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PropertyIncomeStatement
Inthislessonweregoingtojumpintothefinancialstatementsforourofficecomplexthat
wereconstructinghere.Weregoingtolearnhowtotietogetherourconstructiontimeline
thatwecreatedinthepreviouslessonoverhere,withourestimatesfortherent,theoperating
expenses,andpropertytaxes,thevacancyrateforourcomplex.
Theissueofthehardcosts/softcosts,landacquisitioncosts,FFE,tenantimprovementsand
soon,thosearenotgoingtocomeupdirectlyonourincomestatementrighthere.Instead
thosearegoingtobeforourcashflowstatement,becausethosearereallycapital
expenditures.
Andjustaswithanormalcompanywhenyourelookingatanindividualpropertylikethis,you
dontwanttoincludeCAPEXonyourincomestatement.Remember,thatitdoesnotfigureinto
netoperatingincome.Maybe,youllincludemaintenanceCAPEX,butthatisaltogethera
separateissue,soweregoingtolookatthatlater,whenweestimatethesaleofthiscompany,
andthenetoperatingincomeaftermaintenanceCAPEX.
[1:00]
ButwhenyoureactuallylookingatNOI,youcannotincludetheconstructionofthebuilding,or
thecostsassociatedwiththat.Itisstrictlyrelatedtotherevenuesthatyoureceiveminusthe
vacancyallowance,andthensubtractingouttheoperatingexpensesandpropertytaxes,as
well.
SoitreallyissortoflikeEBITDA,exceptforanindividualproperty,ratherthanforanentire
company.Wealsohaveinterestexpense,beforewegetdowntoournetincome.Here,Ihave
setitupinaslightlycontroversialwaybyincludingonlythecashinterestexpense.
Nowtypically,fornormalcompaniesontheincomestatement,ifyouhavecapitalizedinterest
orpaid-in-kindinterestinanLBO,forexample,youwouldstillincludethatontheincome
statement.
Ivejustsetitupheresomewhatdifferentlybecauselateron,onthecashfl
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