Free Commercial NOI Calculator
Calculate net operating income for a commercial property by subtracting all operating expenses from effective gross income, following standard commercial real estate methodology.
Net Operating Income (NOI)
$160,450
Net Operating Income (NOI) vs Annual Gross Rental Income
Commercial NOI Calculation
Net Operating Income is the most important metric in commercial real estate. It measures a property's income-producing ability before debt service and capital expenditures.
Standard NOI Formula
NOI = Effective Gross Income - Operating Expenses
Where:
What NOI Excludes
Operating Expense Benchmarks
Lower expense ratios mean more income flows to NOI, which directly increases property value.
Example Calculation
$250,000 gross rental income, $15,000 other income, 7% vacancy, $28,000 taxes, $8,000 insurance, $15,000 maintenance, $18,000 management, $12,000 utilities, $5,000 other.
- 01Potential gross income: $250,000 + $15,000 = $265,000
- 02Vacancy loss: $265,000 x 7% = $18,550
- 03Effective gross income: $265,000 - $18,550 = $246,450
- 04Total expenses: $28,000 + $8,000 + $15,000 + $18,000 + $12,000 + $5,000 = $86,000
- 05NOI: $246,450 - $86,000 = $160,450
- 06Expense ratio: $86,000 / $246,450 = 34.9%