Glossary
Acquisition, development, or construction arrangements (ADC arrangements).
Lending arrangements in which a lender, usually a financial institution, participates in the expected residual profit from the sale or refinancing of property.1 Expected residual profit is the amount of profit (often called equity kicker), above a reasonable amount of interest and fees.
ADC arrangements.
See acquisition, development, or construction arrangements.
Adjusted funds from operations (AFFO).2
A measure of a real estate company's cash flows generated by operations. AFFO is calculated by adjusting funds from operations (FFO) by (1) normalized recurring property expenditures that are capitalized by the real estate company and then amortized, such as new carpeting and tenant improvement allowances, and by (2) the impact of straight-lining of rents.
Air rights.
The right to air space above real property. Air rights are rights that can be sold or leased.
Amenities.
Features that enhance the attractiveness or value of a real estate property. Examples of amenities include golf courses, clubhouses, swimming pools, tennis courts, indoor recreational facilities, and parking facilities.3
Antispeculation clause.
A clause included in a land sale agreement that requires the buyer to develop the land in a specific manner or within a stated period of time. If the buyer fails to comply with the provisions of the sales contract, the seller has the right to reacquire the property.4
Asset retirement.
The ...
