Calculating Stabilized Net Operating Income in Real Estate


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The NOI or Net Operating Income of a property does NOT take into account:

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1. The three types of operating expenses for a commercial property to help determine its net operating income are _____.

2. James Alexander has a commercial property that he rents out to several businesses. His potential gross income from these businesses adds up to $350,000. Based on the fact that there are new office buildings being built nearby, and despite the fact that all his office space is currently rented, he is anticipating a vacancy and loss amount of $40,000. He does rent out parking spaces for $6,000 annually, and he pays $45,000 in taxes and maintenance charges and $15,000 for utilities. What is his stabilized NOI?

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About This Quiz & Worksheet

Use this interactive quiz and handy, printable worksheet to review what you know about net operating income (NOI). The quiz includes definitions and example calculation questions.

Quiz & Worksheet Goals

Check your knowledge of these topics:

  • Common operating expenses for commercial property
  • Allowances of NOI
  • Calculating stabilized NOI
  • Effective gross income calculations

Skills Practiced

You'll practice these skills:

  • Problem solving - use acquired knowledge to solve NOI and effective gross income practice calculations
  • Information recall - access the knowledge you've gained regarding operating expenses
  • Reading comprehension - ensure that you draw the most important information from the related NOI lesson

Additional Learning

Review the accompanying lesson Calculating Stabilized Net Operating Income in Real Estate to learn more. Included topics are:

  • Definition of stabilized NOI
  • Types of operating expenses
  • Calculations and examples
  • Contract rent and market rent applications
  • The difference between effective gross income and potential gross income