How Underwrite handles Industrial.
Industrial income is based on rentable area and annual rent per square foot. Tenant-paid expenses are credited only when you include expense recoveries. Review vacancy, cost per square foot and first-year NOI.
The Industrial example opens with Underwrite Core. The worked example, Cayuga Commons, is free with no sign-in.
What the model covers
The operating summary shows these measures for a Industrial deal:
- Rentable SF. Total leasable industrial square footage.
- Rent / SF / Yr. Base rent in dollars per SF per year, NNN basis (tenant pays expense recoveries separately).
- Vacancy. Stabilized vacancy. Long-WALT NNN industrial typically runs 3-5%.
- Cost / SF. Purchase price divided by SF. Industrial averages $70-200/SF nationally; coastal logistics $200-400/SF.
- Y1 NOI / SF. NOI per SF, useful for comparing across deals at different scales.
Checks for this property type
The validation guards use these tighter bands for Industrial instead of the generic defaults:
- Property management % of EGI: 0.5-4%. Triple-net leases shift expense responsibility to the tenant; landlord operations are minimal. 2% is typical.
Stress scenarios
The desk offers these stress scenarios when Industrial is the property type:
- Industrial Cap Expansion. Exit cap +150bps, rent growth -100bps. Industrial saw historic cap compression in 2020-2022; mean-reversion is a real risk if rates stay elevated or supply unwinds.
- All four generic stress scenarios (Base, Recession, Rate Spike, Aggressive) are also available on Industrial deals.
Example deal: Cedar Logistics Center
The Industrial pre-built example computes to the headline values below. With Underwrite Core, open it in the tool to edit any input and watch the model update, or open its investment committee memo.
Current model boundaries for this asset class
These Industrial features are simplified or left out of the model, and stay with the analyst. The full list across all asset classes is at /methodology/beyond-phase-1.
- Until you include them, industrial rent is base rent only, and net-lease reimbursements (CAM, taxes, insurance) are not credited to income. Included, they are modeled without gross-up or reconciliation.
- Without a tenant rent roll, lease escalations are aggregated into the single rent-growth input; with one, each tenant carries its own escalator.
- Expansion options are modeled per tenant when entered, as exercised: extra SF from a stated year, co-terminous with the lease in force. Sale-leaseback structures are not modeled.
- Cold storage / specialty industrial uses the generic preset; real underwriting differentiates by clear height, dock-door count, and refrigeration load.