Real Estate Flashcards
How do you calculate unlevered free cash flow from Operating Income?
Operating income - (total operating expenses + cap ex + TIs + Leasing Commissions)
How do you calculate Levered Cash Flow?
uFCF - (interest payments + participation + amortization)
What is the Debt Coverage Ratio (DCR)?
NOI/Total Debt Service expense
How do you calculate Cap Rate?
Stabilized NOI / Value; (Capt rate is the inverse of hte multiple. i.e. Cap Rate = .08 = 8% = 12.5 multiple (100/8)
What’s an IRR?
IRR is the annual rate that generates an NPV of zero for a stream of cash flows
What’s Net Present Value?
NPV = Initial costs + PV of all future cash flows; An NPV of ‘0’ = Initial costs + PV of all cash flows using IRR as the discount rate
What’s the Interest Coverage Ratio?
property NOI divide by annual interest payment
What’s the fixed chargees ratio?
property NOI divided by all fixed charges incurred annually
How do you calculate the Room Nights Available?
total Room supply * 365
How do you calculate Room nights sold?
occupancy * room nights available
How do you calculate Room Revenue?
Room nights sold * Average Daily Rate (ADR)
How do you calculate Occupancy?
Room nights sold / room nights available
How do you calculate ADR
Room Revenue / room nights sold
RevPar?
Room Reveneu / room nights available; or occupancy * ADR
