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Everything You Need to Know About Cap Rate in Commercial Real Estate
The capitalization rate (cap rate) is used to determine the expected return on investment on a rental property. Cap rate is considered the most important and popular metric for determining a project’s profitability and is widely used throughout the real estate industry. Cap rates, a measure of the income produced by a property relative to its
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How to Improve Your Real Estate Development Process in 2024
The real estate market will have a mixed outlook in 2024, and while economists are hopeful the U.S. will avoid a recession and achieve a soft landing, economic growth remains slow and downside risks will stay high. As a result, investment activity and capital deployment are expected to remain stalled through the first half
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Make Commercial Real Estate Project Management Easier With Northspyre
Real estate project managers take on many responsibilities throughout a complex development project. From managing capital deployment and budgeting to meeting timelines and ensuring zoning or building code compliance, a project’s success is often in the project manager’s hands. Luckily, development software is making commercial real estate project management easier, allowing you to guarantee more
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How to Use Real Estate Project Management Tools to Reduce Admin Tasks and Cut Costs
Project managers are responsible for overseeing many components of a complex real estate development project, ensuring capital is strategically deployed, creating and executing timelines, and navigating the regulatory and zoning process. As a result, project managers are often overburdened with administrative tasks, from managing documentation such as permits, contracts, change orders, or zoning requirements, to
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4 Alternative Capital Sources for Multifamily Development
Capital drives commercial real estate development. It fuels the years-long endeavor—taken without cash flow or revenue—until the project is complete. For the last decade, capital has been readily available at a historically low cost, but now, the tide has turned. With widespread economic uncertainty, rising interest rates and a banking crisis earlier this year, banks
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The Real Estate Developer’s Guide to Yield on Cost
Yield on Cost (YOC) is a financial metric you can use to evaluate the performance and profitability of a real estate investment. By determining your project’s yield on cost, you can measure risk against potential return and compare the asset to other potential opportunities. The yield on cost is unique from other financial metrics in
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Real Estate Due Diligence: Essential Checklist for Commercial Properties
Real estate due diligence is the process that encompasses all the actions that go into investigating and analyzing a site’s potential risks and opportunities before a transaction is finalized. By conducting a thorough diligence process, you can mitigate risk over the lifecycle of a project, get an accurate picture of the project’s financial health, and
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A Functional Guide to Cap Rates in Commercial Real Estate
In commercial real estate investment, there is no metric more prevalent than the cap rate. For transactional real estate investors, it’s a powerful tool used to vet prospective acquisitions, track income gains, and calculate returns. In essence, a commercial cap rate is a measure of return and risk on an investment asset. While we’ve said
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NOI Meaning in Real Estate: Unpacking Net Operating Income
Financial metrics are vital for your development team to track, helping you demonstrate a project is financially viable and will deliver high returns. From the Internal Rate of Returns (IRR), cap rates, and Return on Investment (ROI), your team is likely to use key data metrics to show a project’s profitability to potential investors. Net