Contracts, regulations, compliance, entity structures, zoning, permits, and landlord-tenant law.
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Foundation terms you need to know first (89 terms)
Development costs are all the expenses incurred during the process of acquiring land, designing, constructing, and preparing a real estate project for use or sale, from start to finish.
Base rent is the fixed, minimum rent amount paid by a tenant to a landlord for the use of a property, excluding additional charges like operating expenses, taxes, or utilities.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
The Lease Commencement Date is the official date specified in a lease agreement when the tenant's rights and obligations, including rent payments and property responsibilities, legally begin.
An application fee is a non-refundable charge paid by a prospective tenant to a landlord or property manager to cover the costs associated with processing a rental application, including background and credit checks.
Complex strategies and professional concepts (117 terms)
An Equity-for-Property Swap is an advanced real estate investment strategy where an investor exchanges equity in one or more properties or entities for direct ownership of another property, often to achieve tax deferral, portfolio restructuring, or strategic asset acquisition.
The accounting process of recognizing the estimated cost of an Asset Retirement Obligation (ARO) as a liability and capitalizing a corresponding asset, which is then depreciated over its useful life, reflecting the future costs associated with retiring a long-lived asset.
A legally binding contract that alters the priority of liens on a property, allowing a senior lienholder to voluntarily place their claim in a junior position to another, typically to facilitate new financing or complex transactions.
Unrelated Business Income Tax (UBIT) is a tax levied on the net income of a tax-exempt organization, including certain real estate investment vehicles, derived from a trade or business regularly carried on and not substantially related to its exempt purpose.
Inverse condemnation is a legal action initiated by a private property owner against a government entity to recover "just compensation" for a taking of their property, where the government has not formally exercised its power of eminent domain but has effectively deprived the owner of beneficial use or value.
Misrepresentation in real estate refers to a false statement of a material fact made by one party that induces another party to enter into a contract, often leading to legal consequences.
Mixed-use development integrates multiple property types, such as residential, commercial, and retail, into a single project or compact area to create vibrant, walkable communities.
Mold remediation is the specialized process of safely identifying, containing, and removing mold growth from a property, followed by cleaning and disinfection to prevent its return and protect property value and occupant health.
A mortgage note is a legally binding document signed by a borrower, promising to repay a loan used to purchase real estate, outlining the specific terms of repayment.
Multifamily construction involves the development and building of residential properties designed to house multiple families or tenants, such as apartment complexes, condominiums, or townhouses, often for investment purposes.
Multiple offers describe a real estate scenario where a property receives purchase proposals from more than one prospective buyer, often simultaneously, indicating high demand and competition.
Natural disaster risk assessment is the process of identifying, evaluating, and quantifying potential financial and physical impacts of natural hazards on real estate investments, crucial for informed decision-making and risk mitigation.
Negligence in real estate refers to a failure to exercise the reasonable care that a prudent person would have exercised in a similar situation, leading to harm or damage to another party. It is a critical concept in liability and risk management for real estate professionals and investors.
Negotiation in real estate is the strategic process of discussing and agreeing upon the terms and conditions of a property transaction, aiming to achieve mutually beneficial outcomes for all parties involved.
Net Income from Discontinued Operations represents the profit or loss from a segment of a business that has been disposed of or is classified as held for sale, reported separately on the income statement after tax.
A net lease is a commercial real estate lease structure where the tenant is responsible for paying a portion or all of the property's operating expenses in addition to base rent.
New construction refers to the process of building a property from the ground up, rather than acquiring an existing structure. For investors, it involves developing or purchasing a newly built residential or commercial property, offering distinct advantages and challenges compared to existing real estate.
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