NCREIF has created three new data series derived from commercial properties that qualify for the flagship NCREIF Property Index (NPI). All properties in the NPI have been acquired and managed on behalf of tax-exempt institutional investors, principally pubic and private pension funds.
Whereas the NPI is market-weighted, the three new series presented here are equal-weighted (each property is equally represented in the data that are themselves averages of all qualifying properties) and as such are representative samples of operating performance of the universe of US commercial real estate.
Detailed discussions of the rationale and computations of these series may be found on the NCREIF web site linked below.
The Market Value Index (MVI) is a measure of the quarterly change in market value of each qualifying property.
The Free Cash Flow Yield (FCFY) is a measure of the amount of a property’s quarterly operating net cash flow available for distribution to investor/owners expressed as a fraction of market value.
The Capital eXpense Ratio (CXR) is a measure of the quarterly expenditures for on-going costs of business not accounted for in the Net Operating Income (NOI) including leasing commissions, tenant improvements, and other expenditures for replacement of long-lived equipment or physical structures, mostly tenant spaces, expressed as a fraction of market value.
The iPad version offers additional statistical measures including correlations among the data series across all property types.
The National Council of Real Estate Investment Fiduciaries (NCREIF) is an association of institutional real estate professionals in the United States.