Operating leverage refers to the automatic increases in net operating income (NOI) or cash flow of income-producing real estate when income and expenses increase at the same rate; this effect is further enhanced when expenses are fixed.
The projection period refers to the time duration over which future cash flows and resale proceeds from a proposed real estate investment are estimated. It plays a crucial role in evaluating the potential profitability and financial viability of real estate ventures.
A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-producing real estate.
