Commercial Real Estate Investing

BOMA: Building Owners and Managers Association in Commercial Real Estate

BOMA: Building Owners and Managers Association in Commercial Real Estate

BOMA, or the Building Owners and Managers Association, is an international trade association for commercial real estate professionals. The organization, which was founded in 1907, sets many of the standards for how commercial structures are measured. BOMA standards particularly focus on office, industrial, multifamily and retail properties

Highest and Best Use in Commercial Real Estate

Highest and Best Use in Commercial Real Estate

In commercial real estate appraisal and valuation, the highest and best use of a property is the use a property that will bring the highest value to stakeholders. When an appraiser attempts to determine the highest and best use of a property, they must not only examine its current use, but must also look into potential alternative uses. In regards to commercial real estate investing, the highest and best use typically means the use with the highest risk-adjusted returns

Full Service Lease in Commercial Real Estate

Full Service Lease in Commercial Real Estate

A full service lease is a lease in which a tenant pays only a base rate, and the landlord is responsible for paying all other expenses. Full service leases often contain an expense stop, a point above which a tenant becomes responsible for contributing to the operating expenses of the property. Common expenses can include common area maintenance (CAM) fees, utilities, property taxes, and property insurance. However, full service leases can vary widely in their exact terms, so, whether you’re a tenant or a landlord, it’s essential to understand the specific terms of the lease that you have signed.

MIRR: Modified Internal Rate of Return in Commercial Real Estate

MIRR: Modified Internal Rate of Return in Commercial Real Estate

IRR, or internal rate of return, is one of the most important financial metrics in commercial real estate investing. However, in many cases, a variation of IRR, called MIRR, or modified internal rate of return, can actually tell us more about the profitability of a commercial real estate investment, especially if we are considering that an investor may be reinvesting the cash from one CRE investment into other properties (or other types of investments).

RUBS Income in Commercial Real Estate

RUBS Income in Commercial Real Estate

In many older multifamily properties, units are not individually metered for utilities, so owners/landlords use RUBS (Ratio Utility Billing System), a method of determining a resident's utility bill based on factors like unit square footage, the number of people living in a unit, or some combination thereof. RUBS can be an excellent way for landlords to reduce costs without directly increasing rent prices.

Commercial MLS in Commercial Real Estate

Commercial MLS in Commercial Real Estate

A multiple listing service, or MLS, is a software system used by real estate brokers in order to represent the sellers of properties, search for properties for buyers, and to establish commission rates for other brokers who may help a broker sell a property. There are approximately 900 MLS services in the United States, most of which are intended for residential property brokers in specific local areas. However, there are only a few commercial MLS providers that stand out, including LoopNet, CoStar, CREXi, Brevitas, and ApartmentBuildings.com.