income-valuation
Institutional income capitalization pro-formas, built in seconds.
Normalize the operating statement, apply market vacancy and capitalize NOI the way a hearing officer expects.
| Potential gross income | $5,646,800 |
| Vacancy and collection 19% | -$1,072,892 |
| Allowable expenses | -$1,894,650 |
| Reserves $0.30/sf | -$44,580 |
| NOI | $2,634,678 |
| Loaded cap 7.50% + 4.6% | 12.10% |
Indicated value
$21,774,198
$146.53 / sf vs notice $181.02 / sf
Assessors' income models assume a building you do not own.
Vacancy set at the submarket average
Mass appraisal income models apply a typical vacancy rate. A building that lost its anchor or sits in a weaker micro-location carries a value it cannot earn.
Expense ratios from a table
Assessor schedules use fixed expense ratios by class. They miss rising insurance, utilities and the real cost of running an older asset.
Tenant costs ignored
Free rent, tenant improvement allowances and leasing commissions reduce what an investor will pay. Many models leave them out entirely.
The normalization engine
- Chart of accounts mappings
- 212
- Cap rate build-ups
- Band of investment, market extraction
- Exhibit pages
- 4
- Formula
- V = NOI / (R0 + ETR)
Methodology mirrors the income capitalization approach as taught in Appraisal Institute coursework and recognized under USPAP Standard 1. Models are reviewed by a Certified General Real Estate Appraiser before each release.
- 1
Ingest rent rolls and P&Ls
Upload Yardi, MRI, RealPage or AppFolio exports, or a spreadsheet. Accounts are mapped to a standard chart: rental income, reimbursements, other income and each expense category.
- 2
Strip non-allowable items
Debt service, depreciation, amortization, income taxes and owner entity costs are removed. Capital items are moved to reserves; leasing commissions and TI are treated per jurisdiction practice.
- 3
Apply market evidence
Contract rent is tested against market rent, actual vacancy against market vacancy, and the higher supportable vacancy and collection loss is applied with a cited source.
- 4
Capitalize correctly
NOI is capitalized at a base rate from your submarket evidence. Where real estate taxes are excluded from expenses, the effective tax rate is added to form a loaded cap rate.
Income Valuation questions
Next module: Sales CompsShould I use actual or market income?
Most jurisdictions value the fee simple interest at market levels, so the engine shows both and defaults to market rent and market vacancy unless actual figures are lower and supportable. You can override with a documented reason.
How are leasing commissions and tenant improvements handled?
By default they are treated as below-the-line capital costs and normalized into an annual reserve. Jurisdiction profiles adjust this where local practice differs.
Can I export the pro-forma to Excel?
Yes. Every pro-forma exports to a formatted workbook with live formulas, and to the PDF exhibit in the evidence binder.
Stop overpaying commercial property tax on a flawed mass appraisal.
Upload an assessment notice. ATALI ELECTRIC returns a valuation audit and comp analysis in about two minutes.