GLOSSARY OF TERMS - G

An evaluation of the difference in the demand and supply of space (measured in terms of square footage) for a particular type of commercial property in a given market area where gaps are expressed as the amount of square footage demanded less the amount of square footage available in a given time period. Note that if demand exceeds supply, the gap will be positive. A positive gap indicates that potential opportunities exist for successful commercial real estate transactions. However, transactions might be avoided when supply exceeds demand (or when a negative gap occurs), as there is an oversupply of available space in the market.

Represents the principal in a broad range of matters related to a particular business or activity, i.e. property manager for the owner.

A gap analysis that is carried out for a city or several cities (simultaneously) to identity one or more general market areas where a gap exists for a particular type of commercial real estate.

Factors influenced by the demographic, economic, and location characteristics of a market.

The person who acquires the title.

The owner who transfers the title. Must have legal capacity.

The total floor area designed for tenant occupancy and exclusive use, including basements, mezzanines, and upper floors, and it is measured from the center line of joint partitions and from outside wall faces. GLA is that area on which tenants pay rent; it is the area that produces income.

A lease in which all expenses associated with owning and operating the property are paid by the landlord.

The total income generated by the operations of a property before payment of operating expenses.

A method investors may use to determine market value. This method calculates the market value of a property by using the gross rents divided by the price for the property. Frequently used in small apartment building and hotels.

The terms "gross" and "full-service" indicate that both the base rental charge and the availability of the basic services necessary to comfortably occupy space are included in the rental rate. Generally provides for inclusion of: all utilities (except telephone and internet/cable/fiber service) including heat and air-conditioning in season; electricity for power, plugs and illumination; water for drinking and lavatory purposes; service for tenant interiors and building common areas; landscaping and snow removal, base property taxes, building insurance and building security, if any. The tenant remits one (rent) check every month, which covers the cost of occupying space within the building; except as mutually agreed.

A lease of land only, on which the tenant usually owns a building or is required to build as specified in the lease. Such leases are usually long-term net leases; the tenant's right and obligations continue until the lease expires or is terminated through default.

In reference to the patterns of urban or population growth in a geographic market, an important consideration in retail trade area analyses as growth patterns are known to affect sales/revenue potential within a market given the tendency of retail to follow population movement and income concentrations over time.

Agreement where the guarantor assures satisfaction of another if certain acts occur or fail to occur. Need to define the nature of the guarantee and the source of the funds if a repayment is needed. A guarantee or master lease won't fix a poorly performing property. In real estate it is best to look at the quality of the property and deal structure for security.