CBRE - Technical Interview Questions
Cash-on-cash - answer
Return on equity - answer
debt service coverage ratio - answer-it's a metric that measures the borrower's ability to
service annual debt based on the NOI the property generates.
-calculated by dividing NOI by annual debt service
-in today's climate, lenders expect anywhere between 1.25 and 1.4 DSCR
Debt yield - answer-the higher the debt yield, the lower the risk on the lender's side
because there is lower leverage in the deal
-the lower the debt yield, the higher the risk on the lender's side because there is high
leverage in the deal.
-it's calculated by dividing NOI by the total loan amount
cap rate - answer-it's calculated by dividing the NOI by a property's value.
-lower cap rates indicate higher RE values, while higher cap rates indicate lower RE
values.
equity multiple - answer
IRR - answer
NPV - answer
levered vs unlevered - answer
explain the relationship between IRR, NPV, and the discount rate - answerwhen IRR is
equal to the discount rate, NPV is 0
talk to me about the relationship and differences of property management and asset
management - answer-property management and asset management fall under the
umbrella category of investment management.
-while property management is concerned with the day-to-day operations of a property,
i.e., maintenance, while asset management is concerned with the bigger financial
picture (i.e., maximizing the value of rental properties in a client's portfolio)
real estate cycles - answer-the shifting levels of activity in the real estate market.
Cash-on-cash - answer
Return on equity - answer
debt service coverage ratio - answer-it's a metric that measures the borrower's ability to
service annual debt based on the NOI the property generates.
-calculated by dividing NOI by annual debt service
-in today's climate, lenders expect anywhere between 1.25 and 1.4 DSCR
Debt yield - answer-the higher the debt yield, the lower the risk on the lender's side
because there is lower leverage in the deal
-the lower the debt yield, the higher the risk on the lender's side because there is high
leverage in the deal.
-it's calculated by dividing NOI by the total loan amount
cap rate - answer-it's calculated by dividing the NOI by a property's value.
-lower cap rates indicate higher RE values, while higher cap rates indicate lower RE
values.
equity multiple - answer
IRR - answer
NPV - answer
levered vs unlevered - answer
explain the relationship between IRR, NPV, and the discount rate - answerwhen IRR is
equal to the discount rate, NPV is 0
talk to me about the relationship and differences of property management and asset
management - answer-property management and asset management fall under the
umbrella category of investment management.
-while property management is concerned with the day-to-day operations of a property,
i.e., maintenance, while asset management is concerned with the bigger financial
picture (i.e., maximizing the value of rental properties in a client's portfolio)
real estate cycles - answer-the shifting levels of activity in the real estate market.
