Commercial Real Estate Debt Yield Calculator
Compute commercial real estate debt yield as annual NOI divided by loan amount, with an optional NOI stress input for conservative underwriting.
Illustrative underwriting support only. Confirm debt-yield definitions and covenant thresholds with your lender and legal documents.
Examples
- NOI $1,250,000.00 and loan amount $12,500,000.00 with default stress => Debt yield 10.00%.
- NOI $960,000.00, loan amount $14,000,000.00, NOI stress -8.00% => Debt yield 6.31% based on stressed NOI of $883,200.00.
FAQ
Why do lenders use debt yield alongside DSCR?
Debt yield gives a rate-independent view of collateral performance, while DSCR can look stronger or weaker depending on interest rates and amortization terms.
What debt yield level is commonly required?
Thresholds vary by asset class and market cycle, but many lenders target roughly 8% to 12% for stabilized assets.
Should I use trailing or stabilized NOI?
Use the NOI basis required by your credit process, and disclose whether the figure is trailing, run-rate, or fully stabilized.
Additional Information
- Debt yield is an unlevered risk metric that does not depend on interest rate or amortization assumptions.
- NOI should exclude one-time items and align with lender underwriting adjustments.
- Optional NOI stress defaults to 0.00% and can be left blank without breaking the calculation.