Absorption Rate – The rate at which available units are leased in a market over a given period.
AIV (After-Improved Value) – Estimated property value after renovations.
AM (Asset Management) – Oversight of performance, budgets, CapEx, and strategy post-acquisition.
ARM (Adjustable Rate Mortgage) – Loan with an interest rate that resets after a fixed period.
Bad Debt – Uncollected rent written off due to delinquency.
Basis – Total capital invested, including purchase price and improvements.
Bridge Loan – Short-term debt used during repositioning or lease-up.
Burn-Off Vacancy – Temporary vacancy caused by renovations.
CapEx (Capital Expenditures) – Non-recurring improvements (roofs, HVAC, unit renovations).
Cap Rate (Capitalization Rate) – NOI ÷ purchase price or value.
CoC (Cash-on-Cash Return) – Annual cash flow ÷ total equity invested.
Cost Seg (Cost Segregation) – Accelerated depreciation strategy.
DD (Due Diligence) – Investigation period prior to closing.
DSCR (Debt Service Coverage Ratio) – NOI ÷ annual debt service.
Debt Yield – NOI ÷ loan amount (risk metric used by lenders).
EGI (Effective Gross Income) – GPR minus vacancy and credit loss plus other income.
EM (Equity Multiple) – Total distributions ÷ invested equity.
EMD (Earnest Money Deposit) – Good faith deposit with an offer.
Exit Cap – Assumed cap rate at sale.
Fannie Mae / Freddie Mac – Agency lenders for multifamily assets.
Fee Simple – Full ownership interest in real property.
Float – Cash reserves held for operations or CapEx.
GP (General Partner) – Active sponsor/operator in a syndication.
GPR (Gross Potential Rent) – Maximum rent if 100% leased at market.
GRM (Gross Rent Multiplier) – Price ÷ gross rents.
Hard Costs – Direct construction costs.
Hold Period – Planned duration of ownership.
Hurdle Rate – Return threshold before profit splits change.
IO (Interest Only) – Loan period with interest-only payments.
IRR (Internal Rate of Return) – Time-weighted total return.
JV (Joint Venture) – Partnership between operating entities.
K-1 – Tax form reporting partnership income/loss.
LTV (Loan-to-Value) – Loan ÷ property value.
LTC (Loan-to-Cost) – Loan ÷ total project cost.
LP (Limited Partner) – Passive investor.
Market Rent – Rent achievable at current market conditions.
MSA (Metropolitan Statistical Area) – Market analysis region.
NOAH – Naturally Occurring Affordable Housing.
NOI (Net Operating Income) – Income minus operating expenses.
OpEx (Operating Expenses) – Costs to operate the property.
Opportunity Zone (OZ) – Tax-advantaged investment area.
Pref (Preferred Return) – Return paid to LPs before profit splits.
Pro Forma – Forward-looking financial projection.
PSA (Purchase & Sale Agreement) – Acquisition contract.
Qualified Intermediary (QI) – Facilitates 1031 exchanges.
R&M (Repairs & Maintenance) – Ongoing maintenance expenses.
Rent Roll – Detailed tenant and lease schedule.
REP (Real Estate Professional) – IRS tax status.
Sensitivity Analysis – Stress testing underwriting assumptions.
Stabilized Asset – Fully leased at market rents.
Syndication – Pooling investor capital.
T-12 – Trailing twelve months financials.
TI (Tenant Improvements) – Unit build-out costs.
Unit Mix – Distribution of unit types.
Vacancy Rate – Percentage of unoccupied units.
Value-Add – Strategy to improve NOI and value.
Waterfall – Distribution hierarchy of cash flows.
Workforce Housing – Housing for middle-income renters.
1031 Exchange – Tax-deferred reinvestment of proceeds.
Yield Maintenance – Prepayment penalty based on lender yield.
Zoning – Government land-use regulations.
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