In CRE, an asset is any property or investment that holds economic value and is expected to generate future income, classified by risk profile.

Market value is the price a property would bring in an open, competitive market between a willing buyer and seller, neither acting under duress.

Valuation is the process of determining a commercial property’s current market worth, using methods such as the income, sales comparison, and cost approaches.

An annuity is a series of equal payments made at regular intervals, a concept underlying CRE calculations such as mortgage payments, lease streams, and discounted cash flow.

Amortization is the gradual repayment of a loan through scheduled payments covering both principal and interest, affecting a property’s cash flow over the loan term.

Inflation is the general rise in prices over time, which erodes purchasing power and pushes property values, rents, and construction costs higher in commercial real estate.

Acquisition is the process of purchasing or gaining control of a property or portfolio, from sourcing and due diligence to financing and closing.

The capitalization rate (cap rate) estimates a property’s return by dividing net operating income by its market value or price.

A deficit occurs when a property’s expenses and debt service exceed its income, producing negative cash flow the owner must cover.

Liability is the legal and financial obligation a party may be responsible for, including debts, damages, or harm from property ownership.