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Investing in REITs: Real Estate Investment Trusts, 4th Edition by Ralph L. Block

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APPENDIX B

Case Study: FFO, AFFO, FAD, and CAD

The following example in Table B.1 is an income statement derivation of adjusted funds from operations (AFFO) and funds (or cash) available for distribution (FAD or CAD), contained in a quarterly earnings report by Post Properties, an apartment REIT. Although the calculation below was published by the REIT a number of years ago, it is nevertheless still typical of how AFFO, FAD, or CAD can be derived for most REITs.

Table B.1 Post Properties (PPS): Third Quarter, 1996

(In thousands of dollars, except for per share.)

Revenue
Rental—Owned Property $40,583
Property Management 722
Landscape Services 1,199
Interest 50
Other 1,661
Total Revenue $44,215
Property Expenses
Property Operating ...

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