Words / C / Business

cap rate

noun/kæp reɪt/

B2CEFR level
75/100Rarity: rare
TechnicalRegister

The ratio of a property's annual net operating income to its purchase price or value, used to gauge return.

At a cap rate of just four percent, the trophy office tower looked richly priced to the acquisitions team.

Similar: capitalisation rate

Topic: Real estate & property in Business English

Rarity runs from 0 (a word everyone knows) to 100 (almost never seen outside specialist or literary writing). Level is the word's real difficulty on the CEFR scale, from A1 to C2.

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