CPM flashcards
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32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Net operating income (NOI)
- NOI equals effective gross income minus operating expenses. It excludes debt service, income taxes, depreciation, and capital expenditures, and is used to measure a property's operating performance.
- Cap rate
- Capitalization rate equals net operating income divided by property value. It converts NOI into an estimate of value and reflects market risk and return expectations.
- Cash-on-cash return
- Cash-on-cash return equals before-tax cash flow divided by the equity invested. It measures the annual cash yield on an investor's actual equity contribution.
- Debt service coverage ratio
- DSCR equals net operating income divided by annual debt service. Lenders use it to gauge repayment capacity; a ratio below the loan covenant may trigger default or reserve requirements.
- Net present value
- NPV discounts all expected cash flows to present value using a required rate and subtracts the initial investment. A positive NPV means the project creates value.
- Internal rate of return
- IRR is the discount rate that makes a project's net present value equal zero. Accept projects when IRR meets or exceeds the investor's required return.
- Loan constant
- The loan constant equals annual debt service divided by the original loan amount. It lets an analyst compare debt cost across loans with different rates and amortization terms.
- Break-even occupancy
- Break-even occupancy equals operating expenses plus debt service divided by gross potential income. It shows the occupancy level at which the property covers all cash costs.
- FLSA exempt employee
- Under the Fair Labor Standards Act, exempt employees are paid a salary, meet duties tests, and are not entitled to overtime pay for hours beyond forty in a workweek.
- FMLA leave
- The Family and Medical Leave Act gives eligible employees up to twelve weeks of unpaid leave per twelve-month period for qualifying family or medical reasons, with job protection.
- Turnover rate
- Turnover rate equals the number of employee departures during a period divided by average headcount for that period. It is usually expressed as a percentage.
- SMART goals
- SMART goals are specific, measurable, achievable, relevant, and time-bound. The framework makes objectives clear enough to assign accountability and track progress.
- Situational leadership
- Situational leadership adapts a manager's style-directing, coaching, supporting, or delegating-to the competence and commitment of the individual or team for a specific task.
- Herzberg two-factor theory
- Herzberg's theory separates hygiene factors, such as pay and working conditions that prevent dissatisfaction, from motivators, such as achievement and recognition that create satisfaction and engagement.
- Triple net lease
- In a triple net lease, the tenant pays base rent plus its share of property taxes, insurance, and maintenance. The landlord receives relatively predictable net income.
- Load factor
- Load factor equals rentable area divided by usable area. It converts a tenant's usable space into rentable space so the tenant pays for a fair share of common areas.
- Percentage rent
- Percentage rent equals the tenant's gross sales above a negotiated breakpoint multiplied by the percentage rate. It is common in retail leases and supplements base rent.
- Effective rent
- Effective rent is the average net rent per period after subtracting concessions such as free rent and tenant improvement allowances. It allows comparison of competing lease proposals.
- Preventive maintenance
- Preventive maintenance is scheduled work performed before equipment fails, such as inspections, lubrication, and filter changes. It reduces emergency repairs and extends asset life.
- Mean time between failures
- MTBF equals total operating time divided by the number of failures during that period. A higher MTBF indicates more reliable equipment and supports maintenance planning.
- Life-cycle costing
- Life-cycle costing totals an asset's initial cost, operating costs, maintenance costs, and disposal costs over its useful life. It supports choosing the lowest long-term cost option.
- Trust account reconciliation
- Trust account reconciliation compares the bank balance with the book balance and individual tenant ledgers, explaining differences such as outstanding checks, deposits in transit, and bank fees.
- Management fee
- The management fee is the compensation paid to the property manager, often a percentage of collected income or effective gross income, as defined in the management agreement.
- Fiduciary duty
- A fiduciary duty requires a property manager to act in the owner's best interest, exercising loyalty, obedience, disclosure, confidentiality, and accounting for funds and property.
- AIDA model
- AIDA describes the buyer journey as attention, interest, desire, and action. Marketing messages are designed to move prospects through each stage toward a leasing decision.
- Cost per lead
- Cost per lead equals total marketing spending divided by the number of leads generated. It measures campaign efficiency and is compared with the value of a converted lease.
- Conversion rate
- Conversion rate equals the number of leases signed divided by the number of qualified leads during the same period. It shows how effectively prospects are turned into residents.
- Risk treatment options
- Risk treatment options are avoidance, reduction, transfer, and retention. Managers select the combination that best balances the cost of control against the potential severity of loss.
- Certificate of insurance
- A certificate of insurance is a document confirming that a vendor or tenant holds specified coverage, limits, and additional insured status required by the property owner.
- Business income insurance
- Business income insurance, also called business interruption coverage, replaces lost net income and continuing expenses when a covered property loss interrupts operations for a defined restoration period.
- Energy Star score
- The Energy Star score rates a building's energy performance from 1 to 100 relative to similar buildings. A score of 75 or higher may qualify for Energy Star certification.
- LEED certification levels
- LEED certification levels are Certified, Silver, Gold, and Platinum, awarded based on points earned for sustainable site, water, energy, materials, and indoor environmental quality measures.