Glossary

National Tenant

National tenant refers to a tenant that has a national footprint with locations throughout the US. The term is most frequently used in the context of retail properties.

Read More

Net Absorption

The amount of occupied space at the end of a period less the amount of space occupied at the beginning of the same period.

Read More

Net Asset Value

Net asset value, or NAV, is defined as the total value of an entity’s assets less the total value of its liabilities. NAV is typically used to determine the share price of a pooled investment fund, based off how many shares are currently outstanding at a given time. In practice, NAV is used by funds registered with Securities and Exchange Commission, such as a mutual fund or real estate investment trust. In reality, however, any business or financial product that records its assets and liabilities can have a net asset value.

For example, say a REIT holds $15 million worth of real estate in its portfolio, and has a 10,000 shares outstanding. Given that the REIT is 50% leveraged, it would be assumed to hold $7.5 million in debt. NAV would then be calculated as so:

($15 million - $7.5 million) / 100,000 shares outstanding = $75 NAV

Read More

Net Cash Flow

Net cash flow can be determined using the formula net operating income (NOI) less debt service payments, tenant improvements,

Read More

Net Income

Net income is the total revenue minus total expenses. It represents the amount of money remaining after all operating expenses, interest, taxes and preferred stock

Read More

Net Operating Income (NOI)

Net operating income is a calculation used to analyze real estate investments that generate income. Net operating income equals all revenue generated from the property less

Read More

Net Present Value (NPV)

Net present value (NPV) represents the amount by which the expected cash flows of an investment exceeds the initial amount invested.

Read More

Net Square Footage

Net square footage is the usable or “rentable” area of a specified space (e.g. a suite, floor, or an entire building). This measurement generally excludes non-rentable areas

Read More

Net Worth

Net worth is a gauge of financial health typically defined as the difference between an individual’s or a business’s assets and liabilities. It is a measure that seeks to quantify the value of an entity’s owned assets, and the abilities of these assets to satisfy all outstanding liabilities. Ultimately, it provides insight into an entity’s financial position at a given point in time.

Read More

New Market Tax Credits

Designed to increase the flow of capital to businesses and low-income communities by providing a modest tax incentive to private investors.

Read More

Nominal GDP

Nominal GDP (gross domestic product) is a measure of economic production for a country. It includes inflation, which allows nominal GDP to use current prices or the price that products and services are sold for during that year. This is in contrast to real GDP, which does not include inflation, making nominal GDP a higher value than real GDP. Nominal GDP can be compared from quarter to quarter during a single year. To compare GDP across different years, real GDP must be used. To compare GDP across years also requires a base year.

Read More

Non Profit Organization

A nonprofit is an organization, also called an NPO, that doesn’t pay taxes on its earnings. The IRS has granted the nonprofit a tax-exempt status because it both furthers a social cause and benefits society. Some nonprofits take in donations to help further their cause. Individuals and businesses donating to a nonprofit do not have to pay taxes on those donations. Financial documents of a nonprofit must be made public so donors can see how money is being used by the organization.

The technical IRS tax code name for a nonprofit is a 501(c)(3). 501(c)(3) status must be requested for the organization to receive its tax-exemption. Additionally, the organization has to maintain compliance through its state.

Read More

Non-Accredited Investor

An investor who does not meet the special requirements for an accredited investor under the Securities & Exchange Commission’s Rule 501 of

Read More

Non-Like Kind Investment

In order to qualify as an investment in a QOZ, capital obtained by the sale of assets to provide liquidity for investment in a QOZ do not have to be like-kind assets. For example, an investor can sell stocks or precious metals and still reap the benefits of QOZ investment if he or she invests in a business or real property in a QOZ.
Read More

Non-Recourse Loan

Non-recourse loan is a loan that limits the lender’s remedies to foreclosure of the mortgage and acquisition of the collateral or property in the event of financial default

Read More

Non-traded REITs

Non-Traded REITs are a type of security that invests in real estate properties and mortgages, but is not listed on an exchange and is not publicly traded. Like any REIT, non-traded REITs distribute at least 90 percent of the company’s taxable income to shareholders in the form of dividends, however, non-traded REITs are very illiquid and usually constitute a minimum holding period per investment. Non-traded REITs are difficult to value as well, lacking an organized exchange for valuing purposes.

Read More

Nonprofit Organization

A nonprofit organization (NPO) does not pay taxes on earnings or donations used to run the business. The IRS grants NPOs a tax exemption status because they provide a social benefit. Those who make donations to an NPO, whether that be from individuals or other businesses, are able to take tax deductions on the donations. NPOs are also called 501(c)(3) organizations, after the section of the tax code that grants them tax-exempt status.

To qualify as an NPO, a business must serve the public. This can be through a service or the sale of products (or both). Financial information about the company must be made public. This allows donors to make informed decisions about whether to contribute money to the organization’s cause or not.

Read More

Nonqualified Financial Property

Nonqualified financial property’’ is defined in §1397C(e) as: debt, stock, partnership interests, options, futures contracts, forward contracts, warrants, notional principal contracts, annuities and other similar property.

Read More

Nonresident Alien

Nonresident aliens are non-citizens of the U.S. They are exempt from a Green Card. Teachers, students, foreign nationals (for tax purposes), and those seeking medical services are common nonresident aliens. Nonresident aliens pay taxes on a trade or business related to the U.S. Resident aliens (qualified persons under the substantial presence test) are those who have been in the U.S. for 31 days or resided in the U.S. for more than 183 days within a 3 year period.

Read More

Normal Good

Normal goods have a relation to a person’s income. As income increases, purchases of normal goods also increase but by a lesser amount. This is because the income elasticity of normal goods is between 0 and 1. Elasticity can be calculated by dividing the increase in demand for a good by the increase in wages. For example, a 15% increase in wages results in a 5% increase in the purchase of clothing. The income elasticity is therefore .05/.15 = 0.33.

Normal goods are different from inferior or luxury goods. Inferior goods have an income elasticity of less than 1, while luxury goods have an income elasticity that is greater than 1.

Read More

What is a 1031 Exchange?

Download the Realized Ebook - What Is A 1031 Exchange?

What is Investment Property Wealth Management?

Manage risk and help maximize opportunity

Are DST Investments Right For Me?

Are DST Investments Right For Me?