Analytics
Intermediate
May 30, 2026
A deal can pencil at a 6% cap rate, get financed at a "7.25%" mortgage, and deliver a cash-on-cash return below zero. The mechanism is negative leverage, and it is the default condition in 2026.
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Analytics
Intermediate
May 23, 2026
Most retail pro formas obsess over rent growth and set the exit cap rate equal to the entry cap. The math runs the other way — a 50 basis point exit cap miss moves terminal value more than five years of rent growth.
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Risk Management
Intermediate
May 23, 2026
A 1.25 DSCR clears the bank. It does not clear a rate reset, a 5% vacancy spike, or an insurance jump. The number that matters is the one that holds after the shock.
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Analytics
Intermediate
May 19, 2026
Retail investors compute the entry cap rate or the stabilized cap rate. Neither tells the truth about a value-add deal. Yield on cost does.
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