CCIM 101 — FINANCIAL ANALYSIS: QUESTIONS &
COMPLETE SOLUTIONS (2025/2026)
Introduction
CCIM 101 – Financial Analysis equips commercial-real-estate professionals with the
quantitative framework required to evaluate income-producing properties. The course
stresses time-value-of-money principles, discounted-cash-flow modelling, and
leverage mechanics that drive value in today’s capital markets. Mastery of NOI, cap
rates, IRR, NPV, cash-on-cash yields, and debt structuring allows practitioners to
compare assets, structure debt, and articulate risk-adjusted returns to equity partners
and lenders. The 2025/2026 edition reflects current market yields, SOFR-based debt
pricing, revised underwriting reserves, and ESG-driven expense trends used by
institutional investors.
Examination
Total questions: 50
Question 1:
A stabilized multi-tenant warehouse produces:
• Scheduled gross income: $1,800,000
• Vacancy & credit loss (5 %): -$90,000
• Operating expenses (NNN leases, tenant pays all): $0
• Management fee (3 % of EGI): $51,300
• Capital reserve: $0.15/psf × 300,000 psf = $45,000
What is the trailing NOI?
A. $1,613,700
B. $1,658,700
C. $1,704,000
D. $1,749,000
Answer: A. $1,613,700
Rationale: EGI = 1,800,000 – 90,000 = 1,710,000. Deduct management (51,300) and
reserve (45,000) → 1,710,000 – 51,300 – 45,000 = 1,613,700. NNN reimbursements
pass-through to owner; expenses are zero to landlord.
,Question 2:
Using Q1 NOI, an investor requires a 6.25 % going-in cap rate. The indicated value is
closest to:
A. $25.0 M
B. $25.8 M
C. $26.5 M
D. $27.2 M
Answer: B. $25.8 M
Rationale: V = NOI / r = 1,613,.0625 = $25,819,200 ≈ $25.8 M.
Question 3:
If market cap rates compress to 5.75 % at constant NOI, the value change is
approximately:
A. +8.0 %
B. +8.7 %
C. +9.4 %
D. +10.2 %
Answer: B. +8.7 %
Rationale: New value = 1,613,.0575 = $28.06 M; Δ = (28.06 – 25.82) / 25.82 = 8.7
%.
Question 4:
A property trades at $20 M with an NOI of $1.4 M. The terminal cap rate implied by the
sale is:
A. 6.50 %
B. 7.00 %
C. 7.14 %
D. 7.50 %
Answer: B. 7.00 %
Rationale: r = NOI / V = 1.4 M / 20 M = 0.07 → 7 %.
Question 5:
An office building has $3.2 M EGI, 42 % operating expense ratio, and $180,000 annual
CapEx reserve. NOI equals:
, A. $1,344,000
B. $1,524,000
C. $1,704,000
D. $1,884,000
Answer: B. $1,524,000
Rationale: 3.2 M × (1 – 0.42) = 1,856,000 – 180,000 = 1,524,000.
Question 6:
Using Q5 NOI, a lender underwrites at 1.25× DSCR and 5.5 % interest-only loan at 70 %
LTV. The maximum annual debt service is:
A. $1,219,200
B. $1,312,500
C. $1,399,500
D. $1,524,000
Answer: A. $1,219,200
Rationale: Max DS = NOI / DSCR = 1,524,.25 = $1,219,200.
Question 7:
With the same loan terms, the implied loan amount is:
A. $22.2 M
B. $22.9 M
C. $23.5 M
D. $24.1 M
Answer: A. $22.2 M
Rationale: Loan = DS / rate = 1,219,.055 = $22.17 M.
Question 8:
Equity investment is 30 % of value. If value is $31.7 M, equity cash-on-cash yield when
first-year cash flow after debt service is $1.2 M equals:
A. 11.1 %
B. 12.0 %
C. 12.6 %
D. 13.4 %
Answer: C. 12.6 %
Rationale: Equity = 0.30 × 31.7 M = 9.51 M; CoC = 1.2 M / 9.51 M = 12.6 %.
COMPLETE SOLUTIONS (2025/2026)
Introduction
CCIM 101 – Financial Analysis equips commercial-real-estate professionals with the
quantitative framework required to evaluate income-producing properties. The course
stresses time-value-of-money principles, discounted-cash-flow modelling, and
leverage mechanics that drive value in today’s capital markets. Mastery of NOI, cap
rates, IRR, NPV, cash-on-cash yields, and debt structuring allows practitioners to
compare assets, structure debt, and articulate risk-adjusted returns to equity partners
and lenders. The 2025/2026 edition reflects current market yields, SOFR-based debt
pricing, revised underwriting reserves, and ESG-driven expense trends used by
institutional investors.
Examination
Total questions: 50
Question 1:
A stabilized multi-tenant warehouse produces:
• Scheduled gross income: $1,800,000
• Vacancy & credit loss (5 %): -$90,000
• Operating expenses (NNN leases, tenant pays all): $0
• Management fee (3 % of EGI): $51,300
• Capital reserve: $0.15/psf × 300,000 psf = $45,000
What is the trailing NOI?
A. $1,613,700
B. $1,658,700
C. $1,704,000
D. $1,749,000
Answer: A. $1,613,700
Rationale: EGI = 1,800,000 – 90,000 = 1,710,000. Deduct management (51,300) and
reserve (45,000) → 1,710,000 – 51,300 – 45,000 = 1,613,700. NNN reimbursements
pass-through to owner; expenses are zero to landlord.
,Question 2:
Using Q1 NOI, an investor requires a 6.25 % going-in cap rate. The indicated value is
closest to:
A. $25.0 M
B. $25.8 M
C. $26.5 M
D. $27.2 M
Answer: B. $25.8 M
Rationale: V = NOI / r = 1,613,.0625 = $25,819,200 ≈ $25.8 M.
Question 3:
If market cap rates compress to 5.75 % at constant NOI, the value change is
approximately:
A. +8.0 %
B. +8.7 %
C. +9.4 %
D. +10.2 %
Answer: B. +8.7 %
Rationale: New value = 1,613,.0575 = $28.06 M; Δ = (28.06 – 25.82) / 25.82 = 8.7
%.
Question 4:
A property trades at $20 M with an NOI of $1.4 M. The terminal cap rate implied by the
sale is:
A. 6.50 %
B. 7.00 %
C. 7.14 %
D. 7.50 %
Answer: B. 7.00 %
Rationale: r = NOI / V = 1.4 M / 20 M = 0.07 → 7 %.
Question 5:
An office building has $3.2 M EGI, 42 % operating expense ratio, and $180,000 annual
CapEx reserve. NOI equals:
, A. $1,344,000
B. $1,524,000
C. $1,704,000
D. $1,884,000
Answer: B. $1,524,000
Rationale: 3.2 M × (1 – 0.42) = 1,856,000 – 180,000 = 1,524,000.
Question 6:
Using Q5 NOI, a lender underwrites at 1.25× DSCR and 5.5 % interest-only loan at 70 %
LTV. The maximum annual debt service is:
A. $1,219,200
B. $1,312,500
C. $1,399,500
D. $1,524,000
Answer: A. $1,219,200
Rationale: Max DS = NOI / DSCR = 1,524,.25 = $1,219,200.
Question 7:
With the same loan terms, the implied loan amount is:
A. $22.2 M
B. $22.9 M
C. $23.5 M
D. $24.1 M
Answer: A. $22.2 M
Rationale: Loan = DS / rate = 1,219,.055 = $22.17 M.
Question 8:
Equity investment is 30 % of value. If value is $31.7 M, equity cash-on-cash yield when
first-year cash flow after debt service is $1.2 M equals:
A. 11.1 %
B. 12.0 %
C. 12.6 %
D. 13.4 %
Answer: C. 12.6 %
Rationale: Equity = 0.30 × 31.7 M = 9.51 M; CoC = 1.2 M / 9.51 M = 12.6 %.
