Capitalization Rate

Definition

  • The estimated percentage rate of return that a property will produce on the owner's investment.

Synonyms
rate of return, estimated value

Related Terms and Acronyms

  • Commercial Property Definition,
    • A parcel in a district zoned for business.
  • Internal Rate of Return (IRR) Acronym, Important,
    • That rate at which the present worth of all present and future investment costs equals the present worth of all present and future investment benefits.
  • Rate Definition,
    • Percentage a borrower pays for the use of money, usually expressed as an annual percentage.
  • Rate of Return (RR, ROR) Acronym, Important,
    • The profit an investment generates, expressed as equity divided by cash flow.
  • Return on Investment (ROI) Acronym, Very Important,
    • The profit an investment generates, expressed as equity divided by cash flow.
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