VB Porter & company real estate service

Full service real estate company

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Glossary

Absorption The amount of space that is leased and taken off the market during a given time frame.
Absorption Analysis A series of tests designed to identify (a) the likely and probably occupancy rate to be expected from a project and (b) the time required before full absorption is likely to be realized.
Active Participation A threshold definition used in tax law to define whether or not an individual is allowed to deduct losses in real estate investments; active participation requires a minimal recurring involvement in tenant selection, maintenance of properties, and decisions concerning rent levels and timing of a property purchase or sale.
Adjusted Gross Income (AGI) An individual’s gross income before deducting tax exemptions and itemized or standard deduction.
Anticipation A principle of valuation, stating that market value often is affected by expectations about future events.
Appraisal The process of estimating a property’s current value, based on comparison to similar properties and recent sales; or based on income levels for multi-unit investment properties or retail properties.
Asset Allocation The spreading of risk through an expanded form of diversification, in which investment capital is placed in several different markets (such as real estate, stocks, bonds and the money market) rather than in one market.
BANANA Acronym for Build Absolutely Nothing Anywhere, Not Anytime, describing those opposed to all types of new development; NIMBYs who want nothing to change in their neighborhoods.
Base Year The 12 month period upon which a direct expense escalation of rent is based. Typically the calendar year the lease commences.
Big Box Retail stores typically serving as anchor tenants in larger malls, so called due to their cube-shape and name recognition.
Business Plan A general description of a document intended to justify a business venture, notably for lenders; plans include narrative descriptions of a proposed course of action; revenue forecasts, cost and expense budgets and cash flow projections; and biographies of the business owners.
Business Travelers In the lodging industry, a potential guest whose primary reason for travel is business-related. This group includes the solitary business traveler, corporate small groups, and convention business.