Revenue and Effective Gross Income in Commercial Real Estate
Base Rental Income at the top represents this “potential revenue” with 100% occupancy and full market rents paid by tenants. Simple Calculation: If the property has 10,000 rentable square feet and the market rate is $50 per square foot per year, the Base Rental Income is $500,000. Common deductions and adjustments are ones for the Absorption & […]
Housing Market Predictions For 2024: When Will Home Prices Be Affordable Again?
Thanks primarily to an unexpected rise in mortgage rates, which exacerbated affordability challenges, the spring home-buying season has yet to spring to life. Though newly built home sales are thriving, sales of existing homes, which comprise the lion’s share of the housing market, have stagnated. On the bright side, tepid demand for existing homes is […]
Commercial Real Estate Financing Trends
In the ever-evolving commercial real estate (CRE) financing landscape, understanding the current trends, options, and challenges is crucial for those involved in this dynamic sector. In this article, we will delve into the intricacies of CRE financing, focusing on the needs and opportunities for large institutional investors, particularly in real estate private equity. When You’ll […]
CONSTRUCTION LOANS: WHAT ARE THE DIFFERENT TYPES?
Building a house or remodeling a commercial building – in either case, you’re going to need financing. Construction loans come in many shapes and sizes, but the friendly team at ACOM Capital can help you sort through and find the perfect one for you! Get in touch with our team when you’re ready to talk about construction […]
Construction Loans – Not that Hard!
Every builder wins when they think about getting a construction loan. Well…it doesn’t have to be that way! As a builder, you already know more about your project and what you need than the lender does. You’ve been there, done that. Now, it’s just a matter of zeroing in on a meeting of the minds […]
Bridge Financing Explained: Definition, Overview, and Example
What Is Bridge Financing? Bridge financing, often in the form of a bridge loan, is an interim financing option used by companies and other entities to solidify their short-term position until a long-term financing option can be arranged. Bridge financing normally comes from an investment bank or venture capital firm in the form of a loan […]
Big banks are more at risk of a commercial real estate meltdown than people think, new study says
Big lenders are more exposed to commercial real estate than it might seem at first glance, a study says. In addition to lending to property owners, big firms also offer indirect lending to REITs, raising their exposure by about 40%. Wall Street has been worried about distress in commercial real estate amid high interest rates. […]
Real Estate Pro-Forma for Hotels
The Pro-Forma for a hotel is quite different and much more like the Income Statement of a normal company, with Revenue split into Rooms and Food & Beverage and Expenses split into Fixed vs. Variable categories. Sales & Marketing and G&A may be much bigger, there will be management compensation and bonuses, and NOI margins […]
What are the Sources and Uses in Construction Loans?
The Sources and Uses of Funds is a table summarizing the total amount of funding required to complete an M&A transaction, such as a leveraged buyout (LBO). How to Calculate Sources and Uses of Funds Under the specific context of a leveraged buyout (LBO), the sources and uses of funds table lists the total cost of acquiring […]
