CRE Financial Metrics & Calculations

Every CRE financial metric — from NOI and cap rate to DSCR and IRR — is only as accurate as the underlying lease and financial data. These guides explain each metric and show why precise lease abstraction and financial spreading matter for accurate analysis.

Last updated March 202610 financial metrics

Financial Metrics

Formula: NOI ÷ Property Value

Capitalization Rate (Cap Rate) in Commercial Real Estate

Capitalization Rate (Cap Rate) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves cap rate analysis.

Formula: Annual Pre-Tax Cash Flow ÷ Total Cash Invested

Cash-on-Cash Return in Commercial Real Estate

Cash-on-Cash Return in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves cash on cash return analysis.

Formula: NOI ÷ Annual Debt Service

Debt Service Coverage Ratio (DSCR) in Commercial Real Estate

Debt Service Coverage Ratio (DSCR) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves dscr commercial real estate analysis.

Formula: GPR + Other Income − Vacancy Loss

Effective Gross Income (EGI) in Commercial Real Estate

Effective Gross Income (EGI) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves effective gross income analysis.

Formula: Property Price ÷ Gross Annual Rent

Gross Rent Multiplier (GRM) in Commercial Real Estate

Gross Rent Multiplier (GRM) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves gross rent multiplier analysis.

Formula: NPV = 0 (solve for r)

Internal Rate of Return (IRR) in Commercial Real Estate

Internal Rate of Return (IRR) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves internal rate of return analysis.

Formula: Loan Amount ÷ Property Value

Loan-to-Value Ratio (LTV) in Commercial Real Estate

Loan-to-Value Ratio (LTV) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves loan to value ratio analysis.

Formula: EGI − Operating Expenses

Net Operating Income (NOI) in Commercial Real Estate

Net Operating Income (NOI) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves net operating income analysis.

Formula: Total Occupancy Cost ÷ Tenant Gross Sales

Occupancy Cost Ratio in Commercial Real Estate

Occupancy Cost Ratio in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves occupancy cost ratio analysis.

Formula: Σ (Remaining Term × Lease Value) ÷ Total Portfolio Value

Weighted Average Lease Term (WALT) in Commercial Real Estate

Weighted Average Lease Term (WALT) in Commercial Real Estate — learn the formula, calculation method, common mistakes, and how accurate lease data improves weighted average lease term analysis.

Accurate Data, Better Calculations

Ensure accurate calculations with precise lease and financial data

Crevanta extracts the underlying lease and financial data that feeds into CRE metrics — ensuring accuracy and consistency across your portfolio.