Projected Rent Spikes: Can You Have the Good Without the Bad?(Author Abstract) (Report‪)‬

ABSTRACT The accelerated nature of the last real estate cycle was partially fueled by investors' and analysts' expectations of aggressive rent projections. By examining the historical record of rent growth and the likelihood of achieving market rent increases, appraisers, investors, and analysts can add a dose of reality to their forecasting assumptions. Understanding the impact of rent spikes in cash flow projections is critical to gauging the inherent risk and selecting the corresponding discount rate for projections as the next cycle emerges.