How I actually read a deal

Most people shop net lease and retail by cap rate. Higher cap, better deal, right? Nope, that's backwards.

A cap rate is just this year's income divided by the price. It says nothing about whether that income shows up next year, or in year ten. Two buildings can trade at the same 6.5 percent and be worth very different numbers, because the risk behind the rent is different.

Start at the market

Every asset type has a benchmark cap for a clean, long, well-tenanted deal. That's the floor, not the answer. Then I adjust up or down for the things that actually move value:

What actually moves the number

• Remaining term. Fifteen years of contractual income is worth far more than four. Short term isn't a discount, it's a different asset, closer to the value of the empty building.
• Escalations. Flat rent quietly loses to inflation. Regular bumps protect your yield and your resale.
• Tenant credit. A corporate guarantee is not the same promise as a single franchisee LLC. Price the guarantee, not the logo.
• Lease structure. True triple net, where the tenant pays taxes, insurance, and repairs, beats a lease where those costs quietly land back on you.
• Capex. Who owns the roof and the parking lot matters. An old roof on your side of the lease is a real number.

I start at the benchmark and add or subtract for each of these until the price matches the risk. That's the number. The analyzer runs this exact logic in about a minute, free. Run your deal, and when you want the real number with live comps and a buyer's eye, my team will build you a Broker Opinion of Value at no cost.