Abandonment – A person or entity that leaves a demised premises before the end of a lease term.
Absorption rate – The net statistical changes in occupied space over a period. Positive absorption reflects an increase in occupied space while negative absorption reflects a decrease.
Accelerator – A programming-based workplace designed to help start-up companies grow more rapidly by providing them with technical and educational assistance, mentoring, networking opportunities and workspace.
Accrued expense – Expenses incurred which are not yet payable or have not yet been paid.
Acquisition cost – The total cost to the purchaser of a property; includes soft costs and sales costs.
Adaptive Reuse – A building converted to a different use to meet current demand. Examples include a factory converted to retail use or an office building converted to a school. (Also see conversion)
Additional Rents – These are rents charged to a tenant for the maintenance, taxation, and insurance of any common areas.
After tax yield – This is the annual profit remaining after payment of income taxes, or the annual return on equity after payment of income taxes.
After tax yield rate – The annual rate of return on equity after payment of income taxes.
After Tax Equity Reversion (ATER) – the non-operating cash flow generated by property sale at end of investment horizon
Air Rights – A type of property interest referring to the “space” above land.
Amenities – These are features that make a property more attractive, useful, desirable, and/or rentable and are usually included in the sale price or rent calculations.
Amortization – The process of paying off a debt, together with interest, usually with equal payments at regular intervals over a period.
Anchor tenant – A prominent tenant occupying a large proportion of a commercial property and attracts customers and other tenants to the property.
Appraisal Estimate – This is the process that leads to an estimate of the value of a property and can also refer to the report that states the estimate and conclusion of value.
Apron – The area, within the truck court, where trucks are parked for loading and unloading. This area will be paved with more durable material than will the rest of the truck court (e.g., concrete, or other structural reinforcement vs. asphalt) to withstand the heavy loads being parked there
Arrears – Money that is due or past due but has not been paid.
Assessment – This is a levy against a property in addition to general taxes, and it is usually applied by a civic authority for improvements such as streets, sewers, etc.
Assignment – The method or manner by which a right, a specialty, or contract is transferred from one person to another.
Asking Rent – The amount asked by landlords for available space, expressed in dollars per square foot per year in most parts of the country (and per month in areas of California and other selected markets). (Synonym: face rate)
Automobile Parking Ratio – A ratio calculated by comparing the number of automobile parking spaces at a project to the gross leasable area (GLA) of a building. This ratio is usually expressed in number of spaces per 1,000 square feet of gross leasable space. It varies by property use, with labor-intensive operations needing higher parking ratios. For example, a building with a GLA of 800,000 sf would have 800 spaces expressed as 8 spaces/1,000 sf.
Available Space – The total amount of space that is currently being marketed for lease. It includes space that is vacant or also space that is currently occupied but will be vacant in the future. Available space can include both direct and sublet space. If sublet space is excluded from the calculation, the term “direct available space” is recommended.
Basic Rent – This is the rent agreed to through negotiation and does not include adjustments and additions.
BCTF (Before Tax Cash Flow) cash on cash return – subtract annual mortgage from NOI
Break-even point – This is the point where the effective gross income equals the cost of all operating expenses and debt service payments.
Basis Points (BPs) – Values equal to one-hundredth of one percentage point. For example, 100 basis points = 1 percentage point.
Bay Depth – The distance between columns. (Synonyms: clear span, column spacing)
Bay Width – The distance from one side of the bay to the other.
Big Box – A freestanding structure occupied by a dominant retailer such as Home Depot.
Biotech Space – Highly specialized laboratory or research and development space. The space is uniquely configured and is typically developed to the needs of the biotech tenant. It may require significant retrofit should the tenant vacate the space. The space is often characterized by robust mechanical, electrical, and plumbing systems, as well as by sophisticated ventilation systems to accommodate the highly specialized and complex activities that occur inside and that involve the handling of chemicals, drugs, and biological matter.
Blanket mortgage – This is a single mortgage covering more than one property, such as a mortgage covering all the lots of a builder in one subdivision.
Blend and Extend – A blend and extend lease is a type of renewal that allows tenants to blend their existing lease into a new and longer lease. If a tenant is paying rent that is above current market rents, this arrangement will lower the current rental rate. The tenant benefits by an immediate reduction in the rental rate, and the landlord benefits by securing a tenant for a longer term. Conversely, if rents are rising quickly and lease expiration is approaching a tenant may renew early and extend to lock in lower rates.
Brownfield – Abandoned, idled, or underused land or facilities where expansion or redevelopment is complicated by real or perceived environmental contamination.
Build to suit – The construction of a building or property that suits the needs of the occupant