Levered vs. Unlevered Cash Flow in Real Estate
Fundamentally, the value of a commercial real estate asset is derived from the amount of cash flow that the property produces. When evaluating potential returns for a real estate investment, investors may often have to consider levered vs. unlevered cash flows. In this article, FNRP explains the difference between levered and unlevered cash flow in […]
Understanding the Internal Rate of Return
Fundamentally, the idea of making a commercial real estate investment is a simple one. An individual contributes a certain amount of capital towards the initial cost of an investment property. In doing so, they expect that they will receive their initial investment back, plus a return over time. Prior to making an investment decision or […]
Why Part Time Commercial Real Estate Investment Can Be Bad Business
There is a misconception among individual investors that a commercial real estate (“CRE”) investment is a good way to generate “passive” cash flow. While it can definitely be a good way to generate income, it is anything but passive. Commercial properties are large, complex assets and, depending on their size and leasing activity, they can […]
