What is the Income Approach in Commercial Real Estate?
What is the Income Approach? The Income Approach is a valuation method used by real estate appraisers to estimate the fair market value of a property based on the income it can generate. Under the income approach, the implied valuation is determined by dividing the capitalization rate (or ”cap rate”) by the net operating income (NOI) of […]
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SBA 504 Green Loan: Everything You Need To Know (2021)
Small businesses looking to grow their business can qualify for commercial real estate loans under SBA 504′s Green Loan program. The SBA 504 Green Loan offers up to $5.5 million in financing per project from the SBA. Small businesses can secure multiple SBA 504 Green Loans, each with the maximum of $5.5 million and an aggregate […]
What is the Income Approach in Commercial Real Estate?
What is the Income Approach? The Income Approach is a valuation method used by real estate appraisers to estimate the fair market value of a property based on the income it can generate. Under the income approach, the implied valuation is determined by dividing the capitalization rate (or ”cap rate”) by the net operating income (NOI) of […]
What is a BRIDGE LOAN?
Bridge Loan Definition What is a Bridge Loan? A bridge loan is a short-term loan used to purchase assets or cover immediate costs until long-term financing can be secured. Bridge loans are commonly used by homebuyers to purchase a new property prior to the sale of their current one. REtipster does not provide tax, investment, […]
Differences in the Real Estate Pro Forma for a Multifamily Property
In this tutorial, we’ve focused on a real estate pro forma for a mixed office/retail property. This same pro forma also applies to industrial properties because lease terms, revenue, and expenses are similar. However, there would be some minor differences for a multifamily property (i.e., an apartment building where tenants rent units) because: Tenants are […]
Bridge Loans vs. Construction Loans: What’s the Difference?
Bridge loans and construction loans both are short-term lending options for borrowers who need funds fast. While they are often viewed as the same type of loan because they usually are both funded against the value of an existing property, they are structured for very different purposes. Bridge loans are used during periods of transition, […]
What are “Operating Expenses” in Commercial Real Estate?
Common operating expenses include property management fees, utilities, maintenance, insurance, sales & marketing, general & administrative, property taxes, and reserves. Some are projected based on a % of Effective Gross Income, some are based on $ per square foot or $ per square meter figures, and some are percentages of the property’s value. Property Management […]
Building Your Dream Home: Exploring Financing Options for Building Your Dream Home
Building a house is an exciting milestone in one’s life. It is an investment that requires significant financial resources, and most people will require financing to realize this dream. There are several financing options available in the market, including traditional mortgages, construction loans, and bridge loans. Each option has its advantages and disadvantages, and it […]
