When working with a commercial real estate data set, there are occasions where it is necessary to create a sum for a range of values, but only if they meet certain criteria. Fortunately, there is an easy way to accomplish this task using a built in Microsoft Excel function known as “SUMIF.” In this article, the SUMIF function …
Whether you work at a financial institution, develop real estate, invest in property, or act as a broker, there’s a common thread that binds all facets of the real estate world together. It’s highly likely that you have one or more financial products like a credit card, debit card, deposit account, car loan, commercial real estate …
Imagine you are a mid-level manager at a fast growing small business. As part of the company’s expansion plans, you have been tasked with finding office space in a new city and deciding whether to lease it or purchase it. Fortunately, there is an objective way to make this decision. But, it can be a little …
When real estate investors are evaluating a potential rental property purchase or a bank is underwriting a potential loan, one of the first documents that they will ask for is the property’s “rent roll” or “rent roll report.” In this article, the rent roll document is described in detail and its utility in the CRE due diligence process is highlighted. …
One of the unique challenges of commercial real estate investment is that markets, types of property, return expectations, and physical environments are in a constant state of change. As a result of these changes, a commercial property could be cash flow positive one day and undesirable the next due to shifts in tenant desires or some other factor. …
More often than not, some portion of every commercial real estate transaction is financed with debt. Typically, that debt comes from a bank or non-bank lender who agrees to lend a certain amount of money in return for certain concessions from a borrower. For example, they will almost always require a 1st position mortgage on the property …
Suppose that a medium sized accounting firm is looking to expand its footprint by leasing office space in a new city. After touring several spaces, they have narrowed it down to two options. The options have similar rental rates, but the firm wants to conserve capital so they need to figure out which one is less …
A typical retail shopping center or mall works under a tried and true business plan. The owner and/or developer of the property works first to attract one or more “anchor” tenants and then surrounds them with a variety of smaller tenants who benefit from the traffic they create. Together, the anchor and their supporting tenants …
The development spread is a back of the envelope calculation widely used by real estate developers. It is a fast and easy way to size up the financial feasibility of a real estate development project, before completing a more in-depth analysis. In this article, we’ll take a closer look at the development spread and walk …
In the banking system, a fundamental agreement exists. When a customer opens an account and deposits money, they trust the bank to remain open, making their money accessible for withdrawal when needed. However, history tells us that this isn’t always the case. Throughout history, there is a long list of notable bank failures, the largest …