How Underwrite handles Retail.
Retail income is based on rentable area and annual rent per square foot. Review tenant concentration and expense recoveries. The anchor-loss stress scenario tests lower income if a major tenant leaves.
The Retail 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 Retail deal:
- Rentable SF. Total leasable retail square footage.
- Rent / SF / Yr. Annual rent per SF. Grocery-anchored centers typically $15-30/SF base; high-street retail $50-300/SF.
- Vacancy. Stabilized vacancy. Stabilized retail rarely exceeds 25%; value-add can hit 50% but anything above that is essentially a vacant box.
- Cost / SF. Purchase price divided by SF. Wide range: $150-300/SF for grocery-anchored; $500-1,500/SF for high-street.
- Y1 NOI / SF. NOI per SF; the primary cap-rate-adjacent metric.
Checks for this property type
The validation guards use these tighter bands for Retail instead of the generic defaults:
- Property management % of EGI: 2-6%. Standard institutional band. NNN retail can run thinner; mom-and-pop centers run higher.
Stress scenarios
The desk offers these stress scenarios when Retail is the property type:
- Anchor Tenant Loss. Vacancy +20pp, rent growth to 0, exit cap +100bps. Models the cascade from losing an anchor: cotenancy clauses, percentage-rent resets, slower re-lease.
- All four generic stress scenarios (Base, Recession, Rate Spike, Aggressive) are also available on Retail deals.
Example deal: Riverbend Grocery Center
The Retail 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 Retail 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, CAM, property tax and insurance reimbursements in net retail leases are not credited to income. Included, they are modeled without gross-up or reconciliation.
- Percentage rent (overage rent tied to tenant sales above a breakpoint) is not modeled.
- Co-tenancy is not read from leases. Until you include it, it is not modeled. Included, one stated anchor-loss case cuts inline rent by a stated percent or ends a stated share after a cure period.
- Tenant credit / sales productivity data is not surfaced.