Net Operating Income (NOI)
NOI is income remaining from income-generating properties after deducting necessary operating expenses from a property's total revenue. It is an operating metric, typically considered before financing costs.
- Where it applies
- Generally, not specific to New York
- When it comes up
- Valuation; underwriting; asset management; reporting
- Property types
- All income-producing real estate
In practice
The NOI definition used for underwriting often differs from GAAP operating income and from "property-level" management reporting; reconciliation logic is a common diligence item.
Read more in the Knowledge Base
- Rent-vs-Occupancy Optimization - When Maximum Rent Destroys Portfolio NOILandlords
- Investor Buyer StrategySellers
- Rent vs. Sell Decision Framework for New York Property OwnersLandlords
- Selling Rent-Stabilized BuildingsSellers
- Selling Small Multifamily (2-4 Units) in New York - Tenant Issues and Hybrid PricingSellers
Related terms
Commercial Lending
- Acceleration Clause
- Bridge Loan
- Credit Facility
- Debt Service Coverage Ratio (DSCR)
- Pari Passu Loan
- SBA 504 Loan Program
General information, not legal, tax or financial advice.