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CCIM 101 - Financial Analysis Q&A 2024
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CCIM 101 - Financial Analysis Q&A 2024
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CCIM 101 - Financial Analysis Q&A 2024[XXXX] is PRI minus vacancy and collection losses. - ANS-ERI (Effective Rental
Income)
[XXXX] is used to determine a property's PRI (Potential Rental Income.) - ANS-Lease
analysis
A REIT must distribute what percent of its taxable income to stockholders every year? -
ANS-90%
Cap rate + growth = [XXXX]? - ANS-Yield
For cost-recovery purposes, residential property is defined as property in which people
live for [XXXX] or more days at a time and where no substantial services (such as
healthcare, which would be commercial) are provided. - ANS-30 days
In mixed-use properties, if the Gross Rental Income (GRI) from the residential portion is
less than [XXXX]% of the total income collected, the property is treated as commercial. -
ANS-80%
Name some items which are EXCLUDED from Operating Expenses. - ANS-Interest and
principal on debt on the property
Depreciation (cost recovery)
Capital Expenditures
Income Taxes
Reserves for Replacement
Tenant Improvements
PRI equals NOI in what property/tenant scenario? - ANS-If the property has one tenant
with a long-term absolute NNN lease.
Purchase price + acquisition costs = [XXXX] basis - ANS-Original (acquisition) basis
The basis for a property that is purchased equals the purchase price plus what? - ANS-
Plus any capitalized acquisition costs (not financing costs.)
The class life (depreciation period) of NON-residential (commercial) real estate
improvements is how long? - ANS-39 years (or 2.564% p.a.)
The class life (depreciation period) of residential real estate improvements is how long?
- ANS-27.5 years (or 3.636%/p.a.)
The goal of a cost segregation study is what? - ANS-To use the engineering reports of a
property to segregate assets into personal property, land improvements, buildings and
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