Real Estate Glossary

A reduction or decrease; usually applies to the forgiveness of rent or a decrease of assessed valuation of ad valorem taxes after the assessment and levy.

A reduction or decrease; usually applies to the forgiveness of rent or a decrease of assessed valuation of ad valorem taxes after the assessment and levy.

Net change in leased space between two dates.

The rate at which land or buildings will be sold or leased in the marketplace during a predetermined period of time, usually a month or a year. Also called "Market Absorption." The formula for calculating absorption is: Existing Inventory + New Construction - Space Removed from Market

The number of months required to convert vacant space into leased space assuming no new, delivered space. Computed by dividing the average monthly absorbed space during a recent period into the current vacant space.

(According to value) Used in reference to general property tax, which is usually based on the official valuation of property.

Considered a loss factor, the percentage of gross rentable square footage which is lost to the tenant's physical occupancy.

A type of acceleration clause where a debt becomes due in its entirety upon the transfer of ownership of a secured property. Also called "Due on Sales Clause" and "Acceleration Clause."

One of three arrangements often used for financing tenant improvements (finishing out office space to accommodate a tenant such as walls, doors, carpeting etc.) Often used in a yet-to-be built building, this arrangement caps the landlord's expenditure at a fixed dollar amount over the negotiated price of the base building shell. This arrangement is most successful when both parties agree on a detailed definition of what construction is included and at what price. Tenants may ask for a contingency in the event the actual build-out costs are less than the allowance, requiring the landlord to return the savings in the form of rent abatement or other concession.

APR reflects the cost of a loan on a yearly basis. It may be higher than the note rate because it includes interest, loan origination fees, loan discount points, and other credit costs paid to the lender.

Occurs when one party to a contract, prior to time of performance, informs the other of his or her intent not to perform. Example: The buyer informs the seller before the closing date of his or her intent not to buy.

The estimation and opinion of value place upon a piece of land based upon a factual analysis by a qualified professional; the process of estimation and the report itself.

The estimation and opinion of value place upon a piece of land based upon a factual analysis by a qualified professional; the process of estimation and the report itself.

Premises accepted by a buyer or tenant in the condition existing at the time of the sale or lease, including all physical defects.

(i) An estimate of property value for the purpose of imposing taxes. (ii) A fee imposed on property, usually to pay for public improvements such as streets and sewers.