BreakThru Realty

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Commercial Investment Calculator: Cap Rate, Cash-on-Cash and DSCR

Type the income, the expenses and the financing and see what a lender and a buyer would see: net operating income, the cap rate at the asking price, the cash flow after debt service, the cash-on-cash return and the debt service coverage ratio. Nothing is sent anywhere and no property is valued; it is the arithmetic, so you can test an asking price before you spend time on it.

Run the Numbers · (786) 914-1017

BreakThru Realty · Founder and Broker of Record: Tyson E. Sam, Florida License 3565210

The Four Measures

Net operating income is the income after vacancy and operating expenses and before the loan. Cap rate is NOI divided by price: what the property yields if you paid cash. Cash-on-cash is the cash flow after the loan payments divided by the cash you put in. The debt service coverage ratio is NOI divided by the annual loan payments; most commercial lenders want 1.25x or better, and a lower figure means a smaller loan or more cash down.

Where the Inputs Come From

Gross income from the rent roll and the leases, not the listing's summary; vacancy from the building's history and the market; operating expenses from the seller's statements, with property taxes and insurance replaced by what a new owner will pay, which in Florida is often far higher. The down payment, rate and amortization come from a lender; consult one before you rely on the result.

Reading the Result

If the cap rate at the asking price is below the cap rate you require, the calculator shows the price at which the verified NOI would meet it; that is your starting point for an offer. If the DSCR is under 1.25x, the loan you assumed is too large for the income, and the deal needs more equity or a lower price. A cash-on-cash return is only as good as the NOI behind it.

Run the Numbers

The calculator on this page takes: purchase price, gross income and vacancy, operating expenses, down payment, rate and amortization, your target cap rate.

Call or text (786) 914-1017 or email sales@breakthrurealty.com. A licensed BreakThru Realty agent follows up within one business day.

Frequently Asked Questions

What is a good cap rate?
It depends on the property type, the location and the tenant quality. A long-leased, creditworthy single tenant trades at a lower cap rate than a multi-tenant building with short leases, because the income is safer. The market-data and recently-sold pages show what buyers are paying for comparable property.
Why does the calculator ask for a vacancy allowance?
Because no building stays full forever, and a lender will not underwrite one that does. Five percent is a common placeholder; the building's own history and the market set the real figure.
Does this value my property?
No. It turns the figures you type into the measures a buyer uses. A broker's opinion of value starts from verified income, closed sales and the competing listings; ask for a confidential pricing review.

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