Glossary

Cap Rate : Capitalization Rate which represents the ratio between the effective net income and the sale price.

NIM : Net Income Multiplier, indicates how many times the net operating income represents the cost of acquiring the property

DCR : Debt Coverage Ratio, used to judge the ability to repay a debt from the net income generated by the property

MOR : This ratio indicates the level of occupancy required to meet the financial and operating obligations. It is the Break Even Point.

ROI : Ratio of the sum of cash flows and equity generated divided by the total down payment, over a 10-year period

Total down payment : Corresponds to the down payment required by the bank and the related acquisition costs

Economic Value : the value of the property taking into account income and expenses, the interest rate and the debt coverage ratio

Net Cash Flow : Residual liquidity after all obligations and operating expenses are paid, including the mortgage

IRR : Internal Rate of Return, a ratio that takes into account the purchase price, the discounting of all net cash flows and the net proceeds of the sale of the property

CoC : Cash on Cash, ratio of the sum of cash flows to the total down payment over a 10-year period

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