Banks continue to deal with commercial real estate (CRE) loans as a major portion of their loan portfolios. Also, many borrowers still have large holdings of income-producing or rental real estate. Whether directly financing these assets or including the income stream(s) in your overall credit analysis, it is important to understand key analytical concepts utilized in evaluating CRE cash flow.What You'll Learn:

• Cash flow or net operating income (NOI) concepts
  
• Understanding key variables: vacancy, management fees, and replacement reserves
  
• Using NOI along with a cap rate to estimate current property value
  
• Moving from NOI to cash flow available for debt service (CFADS) and DSC
  
• Stress-testing of debt service coverage (DSC) and loan-to-value (LTV) at transaction level
  
• How to use a sample worksheet to explore the major issues, including stress-testing, demonstrated with a case example