Funds from Operations
Definition
What is Funds from Operations?
A REIT performance measure that adjusts net incomeProfit remaining after operating costs, financing costs, taxes, and other recognised items. for real-estate depreciationThe systematic allocation of a tangible asset's cost over its useful life. and certain property-sale gains.
Example in practice
How This Looks in Practice
Analysts use FFO to assess recurring propertyLand and buildings held for use, rent, development, or capital appreciation. operations.
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Related Terms
Adjusted Funds from Operations
A refined REIT cash-flow measure that adjusts FFO for recurring capital expenditure and other items.
REIT MetricsREIT Dividend Yield
Annual REIT distributions divided by the market price.
REIT MetricsNet Asset Value of a REIT
Estimated property value minus liabilities, usually expressed in total and per share or unit.
Private MarketsPrivate Equity
Investment in privately held companies, often with active ownership and a multi-year exit plan.