Net operating income is a property’s income after operating expenses but before debt service and capital items. It equals effective gross income minus operating expenses (taxes, insurance, payroll, repairs, management) — the core measure of how much a property earns from operations.
NOI drives value: most multifamily is valued by dividing NOI by a market cap rate. It excludes mortgage payments, capital expenditures, depreciation, and income taxes, so two investors can compare the same building regardless of their financing or tax situation.
See how EagleCap structures multifamily investments for passive investors.
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