Category: CRE GUIDES

A sublease keeps the original tenant on the hook. Landlord consent, recapture rights, pricing below face rent, and what a subtenant should check.

Percentage rent gives landlords a share of tenant sales above a breakpoint. How breakpoints are set, what counts as gross sales, and reporting rules.

When cap rates fall, prices rise without more income. What drives compression – rates, capital flows, rent growth – and what happens in reverse.

Cap rate measures the property, ROI measures your money. How leverage, time and cash invested change the answer, with side-by-side examples.

Every model assumes an exit cap rate. Why underwriters add spread over the going-in cap, how much, and what a flat assumption hides in your IRR.

NOI ignores your loan, cash flow doesn’t. What sits between them – debt service, capex, reserves, leasing costs – and which number to judge a deal on.

Cash-on-cash measures one year, IRR measures the whole hold and weighs timing. When each metric misleads, and why sponsors always quote both.

Direct capitalization and discounted cash flow explained: how NOI and a cap rate produce value, and when appraisers pick DCF over a simple cap.

Power, cooling and connectivity drive data center value. How leases are priced per kilowatt, who the tenants are, and where the capital risk sits.

Broker pro formas show the best case. Which lines get inflated most – market rent, vacancy, expenses, capex – and how to rebuild them from actuals.

Down payment, closing costs, reserves and lender requirements – how much cash you actually need to buy commercial property, with example numbers.

GRM compares price to gross rent in one step, and ignores expenses, vacancy and lease structure. When the shortcut works and when it misleads.

Debt yield divides NOI by loan amount and ignores rates and amortization. Why lenders trust it over DSCR or LTV, and what thresholds they apply.

WALT weights each lease’s remaining term by rent or area. How to calculate it, what a long or short WALT signals, and how buyers price the difference.

DSCR divides NOI by annual debt service. The formula, what lenders include, a worked example, and the minimum ratios lenders typically require.

Cash-on-cash return divides annual pre-tax cash flow by cash invested. The formula, a worked example, and what actually counts as cash in the deal.

Build the cash flow line first, then solve for IRR. A worked example with acquisition, annual cash flow and sale proceeds – plus IRR’s blind spots.

The cap rate formula with a worked example: find NOI, divide by price, and avoid the mistakes that make a property look cheaper than it is.

Start with gross potential rent, subtract vacancy, add other income, subtract operating expenses – a line-by-line NOI calculation with real numbers.

The clauses worth fighting for: rent and escalations, free rent, TI allowance, renewal options, exclusivity, assignment and personal guarantees.

How hotels differ from leased property: ADR, RevPAR and occupancy, franchise and management agreements, capex reserves and cycle sensitivity.

Self-storage economics explained: unit mix, occupancy and rate management, low capex, third-party operators and what really drives facility value.

Where off-market deals really come from: broker relationships, direct owner outreach, data lists and county records – with outreach tactics that work.

Vacancy, rollover, interest rate, liquidity and capex risk – the main ways commercial real estate deals lose money, and how owners limit damage.