net operating income

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Related to net operating income: Cap rate

Earnings Before Interest and Tax

A measure of a company's ability to produce income on its operations in a given year. It is calculated as the company's revenue less its expenses (such as overhead) but not subtracting its tax liability or interest paid on debt. It is important to note that EBIT does not account for one-off or otherwise unusual revenues and expenses, only recurring ones. EBIT represents cash available to pay off creditors in the event of liquidation and, as such, it is closely watched, especially when the company incurs little depreciation or amortization. It is also called operating profit.
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net operating income (NOI)

The foundation of almost all analyses of income-producing property such as apartments,office buildings,and retail space.The number is the result of taking all rental and other revenues from the property and then subtracting all reasonably necessary operating expenses.Loan payments do not count as expenses for purposes of the NOI.If you,as the owner,pay yourself a salary of $100,000 a year but your job could be filled by someone at $35,000 a year, it is legitimate to make that downward adjustment in the expenses when presenting figures to a potential purchaser or lender. On the other hand, if you take no salary, do all the office work, make all repairs, and mow the lawn, then you will have to estimate what those expenses would be if a third party owned the project and enter that number as an imputed expense.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
The Company realised net operating income of RMB177.386 billion, representing a year-on-year increase of 13.54%.
Sirius will continue to receive the net operating income of the site for the term of the lease which is currently at around EUR 5.3m.
Net operating income refers to earnings after operating and maintenance costs are paid but before income taxes and debt payments.
Riverview Storage is a 12,685 SF self storage facility which is 62% leased to a mix of household and commercial storage tenants with a history of generating approximately $26,163 in net operating income annually.
Simon estimated that the spin-off's portfolio would generate net operating income its first year of $400 million, and $2 billion in debt.
That compares with $5.8 million in net operating income on $438 million in net earned premiums, fees and other income in the third quarter of 2011.
PGA National's net operating income for 2010 was more than four times the amount required to cover its mortgage debt, according to special servicer notes.
Eastern Virginia Bankshares (NASDAQ: EVBS) has reported that its net operating income for the three months ended March 31, 2011 was USD474,000, a decrease of USD860,000 over the net operating income of USD1.3m reported for the same period of 2010.
Taipei, April 14, 2010 (CENS) -- Lite-On Technology Corp.'s after-tax net income and net operating income rate for the first quarter both hit a two-year high, with the income posting at US$79 million and the rate standing at 7.3%.
Net Operating Income. Subsidized properties reported in the survey had lower levels of NOI than the market rent properties in all three measures.
Note: The type of income or cash flow used in investment real estate is net operating income (NOI).