Cap rates are a measure of a property’s investment potential, independent of the specific buyer.
Investors, lenders, and appraisers use Reis to estimate the appropriate purchase price for different types of income producing properties.
To give our clients a complete picture of the income value of a specific property Reis evaluates three cap rates in our proformas, which are included in our sales comps, and can be seen in the example above.
By providing transparency in our calculations we enable clients to accurately quantify cash flows and estimate the potential return on investment (ROI).
Reis provides an analysis which projects income and expenses one year forward from the point of sale. Clients can customize the Microsoft Excel version of the proforma calculation.
Reis’s historical database provides a complete view of metro cap rate trends, providing a clear top down understanding of the investment potential of your property. Understanding the historical performance of the metro is critical to assessing the potential ROI.
I use Reis daily for my essential job functions. Whether it be a new deal, annual review, or potential markets to move into/stay out of, Reis provides the data we need to feel we understand the market. Great data, easy to use, great support.
- Rich Shulmistra, VP, Portfolio Manager at First Citizens Bank
I believe is REIS is a valuable tool and I place a great reliance on the data that's reported. REIS provides information necessary to formulate an opinion about the strength or weakness of any particular asset type or market we are considering. I also rely on REIS for comparable and historical sales to justify purchase price of the projects we are considering financing.
- Sylvia Szawrycka, Senior Real Estate Officer at Union Bank