Real Estate - Land and everything more or less attached to it. Ownership below to the center of the earth and above to the heavens.
Real Estate Broker - A person licensed to act as an agent for another person or business to negotiate a lease or purchase of a leasehold or property, respectively, for a fee.
Real Estate Investment Trust (REIT) - A real estate mutual fund, established by income tax laws to avoid the corporate income tax. It sells shares of ownership and must invest in real estate or mortgages. It must meet certain other requirements, including minimum number of shareholders, widely dispersed ownership, and certain asset and income tests.
Real Estate Market - The potential buyers and sellers of real property at the current time. It includes markets for various property types, such as office market, housing market, land market and condominium market.
Real Property - The land and anything permanently attached to the land such as buildings, parking lots, landscaping, or other items which would otherwise be classified personal property if not attached, excluding fixtures designed to be removable and reusable (see "trade fixtures").
Reconveyance - An instrument used to transfer title from a trustee to the equitable owner of real estate, when title is held as collateral security for a debt. Most commonly used upon payment in full of a trust deed. Also called a deed of reconveyance or release.
Recourse - The ability of a lender to recover money from a borrower in default, in addition to the property pledged as collateral.
Rehabilitation Tax Credit - The Tax Reform Act of 1986 provides a 20tax credit for rehabilitating certified historic structures, and a 10credit for other buildings that were placed in service after 1936.
Renewal Option - Lease language that provides the means for tenant to give landlord notice of its intent to renew (extend) the lease.
Replacement Reserve - Various account(s) maintained (typically by the Lender) to provide funds for anticipated expenditures required to maintain a building. A reserve account usually is required by a lender in the form of an escrow to pay upcoming taxes and insurance costs. A replacement reserve may be maintained to provide for replacement cost of short-lived components, such as carpets, heating equipment or roofing. Also, a tenant improvement and leasing commission account may be required for future changes in tenancy.
Reinsurance - A contract which one insurer makes with another to protect the first insurer, wholly or partially, against loss or liability by reason of a risk under a separate and distinct contract as insurer of a third party. Reinsurance differs from coinsurance in that, in the case of reinsurance, only one insurer has a direct contractual relationship with the insured, and that insurer (commonly referred to as the "lead insurer") purchases reinsurance in order to lessen or spread the risk. The "lead insurer" will assume a risk up to a limit (the amount of which is referred to as the "retention") and any loss which exceeds this limit would be borne by the reinsurers. In the case of coinsurance, each coinsurer has a direct contractual relationship with the insured, and the risk is shared in agreed-upon proportions from the first dollar of loss.
Rent Commencement Date - The date upon which the rent and usually the term of the lease begins. May be different from the lease commencement date when certain obligations must be fulfilled such as the construction of tenant improvements.
Rentable area - Denotes the number of square feet in a commercial building deemed to be rentable, according to BOMA. May include a common area load factor or allowance for building amenities such as hallways and lavatories.
Request for Proposal (RFP) - A formal request, issued by a plan sponsor or its consultant, inviting investment managers to submit information on their firms' investment strategy, historical investment performance, current investment opportunities, investment management fees, other pension fund client relationships, etc. Firms that meet the qualifications are requested to make a formal presentation to the board of trustees and senior staff members. Finalists are chosen at the completion of this process, and contract negotiation begins.
Reserve Agreement - The Delegated Underwriting and Servicing Reserve Agreement. This is a contractual agreement among Fannie Mae, the custodian, and the lender, in which the lender agrees to establish a lender reserve and to pledge collateral to Fannie Mae to secure the lender's obligations under Delegated Underwriting and Servicing. The Reserve Agreement also gives Fannie Mae contractual rights in the pledged reserve and provides Fannie Mae certain contract remedies to enforce the reserve requirements.
REVPAR (Revenue per Room) - Calculation is in underwriting (usually hotels) where the gross income is divided by the total number of rooms available (both occupied and unoccupied).
Right of Way - (1) The right to pass over property owned by another, usually based upon an easement. (2) A path or thoroughfare over which passage is made. (3) A strip of land over which facilities such as highways, railroads or power lines are built.