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Real Estate Financial Modeling Accelerator (Updated October 2024)

Prior to launching the Accelerator program, Michael and I fielded email after email requesting a more structured real estate financial modeling training program on the site. Over the years, we've covered hundreds of real estate modeling…

Floor to Ceiling Height

The height between each floor plate in a building measured from the top of a floor to the surface of the ceiling. Putting "Floor to Ceiling Height" in Context Redfield Capital, a real estate investment firm specializing in core-plus acquisitions,…

Floor to Floor Height

The height between each floor plate in a building measured from the top of a floor to the top of the floor above. Putting "Floor to Floor Height" in Context Redfield Capital, a real estate investment firm specializing in core-plus acquisitions,…

Forward Sale

A binding contract between two parties to enter into a purchase and sale agreement at a fixed future date, the terms and conditions of which are agreed upon today. Putting 'Forward Sale' in Context AnchorPoint Net Lease REIT has entered…

Free and Clear Return

The total unlevered (before debt) pre-tax operating cash flow (i.e. Cash Flow from Operations) of a real estate project divided by the total capital invested, generally expressed as a percentage on an annual basis. To clarify, the numerator…

Floor Plan

An architectural drawing that depicts a floor layout of a specific floor or room of a building in two dimensions and from a top looking down vantage point. Putting 'Floor Plan' in Context Isthmus Developers, a leading real estate development…

Floor Plate

A term commonly used in commercial real estate to refer to an entire floor of a building. The term is commonly used when discussing square footage and/or variations in size and shape of floors within a building. Example of how it can be used: There…

European-Style Waterfall

A common method for distributing investment cash flow between two or more partners. A European-Style waterfall refers to a form of equity waterfall where no promote (i.e. carried interest) is paid to the sponsor (i.e. general partner) until…

Fee Simple

Fee simple is a form of ownership in real property. Specifically, it refers to an owner having full and irrevocable ownership of the land and any buildings on that land. Fee simple is the highest form of property ownership, and most real estate…

FF&E

Furniture, Fixtures, and Equipment (FF&E). In real estate financial analysis, FF&E is most often found as a line item in development budgets and operating statements. It can generally be defined as any easily moveable object not permanently…

Floor Area Ratio

A ratio expressing the relationship between the buildable area (currently built or permitted) and the land on which the property is located. A higher FAR ratio indicates a higher density (i.e. the more area legally permissible to be built on…

Fixed Price Contract

As it relates to commercial real estate, a fixed price contract is an agreement where a contractor presents a quote to the property owner or general contractor, with a predetermined value that does not change to perform the work of a contract.…

Fixed Rate Debt

Fixed Rate debt refers to a form of financing where the interest rate used to calculate the interest due in each period is constant (i.e. does not change). This is in contrast to Floating Rate debt, where the interest rate does change periodically. The…

Entitlement Process

The process through which a real estate developer or landowner seeks the right to develop (or redevelop) property with government approvals for zoning, density, design, use, and occupancy permits. Upon securing all necessary entitlements from…

Floating Rate Debt

Floating Rate or Variable Rate debt, refers to a form of financing where the interest rate used to calculate the interest due in each period changes (i.e. varies or floats) periodically. The interest rate for a floating rate loan is generally…

Financing Memorandum

A request for mortgage financing given to lenders by commercial real estate borrowers (or their representatives) for the lenders' investment consideration. The memorandum will typically highlight various terms and property specifics such as…