From the roll to NOI
Rent roll analysis
A rent roll is the income, unit by unit or tenant by tenant. The illustrative case states it in aggregate: one average apartment rent, and one retail rent per square foot. That is enough for a first pass. A named tenant roll belongs on your own deal.
The illustrative roll
Cayuga Commons (Illustrative Case) has 24 apartments at $2,400.00 a month and 4,200 square feet of retail at $38.00 per square foot per year. Residential vacancy is 6.00%. Retail vacancy is 8.00%. Other income is $45,000.00 a year at the start.
There are no tenant names on this case. The page stays with that aggregate roll, the figures the engine runs for the free deal.
From the roll to year 1 NOI
Gross potential rent is the roll before vacancy. Vacancy comes off each line. Other income is added. Operating expenses come off. What remains is NOI. Debt service stays out of that subtraction. A reduction prints in parentheses.
- Residential gross potential rent
- $691,200.00
- Residential vacancy
- ($41,472.00)
- Retail gross potential rent
- $159,600.00
- Retail vacancy
- ($12,768.00)
- Other income
- $45,000.00
- Effective gross income
- $841,560.00
- Operating expenses
- ($247,493.60)
- Year 1 NOI
- $594,066.40
Named tenants
On your own deal a commercial rent roll can name tenants, area, base rent, and a lease term in whole years. Free rent and leasing costs, when you enter them, hit the years the engine assigns. A term the model cannot represent, such as a part of a year, holds the deal rather than being rounded.
That behavior is described on the model boundaries page. Reading a rent roll out of an offering memorandum is part of Underwrite Core. The aggregate case on this page is free to open.
Frequently asked questions
Does the illustrative case have named tenants?
No. It states 24 apartments at $2,400.00 a month and 4,200 square feet of retail at $38.00 per square foot a year. Named tenants are an input on your own deal.
How does the roll become NOI?
The engine takes gross potential rent, subtracts vacancy, adds other income, and subtracts operating expenses. Year 1 NOI on this case is $594,066.40.
What if a lease term is not a whole number of years?
The model does not round a term it cannot represent. That limit is on the model boundaries page.
Can I check a rent roll from an offering?
Yes, with Underwrite Core. Cayuga Commons (Illustrative Case) is free and uses the aggregate roll above.