*
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z
Cap Rate
The initial annual un-leveraged return on an acquisition (also known as the capitalization rate or net initial yield).
A cap rate measures the ratio between the net operating income produced by a property and its capital cost (the original price paid to buy the asset).
For example, a property's capitalization rate is ten percent if it is purchased for $10 million and produces $1 million in net operating income during one year.
Related Terms: >> Basis Points (bps), Cap Rate Qualifiers, Pricing Qualifiers
Next >> Cap Rate Qualifiers
This site and the reports herein represent the most comprehensive data set of investment activity compiled for the commercial real estate industry. While no information in this highly fragmented market is perfect or all encompassing, Real Capital Analytics (RCA) has established rigid data collection and classification methodology including sourcing requirements and procedures to ensure information is accurate and timely.
RCA has attempted to conform wherever possible to the proposed standards and definitions of the Data Consortium (sponsored by NCREIF, PREA, NAREIM) and the Appraisal Institute. Any known deviations from these standards are noted.