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Are CAP Rates Good for Commercial Space?

Capitalization rates, or CAP rates, are analyzed to provide both a buyer and a seller with some basic information on how commercial real estate value is based on the interest income that is generated by the property per year relative to the net investment. Although these valuations are only an estimate and may fluctuate from day-to-day based on real estate stocks, there is seldom a factor that is as debatable as the CAP rate when deciding to buy or sell commercial real estate.

REIT Firms Set for Acquisitions .

Real-estate investment trusts raised a record-breaking amount of equity in 2011, which analysts believe will be used to pursue acquisitions.

CASH FLOW AND THE VALUATION OF REAL ESTATE INVESTMENTS

Real estate investments are sometimes valuated based on prices of comparable properties or on the adjusted construction cost to construct a property. Investors are more prone to look at the Cap Rate (capitalization rate or overall rate). The Cap Rate is the rate at which a stream of payments over time convert to an amount of capital.

Cash Flow Tips

Business owners have been cutting expenses, reducing payroll, and trying to chase down new sources of cash flow for two years. Yet, as the economic recovery lags, many realize they need to do even more. But what is left to cut? Where can they find new streams of revenue?

Corporate Executive Optimist

In a recent article in Commercial Investment which is a monthly magazine of the CCIM Institute, David Rifkind describes himself as a CEO—Corporate Executive Optimist.

Will Mobile Wallets Kill Bank Branches?

The convenience of the “mobile wallet” for making payments and accessing bank accounts from anywhere, at any time, could change the definition of “banking hours” — and the need for bank branches. In a recent Deloitte LLC video presentation, Brian Johnston, principal, Deloitte Consulting LLP, said that, “Out of the top 25 banks, I am not sure that there is one out there that doesn’t have some type of focus or initiative in place right now on the mobile channel.”