CRE Tools · Income
Net Operating Income Calculator
Turn a property's income and operating costs into the figure that drives valuation, lending, and underwriting.
Retail Blueprint · Calculator
NOI = EGI − Operating Expenses
Annual rent if every space were leased and paying.
Parking, signage, storage, and similar income.
Annual dollars lost to empty space and non-payment.
Exclude debt service, income taxes, depreciation, and capital expenditures.
Net operating income
$320,000
- Gross potential rent
- $500,000
- +Other income
- $20,000
- −Vacancy & credit loss
- $25,000
- Effective gross income
- $495,000
- −Operating expenses
- $175,000
- Net operating income
- $320,000
Typically included in operating expenses
- +Property taxes
- +Insurance
- +Property management
- +Repairs and maintenance
- +Owner-paid utilities
- +Common-area expenses
- +Recurring property operating costs
Typically not included in NOI
- ×Mortgage principal
- ×Mortgage interest / debt service
- ×Income taxes
- ×Depreciation
- ×Capital expenditures
- ×Owner-specific financing costs
Understand the metric
01
What this metric means
NOI is the income a property produces after operating expenses, before any financing. It describes the property's operating performance independent of how it is financed.
02
Why it matters
NOI is the input for value (NOI ÷ cap rate), the numerator of DSCR, and the starting point of nearly every underwriting model. Two buyers with different loans should arrive at the same NOI.
03
How it is calculated
- EGI = Gross potential rent + Other income − Vacancy & credit loss
- NOI = EGI − Operating expenses
04
Related concepts
- Cap rate and property value
- Debt service coverage ratio (DSCR)
- Expense reimbursements in NNN leases
- Cash flow before tax (NOI − debt service)
Watch & Learn · In production
NOI explained — Retail Blueprint video
An original Retail Blueprint video will appear here when published.
Retail Blueprint tools are provided for educational and informational purposes only. Results are estimates based on the information entered and simplified assumptions. They should not be considered investment, financial, lending, legal, tax, or accounting advice. Actual property performance, financing terms, expenses, returns, and valuation may differ.