Offering documents use standard real estate finance metrics:
- NOI (Net Operating Income): Rental income minus operating expenses (before debt service).
- LTV (Loan-to-Value): Debt as a percentage of property value—higher LTV means more leverage and sensitivity to rates.
- DSCR (Debt Service Coverage Ratio): NOI divided by required debt payments; below 1.0 signals stress.
- Yield on cost / stabilised yield: Returns based on cost basis vs market rents once leased.
Compare metrics across deals on the same basis and question aggressive assumptions.
