Real Estate Lingo
Real estate is a dynamic fi eld where new concepts, techniques, and phraseology regularly surface. A few years ago, who would have known about conduit loans, mezzanine fi nancing, infi nity returns, and segregated cost depreciation? It took some time for these fairly sophisticated techniques to be understood by those well versed in real estate investments.
A sampling of some key terms includes the following:

• Bottom fisherman: An investor who tries to buy below a bar-
gain price
• Bumps: Periodic increases in rent
• Ceiling: The maximum interest rate on an adjustable - rate
mortgage
• Condo reversion: A condo conversion building that reverts to
rental status
• Debt service: Mortgage payments that include principal and
interest
• Deal killer: A proposal that keeps a sales contract from being
consummated
• Dog: A worthless building
• Evergreen loan: A loan that is repeatedly renewed so that it
remains on the books indefinitely
• Firm price/firm offer: A sales price or a sales offer that is
nonnegotiable
• Flex space: A property containing a combination of ware-
houses and offices
• Floor: The minimum interest rate on an adjustable - rate mortgage.
. Going North Ascending values and/or ascending interest rates
• Going south: Declining values and/or declining interest rates
• Grandfathered: Describing a property out of conformance
with current zoning
• Growth rate: The annual percentage increase in the value of
a property
• Hard costs: Actual costs involved in the construction of a
building
• Hard money: A nonrefundable deposit
• Infinity return: A cash flow with no cash investment
• Knockdown: A building with little or no value that can be
razed to make room for a new building
• Segregated cost depreciation: Valuation of the different com-
ponents of a building
• Sleeper: A good deal about which most people are unaware
• Soft costs: All other costs apart from hard costs
• Steal: A bargain buy
• Sweetheart lease: A special deal extended to a tenant
• Turnaround: When a nonperforming property is transformed
into a successful one
• Turnover: The percentage of tenants that vacate a building
annually
• Wiggle room: The negotiating space for a price when there is
leeway on a deal