Can NPV be utilized when evaluating real estate leases? If so, How...?

  1. profile image47
    Richard C01posted 7 years ago

    Can NPV be utilized when evaluating real estate leases?  If so, How...?

    I evaluate leases relative to market.  If the local market has an estimated 5 yr growth of 5 percent and my discount rate for 10 years is 2 percent - can I use some form of NPV to evaluate the lease?

  2. jamesrk profile image34
    jamesrkposted 6 years ago

    I've never done it, but I suppose you can. After all, net present value is really computing the present value of future earnings in a dollar amount.

 
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