commercial-real-estate calculator
A professional-grade tool for investors, brokers, and lenders to evaluate income-producing property. Instantly compute NOI, DSCR, cap rate, loan amount, monthly debt service, balloon balance, and cash-on-cash return—optimized for quick “go / no-go” underwriting and side-by-side comparisons.
Deal Inputs
Contract price or market value of the property, excluding closing costs.
Total rent at 100% occupancy before vacancy and credit loss.
Market vacancy and collection loss as a percent of gross income.
Operating Expenses (annual)
Non-operating reserve for future replacements (roof, HVAC). Not part of NOI under standard underwriting.
Loan Parameters
Balloon date if shorter than amortization (typical CRE). Remaining balance due at term.
Key Metrics
Net Operating Income (NOI)
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Cap Rate
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Loan Amount
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Monthly Debt Service
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DSCR
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Balloon Balance (at term)
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Total Cash Invested
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Cash-on-Cash Return
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Operating Expense Ratio
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Income & Expense Table
| Line | Annual | Monthly |
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Data Source & Methodology
AuthoritativeDataSource: Office of the Comptroller of the Currency (OCC), Comptroller’s Handbook: Commercial Real Estate Lending, July 2013 (updated). Official OCC resource. Definitions for NOI and DSCR follow industry practice as summarized by the OCC and the Appraisal Institute (The Appraisal of Real Estate, 15th ed.).
Tutti i calcoli si basano rigorosamente sulle formule e sui dati forniti da questa fonte.
The Formula Explained
Glossary of Variables
- EGI – Effective Gross Income after vacancy and credit loss.
- OPEX – Operating expenses used to derive NOI (excludes capital reserves and debt service).
- NOI – Net Operating Income before debt service and capital items.
- Cap Rate – NOI divided by purchase price.
- DSCR – Debt Service Coverage Ratio = NOI / annual debt service.
- L – Loan principal; i – periodic interest rate; n – number of monthly payments.
- Balloon – Remaining principal due at loan term if amortization is longer than term.
- Cash Invested – Down payment + closing costs.
- Cash-on-Cash – Annual pre-tax cash flow / cash invested.
How It Works: A Step-by-Step Example
Suppose a $1,200,000 purchase with $180,000 gross income, 6% vacancy, $6,000 other income, and expenses as entered above. With a 70% LTV at 7.25% APR, 25-year amortization and 10-year term:
- EGI = 180,000 × (1 − 0.06) = 169,200.
- Management = 5% × 169,200 = 8,460. Add other OPEX to get total OPEX.
- NOI = EGI + Other income − OPEX.
- Loan amount = 70% × 1,200,000 = 840,000 (unless overridden).
- Monthly payment via amortization formula; annual debt service = PMT × 12.
- DSCR = NOI ÷ annual debt service. Cap rate = NOI ÷ price.
- Balloon balance computed at year 10 based on remaining amortization.
- Cash needed = 30% down + closing costs; Cash-on-cash = (NOI − ADS) ÷ cash needed.
FAQ
What DSCR do lenders typically require?
Common CRE underwriting targets range from 1.20× to 1.40× depending on asset type, leverage, and market conditions. This tool highlights DSCR dynamically so you can size the loan or adjust terms.
Is CapEx part of NOI?
No. Capital reserves and replacements are not included in NOI under standard practice; they impact cash flow and cash-on-cash but not NOI.
Can I override LTV and set a fixed loan amount?
Yes. Enter a loan amount to override the LTV-based calculation. Clear the field to return to LTV mode.
What does the balloon balance mean?
If the loan term is shorter than the amortization, a remaining principal (balloon) is due at the end of term. The calculator shows that projected payoff amount.
Does this calculator include taxes or depreciation for after-tax returns?
No. It focuses on pre-tax operating and financing metrics (NOI, DSCR, cap rate, cash-on-cash). Export data and add your tax assumptions if needed.
How should I handle variable-rate or IO periods?
For quick sizing, approximate with the expected stabilized rate and use interest-only by setting a very large amortization and reading the PMT. A dedicated IO toggle is planned for a future release.
Tool developed by Ugo Candido. Content reviewed by CalcDomain Editorial Board.
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