Commercial Real Estate Debt Yield Calculator
Calculate actual Debt Yield and model maximum commercial loan sizing for multifamily, industrial, retail, and office properties.
Commercial Real Estate Debt Yield & Loan Sizing Calculator
Calculate actual Debt Yield (NOI / Loan Amount) and model maximum loan sizing under institutional lender underwriting hurdles.
Lender minimum target: 10.0%. Current LTV: 66.7%.
How Lenders Use Debt Yield in Commercial Underwriting
In commercial mortgage underwriting (particularly CMBS and life insurance loans), Debt Yield is considered the ultimate risk benchmark. Institutional lenders typically require a minimum debt yield between 9.0% and 11.5% to ensure the property generates enough operating cash flow to cover the loan regardless of market cap rate movements.
Key Features
Direct Debt Yield Formula
Instantly computes Debt Yield = (Net Operating Income / Loan Amount) × 100 without interest rate bias.
Maximum Sized Loan Calculator
Determines the exact ceiling on mortgage debt a property can support at your lender's required hurdle rate.
LTV & Sizing Integration
Models loan-to-value alongside debt yield to isolate the binding underwriting constraint.
Common Use Cases
- ✓CRE Mortgage Brokers & Originators
Size debt packages accurately across CMBS, life company, and commercial bank balance sheet lenders.
- ✓Real Estate Developers & Sponsors
Stress-test refinance loan proceeds and identify equity gaps before approaching capital markets.
Frequently Asked Questions
What is Debt Yield in commercial real estate?
Debt Yield is the ratio of a property's Net Operating Income (NOI) to the total mortgage loan amount, expressed as a percentage: Debt Yield = (NOI / Loan Amount) × 100. It measures a lender's unleveraged cash-on-cash return if they were to foreclose on the property.
Why do lenders prefer Debt Yield over DSCR?
Unlike the Debt Service Coverage Ratio (DSCR), Debt Yield is completely independent of the loan's interest rate, amortization schedule, or cap rate, providing a pure measure of loan risk.
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