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Parking ratio
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Dividing the total rentable square footage of a building by the building's total number of parking spaces provides the amount of rentable square feet per each individual parking space.
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Parlor Floor
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This is the second floor in a townhouse. In its original form, the building's front steps accessed the parlor floor. The parlor is traditionally the grandest floor in the townhouse and almost always has the building's highest ceilings. Historically, these floors were primarily used for entertaining with two rooms separated by a staircase. These rooms were usually Living Rooms, Libraries or Formal Dining Rooms.
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Partial Claim
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a loss mitigation option offered by the FHA that allows a borrower, with help from a lender, to get an interest-free loan from HUD to bring their mortgage payments up to date.
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Partial sales
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The sale of an interest in real estate that is less than the whole property. This may include a sale of easement rights, parcel of land or retail pad, or a single building of a multi-building investment.
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Partial taking
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The taking of part of an owner's property under the laws of eminent domain
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Partial Views
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Views that offer angled or partial (obscured) perspectives of local landmarks or landscape features (park, waterfront, oceanfront, etc.)
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Participating debt
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In addition to collecting a contract interest rate, participating debt allows the lender to have participatory equity rights through a share of increases in income and/or increases in residual value over the loan balance or original value at the time of loan funding.
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Party in interest
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Under ERISA's 2002 Modernization Act: Parties in interest include employers, unions and, in certain circumstances, fiduciaries. It excludes service providers and their affiliates. Fiduciaries would only be parties in interest where they act on behalf of a plan sponsor in entering into a transaction. An affiliate of a party in interest does not include remote affiliates of employers, unions and fiduciaries (e.g., 10 percent owners), as well as employees of such remote affiliates.
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Pass-through certificate
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Payments of principal and interest from the underlying pool of mortgages are passed through to the holders of the certificates.
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Pass-through Kitchen
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This term refers to a Kitchen with an opening from the Kitchen into another room in the apartment, usually a Dining Area or Living Room
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Payment cap
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A limit on the amount a monthly payment can increase on an adjustable rate mortgage.
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Payment Change Date
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The date when a new monthly payment amount takes effect on an adjustable-rate mortgage (ARM) or a graduated-payment mortgage (GPM). Generally, the payment change date occurs in the month immediately after the adjustment date.
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Payout ratio
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The percentage of the primary earnings per share, excluding extraordinary items, paid to common stockholders in the form of cash dividends during the trailing 12 months
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Pension liability
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The total amount of capital required to fund vested pension fund benefits
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Percentage rent
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Rent payable under a lease that is equal to a percentage of gross sales or gross revenues received by the tenant. It is commonly used in retail center leases.
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Per-diem interest
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Interest charged or accrued daily.
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Performance
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The quarterly changes in fund or account values attributable to investment income, realized or unrealized appreciation, and the total gross return to the investors both before and after investment management fees. Formulas for calculating performance information are varied, making comparisons difficult.
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Performance bond
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A surety bond posted by a contractor guaranteeing full performance of a contract with the proceeds to be used to complete the contract or compensate for the owner's loss in the event of nonperformance
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Performance measurement
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The process of measuring an investor's real estate performance in terms of individual assets, advisers/managers and portfolios. The scope of performance measurement reports varies among managers, consultants and plan sponsors.
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Performance-based fees
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Fees paid to advisers or managers based on returns to investors, often packaged with a modest acquisition and asset-management fee structure
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Periodic Payment Cap
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A limit on the amount that payments can increase or decrease during any single adjustment period.
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Periodic Rate Cap
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A limit on the amount that the interest rate can increase or decrease during any one adjustment period, regardless of how high or low the index might be.
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Permanent loan
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The long-term mortgage on a property
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Pet Policy
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Each building has a pet policy particular to that building. This can vary from a strict no pet policy to a more liberal pet policy in which tenant or owner can harbor as many pets as he/she desires. Some particularisms to different pet policies may includes the following: No dogs, weight limits on dogs, no pets on sublets, board interviews of pets or pets by written permission of the board.
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Pied à terre
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Translated literally from the French, pied à terre means foot on the ground. In English, we would call it a "landing pad." A pied à terre is a small, comfortable apartment maintained by someone who resides in another city. Usually, the owner has a career that requires them to be in New York several days per month, or even per week. The pied à terre allows its owner to avoid the daily commute, or to spend occasional late nights in the city. However, these apartments can also be kept by the well-heeled who simply enjoy having access to the exciting culture and glamorous society found in major cities.
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PITI
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Principal, Interest, Taxes, and Insurance - the four elements of a monthly mortgage payment; payments of principal and interest go directly towards repaying the loan while the portion that covers taxes and insurance (homeowner's and mortgage, if applicable) goes into an escrow account to cover the fees when they are due.
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PITI (principal, interest, taxes, and insurance)
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A payment amount calculated by a mortgage lender to include the total payment of all principal, interest, taxes and insurance due monthly.
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Plan assets
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The assets of a pension plan
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Plan sponsor
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The entity that establishes, contributes to and is responsible for the administration of an employee benefit plan, often used interchangeably to describe staff who administer the plan and trustees or investment board members who govern it
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Plat
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Map of a specific area, such as a subdivision, that shows the boundaries of individual lots together with streets and easements
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Pledged Account Mortgage (PAM)
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A type of mortgage that is tied to a pledged savings account and this fund (plus earned interest) is gradually used to reduce mortgage payments.
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PMI
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Private Mortgage Insurance; privately-owned companies that offer standard and special affordable mortgage insurance programs for qualified borrowers with down payments of less than 20% of a purchase price.
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Point
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Fees charged by a lender to provide a lower interest rate. One point equals one percent (1%) of the loan amount. Also referred to as a discount point.
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Portfolio management
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The portfolio management process involves formulating, modifying and implementing a real estate investment strategy in light of an investor's broader overall investment objectives. It also can be defined as the management of several properties owned by a single entity.
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Portfolio turnover
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The average time from the funding of an investment until it is repaid or sold
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Possession
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This term refers to the time (month and day) that a new purchaser or a new tenant can actually take possession of an apartment.
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Post-War
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Refers to buildings built after World War II. Post-war building needs and modern building techniques dramatically altered the composition of the middle and upper-class apartment house. Apartment houses were built in a "plain vanilla" style with lower ceilings, fewer moldings and details, an absence of fireplaces and reduced room proportions. The exterior of the New York apartment house also saw dramatic change. Plain red and white brick exteriors replaced the ornate limestone detailing of the pre-war apartment house.
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Powder Room
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Refers to a bathroom with no bath or shower. A powder room is also commonly referred to as half-bath.
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Power of sale
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Clause inserted in a mortgage or deed of trust giving the mortgagee (or trustee) the right and power, upon default in the payment of the debt secured, to advertise and sell the property at public auction
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Pre-approval
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A thorough assessment made by a lender of a potential borrower's ability to pay for a home and a confirmation of the amount to be borrowed. The completion of a loan application is necessary to close the loan.
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Pre-approval letter
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A letter from a lender that states the amount of money a potential buyer can obtain.
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Pre-approve
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lender commits to lend to a potential borrower; commitment remains as long as the borrower still meets the qualification requirements at the time of purchase.
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Preferred shares
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Stocks that have prior claim on distributions (and/or assets in the event of dissolution) up to a definite amount before the common shareholders are entitled to anything. As a form of ownership, preferred shareholders fall behind all creditors in dissolutions.
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Pre-foreclosure sale
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Allows a defaulting borrower to sell the mortgaged property to satisfy the loan and avoid foreclosure.
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Preleased
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Space in a proposed building that has been leased before the start of construction or in advance of the issuance of a certificate of occupancy
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Premium
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An amount paid on a regular schedule by a policyholder that maintains insurance coverage.
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Prepaid expenses
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Expenses including taxes, insurance, and assessments that are paid before the due date.
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Prepaid fees
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Funds collected by the lender from the borrower to pay certain recurring items in advance, including interest, property taxes, hazard insurance and, if applicable, private mortgage insurance (PMI).
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Prepaid interest
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Interest paid before it is due.
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Prepayment
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Payment of the mortgage loan before the scheduled due date; may be subject to a prepayment penalty.
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Prepayment penalty
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A penalty that a lender may impose on a borrower who pays a loan off before its expected end date.
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Prepayment rights
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Rights given to the borrower to make partial or full payment of the total principal balance prior to the maturity date without penalty
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Prequalification
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A lender's preliminary assessment of a buyer's ability to pay for a home and an estimate of how much the buyer may borrow.
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Pre-qualify
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A lender informally determines the maximum amount an individual is eligible to borrow.
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Pre-War
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Refers to buildings built prior to the start of World War II. Some common elements of these structures include hardwood floors, moldings, high ceilings and fireplaces.
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Price to earnings ratio
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This ratio is calculated by dividing the current share price by the sum of the primary earnings per share from continuing operations, before extraordinary items and accounting changes, over the past four quarters.
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Primary issuance
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The initial financing of an issuer
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Prime space
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Typically refers to first-generation space that is available for lease
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Prime tenant
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The major tenant in a building, or the major or anchor tenant in a shopping center
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Principal
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The amount borrowed from a lender; doesn't include interest or additional fees.
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Principal
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The amount of money originally borrowed in a mortgage, minus any payments made subsequently.
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Principal paid over life of loan
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The sum of scheduled principal payments calculated by the lender to equal the face amount of the loan.
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Principal payments
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The return of invested capital to the lender
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Principle of conformity
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The idea that a house will more likely appreciate in value if its size, age, condition and style are similar to other houses in the neighborhood.
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Private mortgage insurance (PMI)
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A form of insurance required by a lender when the borrower's down payment or home equity percentage is less than 20 percent of the home value.
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Private placement
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A sale of a security in a manner that is exempt from the registration rules and requirements of the Securities and Exchange Commission. An example would be a REIT directly placing an issue of stock with a pension fund.
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Private REIT
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An infinite- or finite-life real estate investment company structured as a real estate investment trust. Shares are placed and held privately rather than sold and traded publicly
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Pro rata
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In the case of a tenant, the proportionate share of expenses for the maintenance and operation of the property
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Processing fee
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A fee charged by some lenders for gathering information necessary to process the loan.
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Production acres
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The area of land that can be used in agriculture or timber operations to produce income, not including areas used for crop or machinery storage, or other support areas
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Professional Space
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Office space set aside in a residential building for use by professionals, usually in the medical field. Professional space does not refer to attorneys or architects. The strict interpretation is for the medical profession. Similar to maisonettes, these spaces can have separate street entrances as well as lobby entrances.
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Prohibited transaction
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ERISA defines the following transactions as prohibited between a pension plan and a party in interest: the sale, exchange or leasing of any property; a loan or other extension of credit; and the furnishing of goods or services. Other prohibited transactions include the transfer of plan assets to a party in interest or use of plan assets by a party in interest, and the acquisition of employer real property in excess of limits set by ERISA.
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Property tax
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Tax paid on privately owned property. Property taxes are usually paid semiannually, or monthly if the lender requires. The amount is based on local tax rates and assessed property value.
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Prudent man rule
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The standard to which a fiduciary is held accountable under ERISA. "Act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of a like character and with like aims."
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Pullman or Petite Kitchen
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This type of kitchen is most often found in small apartments and are situated against a single wall. Usually these kitchens are no bigger than the size of a closet and consist of a refrigerator (full or half), an oven and a sink. This type of kitchen does not count as a room when counting apartment rooms. Many of these kitchens are found in pre-war buildings that were originally constructed as hotels.
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Punch list
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An itemized list documenting incomplete or unsatisfactory items after the contractor has notified the owner that the tenant space is substantially complete
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Purchase-money mortgage (PMM)
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A mortgage obtained by a borrower as partial payment for a property.
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