How this calculator works
Convert the rentable floor area into the unit used for the annual rent quotation. Apply occupancy to potential rent only, since other income is entered as an already-collected amount. Subtract the itemized annual operating expenses. Do not enter loan payments, depreciation, capital improvements or personal income tax as operating expenses.
Formula
Potential rent = area × annual rent per area. Vacancy loss = potential rent × (1 - occupancy). Effective gross income = potential rent - vacancy loss + other collected income. NOI = effective gross income - operating expenses.
Worked example
For 1,000 square metres at $30 per square metre annually and 90% occupancy, rent collected is $27,000. Adding $2,000 other income and subtracting $12,000 expenses gives $17,000 NOI.
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Frequently asked questions
Where do mortgage payments go?
They are deducted after NOI when calculating cash flow after debt service.
Are vacant rooms included in rentable area?
Yes. Enter potential rentable capacity, then use occupancy to allow for vacant space.
Can I quote rent per square foot?
Yes. Select the rent quotation unit independently of the floor-area input unit. The calculation converts area before multiplying.