This refers to accounts that are set for individual sponsors or other investors for real estate investments, where a firm then acts like an adviser in procuring and operating a direct real estate portfolio.
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Gross Operating Income
Meaning a total income that is generated by the functionality of a site before the operating expenses. To calculate it, take the gross potential income plus any other income that is affected by vacancy and subtract the estimated...
Class A Building
Part of the BOMA building classification system, These buildings are often the most prestigious buildings that compete for premier office users with above-average rental rates. They are located in an area with high-quality...
Industrial Service Area
This is the territorial area within a market that comprises an acceptable amount of employees or the type of services and resources required to sustain a industrial facility or activity.
Credit enhancement
This refers to credit support required on top of the mortgage collateral. It is done to attain a desirable credit rating on mortgage-backed securities. Credit enhancement comes in the form of over-collateralization...
First-generation space
This is a new space that is presently available for lease. It typically has never been occupied by a tenant before.
Crystallization
This is a clause found in a joint real estate venture agreement wherein both parties agree to share the ownership share in their venture at a specified point in the future. The purpose of partnership crystallization is to allow...
Dividend
This refers to either cash or stock distribution that is paid to the holders of common stock. Real estate investment trusts (REIT) are obliged to pay at least 90% of their taxable income in the form of dividends.
External Obsolescence
This is a factor that significantly decreases the value of an improvement because of external forces. It is often due to something outside of the home or property that is causing the value to decrease. An example of this is a...
Deed of Trust
This is an agreement between a borrower and a lender wherein the mortgaged property is conveyed to a third neutral party to be utilized as collateral while there is an outstanding mortgage. The third party is usually a title...
