REIT Valuation: Net Asset Value Approach
Net asset value per share (NAVPS) is calculated by dividing what value by the number of shares in a REIT or REOC?
Not quite.
Forward NOI is useful for dividing by the capitalization rate in order to estimate property value, but this is just a piece of NAVPS.
You got it!
Net assets are assets minus liabilities. Property values are a large portion of firm assets in a REIT, but it will also have cash and accounts receivable, which are part of firm value.
No.
Using property values less liabilities would ignore some firm assets, such as cash, which are clearly part of firm value.
Forward NOI
Assets minus liabilities
Property values minus liabilities
