PMT
See payment.
PV
See present value.
Partially amortized mortgage loan
The payments do not repay the loan over its term and thus a lump sum (balloon) is required to repay the loan.
Participation mortgage
A loan secured by real property, with a stated interest rate that also provides for a share to the lender in annual net cash flow, gain on sale, or proceeds from refinancing the property.
(Real Estate Information Standards)
Passive income
Income from rental activity, limited business interests, or other activities in which the investor does not materially participate.
Passive losses
Losses from the ownership of passive investments.
Payment (PMT)
A periodic amount paid or received for two or more periods.
Percentage lease A lease in which the rent amount is based on a percentage of gross sales (monthly or annually) made by the tenant.
Percentage rent
The additional rent (over a base amount) that is paid by tenants to owners on tenant sales over a specified dollar amount. It is frequently found in retail leases. Also known as overage rent.
Perfect market
A market in which the products are homogenous, there is complete information, and no buyers or sellers may influence the market.
Physical depreciation or deterioration
A form or source of accrued depreciation considered in the cost approach to market value. The physical decay or deterioration of a property that may result from breakage, deferred maintenance, effects of age on construction material, and normal wear and tear. (Barron’s Dictionary of Real Estate Terms)
Physical limitations
Limitations imposed by the physical size, shape, or characteristics of a property or its level of development.
Pipeline information
Information (substantiated and rumored) regarding new inventory that is in the process of being added to the market by a specified forecast period.
Planned additional inventory
In reference to commercial real estate, it is the supply or stock of a specific type of commercial unit or the amount of space that will be available in an upcoming forecast period from expansions, conversions (in), and new construction.
Planned removed inventory
In reference to commercial real estate, it is the supply or stock of a specific type of commercial unit or the amount of space that will not be available in an upcoming forecast period due to demolitions and conversions (out).
Population growth
The rate at which a given population base in a given geographic area is growing (positive or negative) in relation to the forces of internal growth, in-migration, and out-migration; a factor that is widely acknowledged as having the greatest impact on the demand for housing.
Population migration
The movement and relocation of people from one place of residence to another in response to social and economic factors and forces; a long-term trend that can be expected to affect local economies and real estate values.
Population/expenditure approach
An approach to estimating the trade area (and sales/revenue potential) for a given retail establishment or center based on the minimum area (or threshold population) that would be required to sustain a business, by calculating the population necessary to support total square footage of both existing and proposed space for a specific-use and determining/mapping the extent of the trade area based on population density.
Portfolio income
Income from interest, dividends, royalties, or the disposition of property held for investment.
Positive leverage
Borrowed funds are invested at a rate of return higher than the cost of the funds to the borrower.
Potential rental income
The total amount of rental income for a property if it were 100 percent occupied and rented at competitive market rates.
Power center
This retail center is dominated by several large anchors, including discount department stores, off-price stores, warehouse clubs, or category killers—stores that offer tremendous selection in a particular merchandise category at low prices. The center typically consists of several freestanding (unconnected) anchors and only a minimum amount of small specialty
tenants.
Present value (PV)
The sum of all future benefits or costs accruing to the owner of an asset when such benefits or costs are discounted to the present by an appropriate discount rate.
Present value method
A comparison technique that compares the present values of the cash flows for any two real estate alternatives. The best user alternative is based on the lower present value amount. It is not the same as net present value.
Prestige and property classes
In reference to the recognition that various levels of status may be assigned to commercial properties as defined by user needs, the quality of a property and its amenities in relation to site factors, and its general location, suggesting the division of properties into distinct classes.
Price
The dollar amount that was offered, asked, or actually paid for a property.
Primary source data
Information obtained directly from field observations and survey instruments (by observing or monitoring a phenomenon or site firsthand), typically involving quantitative measurement and/or qualitative assessment of that which is observed or monitored.
Principal
The portion of a loan payment used toward reducing the original loan amount.
Probabilities and expected value
A quantifiable method of risk analysis. This method assigns probabilities to specific, possible investment outcomes, calculates an expected outcome for the investment based on these probabilities, and measures the likelihood that actual results will differ from the expected
Probabilities and expected value (continued)
outcome. This method of risk analysis can be applied directly to real estate investments. It also can be used in conjunction with the forecasts generated through sensitivity analyses. This technique requires that probabilities be assigned to possible outcomes. Probabilities on the best-case, most-likely, and worst-case scenarios can be assigned to the resulting expected values for the return. Variances also can be computed using the assigned
probabilities.
Production
Any economic activity that alters, enhances, or transforms a product or material, thereby increasing the value of that product or material by changing its physical form and/or location.
Property data
Property/site-specific information obtained from primary and secondary sources.
Property market
The supply and demand for ownership interests in property.
Property type
The classification of commercial real estate based on its primary use. The four primary property types are: retail, industrial, office, and multi-family residential.
Property-specific factors
Factors influenced by the site-specific and technical characteristics of a property or parcel including its layout, limitations, orientation, physical features, and ability to comply with government imposed zoning and land-use restrictions.
Proprietary data
Information obtained (usually at a cost) from private sources or firms that hold the exclusive rights to manufacture and distribute information created for specific commercial applications, supplying business, sales, and market-potential data and other information services to a targeted audience.
Purchasing power risk
The variability in the future purchasing power of income received from an investment.