Education & Events

CRE Cash Flow Analyzing Income-Producing or Rental Real Estate

Oct 24, 2019
8425 Woodfield Crossing Blvd., Suite 155E
Program Overview: 

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Community banks continue to deal with commercial real estate (CRE) loans as a major portion of the loan portfolio.  Also, many borrowers continue to hold significant amounts of income-producing or rental real estate on their balance sheets.  Whether directly financing these assets or including the income stream(s) in your overall credit analysis, it is important to understand key analytical concepts in evaluating real estate cash flow.  And with real estate markets evolving, with some property types performing better than others, it is important to use the updated cash flow analysis as a part of ongoing loan monitoring and updating of collateral values – not in lieu of appraisals, but as interim and supplemental steps.

This program demonstrates (from case studies) the key variables and concepts for determining CRE cash flow, plus primary analytical techniques such as transaction-level stress-testing.  It also explores where to find information from existing sources, such as tax returns, and what additional information may be needed, such as customer rent rolls. 



  • Net operating income (NOI) concepts
  • Understanding key variables: vacancy, management fees and replacement reserves
  • Capitalizing the NOI to estimate value (direct capitalization and cap rates)
  • Using tax returns and customer rent rolls
  • Unique characteristics of the major types of commercial real estate
  • Stress-testing of debt service coverage (DSC) and
    determining break-even vacancy and interest rate
  • How to use a simple worksheet to explore the major issues
  • Recognizing other underwriting risks such as construction risk and lease overhang
  • Tips for reviewing commercial leases and key items to look for
  • Appendix items (time permitting)
    • Global cash flow (GCF) concepts and issues when analyzing multiple real estate properties
    • Brief overview of cash flow and valuation issues for residential rental properties



Richard Hamm has been training bankers for 27 years, designing and delivering courses specializing in commercial lending and credit, including portfolio and risk management, commercial real estate (CRE) and appraisals, plus selling and negotiating skills, and director training.  His clients include:

  • National associations such as the American Bankers Association (ABA) and the Risk Management Association (RMA)
  • Regional banking schools such as the Graduate School of Banking at Colorado and other major schools
  • State banking and community banking associations in ten states
  • Plus individual banks

He is based in Huntsville, AL and has owned/operated Advantage Consulting & Training for 13 years, after a 22-year banking career including senior positions in lending and credit, plus president during the formation of a community bank. He has BS and MBA degrees from the University of Alabama.


8:30 a.m.          Registration & Continental Breakfast
9:00 a.m.          Program Begins
12:00 p.m.         Lunch (included)
1:00 p.m.          Program Resumes
4:00 p.m.          Program Adjourns


Indiana Bankers Association
8425 Woodfield Crossing Blvd.
Suite 155E
Indianapolis, IN 46240


$225 IBA Member
$155 Each Additional IBA Member

Participation in IBA programs is limited to members, associate members, and nonmembers from an eligible membership category at applicable member or non-member rates. 100% Surcharge will be applied to NonMembers.

Additional Information: 

Commercial lenders, private bankers, small business lenders, commercial lenders, credit analysts, consumer and mortgage lenders, loan review specialists, special assets officers, lending managers and credit officers


Association Contact: 

Elizabeth DeHaven, Education Coordinator

Cancellation Policy: 

You will receive an e-mail confirmation at registration. If you have questions, contact Elizabeth DeHaven at 317-387-9380 or via e-mail at

Within three or more business days prior to the day of an educational program, no cancellation charge will be assessed. Within two days prior, 50% of the fee is assessed. Refunds are not provided for cancellations the day before or absences on the day of the program. Substitutions are welcome at anytime.

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