHA Loan Eligibility: FHA Loan Requirements Explained

fha loan eligibility requirements

What Is an FHA Loan?

An FHA loan is a type of government-based secured loan. It’s issued by the Federal Housing Administration (FHA). With this type of program, qualified borrowers can access a loan with potentially lower interest rates and with fewer restrictions. FHA loans are underwritten and administered by third-party lenders, though the federal government backs them.

Types of FHA Loans

To … Read More

What is a Mezzanine Loan in Real Estate, and How Does It Work?

real estate mezzanine loan

Acquiring new commercial real estate is capital-intensive, and sometimes investors need more capital than they can obtain through primary loan programs. Investors may be able to raise more capital through dilution — or they might take on a mezzanine loan. Here’s what a mezzanine loan in real estate is.

What Are Mezzanine Loans in Real Estate?

Mezzanine loans provide subordinate financing for new real estate … Read More