Investor Tools
Cap Rate Calculator
Calculate capitalization rate, implied value, or required NOI for any commercial real estate investment. Instant calculations with 2026 Florida cap rate reference by asset class.
What do you want to calculate?
Cap Rate
6.25%
$125,000 / $2,000,000 = 6.25%
2026 Florida Cap Rate Reference
| Asset Type | Typical Cap Rate |
|---|---|
| Chick-fil-A (ground lease) | 3.75% - 4.75% |
| McDonald's (ground lease) | 4.50% - 5.25% |
| Starbucks NNN | 4.75% - 5.50% |
| AutoZone / O'Reilly NNN | 5.25% - 6.00% |
| CVS Pharmacy | 5.50% - 6.50% |
| Dollar General NNN | 5.75% - 6.50% |
| Walgreens Pharmacy | 6.00% - 7.00% |
| Family Dollar NNN | 6.00% - 6.75% |
| Multifamily Class A | 5.00% - 5.75% |
| Industrial / Warehouse | 5.50% - 6.50% |
| Retail Shopping Center | 6.50% - 7.50% |
| Suburban Office | 7.00% - 8.50% |
| Medical Office Building | 6.00% - 6.75% |
What Is a Cap Rate?
Capitalization rate (cap rate) is the ratio of a property's Net Operating Income (NOI) to its purchase price or current value. It's the most widely used metric for comparing commercial real estate investments — essentially the unlevered yield of the property.
Cap Rate = NOI ÷ Purchase PriceHow to Use Cap Rates
Compare Properties
At the same cap rate, two properties with similar NOIs should trade at similar prices. Different cap rates reflect perceived risk, location quality, tenant credit, and lease term.
Estimate Value from NOI
If you know a property's NOI and the typical cap rate for its asset class, you can estimate value. This is how appraisers apply the 'income approach' to valuation.
Set an Offer Price
Divide the NOI by your target cap rate to determine your maximum offer price. If market cap rates are 6.0% and NOI is $120K, offer no more than $2M.
Understand Market Dynamics
Cap rates move inversely with prices. When cap rates compress (go down), prices rise. When cap rates expand (go up), prices fall. Interest rates, tenant demand, and investor sentiment drive cap rate movement.
Cap Rate Limitations
Cap rate is a snapshot — it doesn't account for future rent growth, leverage, tax benefits, tenant credit changes, or capital expenditures. Always combine cap rate analysis with cash-on-cash return, DSCR, IRR projections, and tenant credit analysis for a complete picture.
Ready for a Full Deal Analysis?
Cap rate is just the start. Use our Deal Analyzer for a complete institutional-grade underwriting with IRR, DSCR, cash-on-cash, and sensitivity analysis.