Unit 24
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Frontage
The linear measurement of a property's boundary that fronts a street, road, or water body. Often affects value and development potential.
A commercial lot with 150 feet of frontage on Main Street is more valuable for retail development than a similar lot with only 50 feet of frontage.
Interest
The cost of borrowing money, expressed as a percentage of the loan amount. Calculated as Principal × Rate × Time.
On a $200,000 loan at 6% annual interest, the borrower pays $12,000 per year in interest ($200,000 × 0.06).
Net Operating Income (NOI)
The income generated by a property after operating expenses but before debt service and income taxes. Key metric for investment analysis.
A rental property generates $60,000 in gross rent minus $22,000 in operating expenses, resulting in $38,000 NOI.
Perimeter
The total distance around the outside of a property or building. Calculated by adding the lengths of all sides.
A rectangular lot measuring 100 ft by 150 ft has a perimeter of 500 feet (100 + 150 + 100 + 150).