{
  "id": "debt-yield",
  "version": "c8ab0540ba4b",
  "status": "published",
  "name": "Debt Yield Calculator",
  "question": "What is the debt yield?",
  "summary": "Computes the debt yield of a commercial real estate loan, net operating income as a percent of the loan amount, or the loan or NOI from the other two.",
  "category": "finance",
  "subcategory": "mortgage-and-real-estate",
  "url": "https://www.acalculator.org/finance/debt-yield-calculator",
  "markdown": "https://www.acalculator.org/finance/debt-yield-calculator.md",
  "kind": "formulas",
  "method": "Debt yield = NOI ÷ loan amount × 100; loan amount = NOI ÷ debt yield × 100; NOI = debt yield × loan amount ÷ 100.",
  "assumptions": [
    "NOI is the yearly net operating income: income from the property minus its operating expenses, before debt service, capital spending and income tax.",
    "The loan amount is the whole loan (or its balance) secured by the property.",
    "Arithmetic is exact on the typed decimals; the debt yield shows to 2 decimals and money to the cent, halves up."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "noi": {
        "title": "Net operating income (NOI)",
        "description": "The property’s yearly income from rents and other operations minus its operating expenses, before debt payments.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 1000000000000000
      },
      "loan": {
        "title": "Loan amount",
        "description": "The amount of the loan, or the balance owed on it.",
        "type": "number",
        "x-unit": "USD",
        "exclusiveMinimum": 0,
        "maximum": 1000000000000000
      },
      "dy": {
        "title": "Debt yield",
        "description": "NOI ÷ loan amount × 100.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 1000
      }
    }
  },
  "solve": {
    "fillAny": 2,
    "variables": [
      "noi",
      "loan",
      "dy"
    ],
    "inputsOnly": []
  },
  "outputs": {
    "noi": {
      "label": "Net operating income (NOI)",
      "description": "The yearly NOI: debt yield × loan amount ÷ 100, to the cent.",
      "format": "money"
    },
    "loan": {
      "label": "Loan amount",
      "description": "The loan amount: NOI ÷ debt yield × 100, to the cent.",
      "format": "money"
    },
    "dy": {
      "label": "Debt yield",
      "description": "NOI ÷ loan amount × 100, to 2 decimals.",
      "format": "percent"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "noi": 900000,
      "loan": 10000000
    },
    "outputs": {
      "dy": 9
    },
    "text": "An NOI of $900,000.00 on a loan of $10,000,000.00 is a debt yield of 9%."
  },
  "examples": [
    {
      "given": {
        "noi": 900000,
        "loan": 10000000
      },
      "expect": {
        "dy": 9
      },
      "source": "BANK5 2023-5YR2, Commercial Mortgage Pass-Through Certificates, final prospectus filed under Rule 424(b)(2) by Morgan Stanley Capital I Inc., 2023, \"Underwritten NOI Debt Yield\" (the related Underwritten NOI divided by the Cut-off Date Balance of that Mortgage Loan). https://www.sec.gov/Archives/edgar/data/1547361/000153949723001217/n3498_x11-424b2.htm; hand calculation in content.mdx: 900,000 ÷ 10,000,000 × 100 = 9"
    },
    {
      "given": {
        "noi": 500000,
        "dy": 10
      },
      "expect": {
        "loan": 5000000
      },
      "source": "BANK5 2023-5YR2, Commercial Mortgage Pass-Through Certificates, final prospectus filed under Rule 424(b)(2) by Morgan Stanley Capital I Inc., 2023, \"Underwritten NOI Debt Yield\" (the related Underwritten NOI divided by the Cut-off Date Balance of that Mortgage Loan). https://www.sec.gov/Archives/edgar/data/1547361/000153949723001217/n3498_x11-424b2.htm, worked back; hand calculation in content.mdx: 500,000 ÷ 10 × 100 = 5,000,000"
    },
    {
      "given": {
        "loan": 8000000,
        "dy": 8.5
      },
      "expect": {
        "noi": 680000
      },
      "source": "BANK5 2023-5YR2, Commercial Mortgage Pass-Through Certificates, final prospectus filed under Rule 424(b)(2) by Morgan Stanley Capital I Inc., 2023, \"Underwritten NOI Debt Yield\" (the related Underwritten NOI divided by the Cut-off Date Balance of that Mortgage Loan). https://www.sec.gov/Archives/edgar/data/1547361/000153949723001217/n3498_x11-424b2.htm, worked back; hand calculation in content.mdx: 8.5 × 8,000,000 ÷ 100 = 680,000"
    },
    {
      "given": {
        "noi": 1234567.89,
        "loan": 9876543.21
      },
      "expect": {
        "dy": 12.49999988609375
      },
      "source": "BANK5 2023-5YR2, Commercial Mortgage Pass-Through Certificates, final prospectus filed under Rule 424(b)(2) by Morgan Stanley Capital I Inc., 2023, \"Underwritten NOI Debt Yield\" (the related Underwritten NOI divided by the Cut-off Date Balance of that Mortgage Loan). https://www.sec.gov/Archives/edgar/data/1547361/000153949723001217/n3498_x11-424b2.htm; hand calculation in content.mdx: 1,234,567.89 ÷ 9,876,543.21 × 100 = 12.4999998860937… (exact 1371742100/109739369, Python Fraction), shown as 12.5%"
    }
  ],
  "sources": [
    "BANK5 2023-5YR2, Commercial Mortgage Pass-Through Certificates, final prospectus filed under Rule 424(b)(2) by Morgan Stanley Capital I Inc. (2023), \"Description of the Mortgage Pool\": Underwritten NOI Debt Yield is the Underwritten NOI divided by the Cut-off Date Balance of the mortgage loan; Underwritten NOI is assumed revenue less operating expenses and fixed expenses such as insurance and real estate taxes, before capital expenditures; the pool's range of debt yields is 10.4% to 19.2% (weighted average 13.9%). https://www.sec.gov/Archives/edgar/data/1547361/000153949723001217/n3498_x11-424b2.htm (retrieved 2026-10-19, read in a browser)"
  ],
  "related": [
    "dscr",
    "cap-rate",
    "commercial-mortgage",
    "ltv"
  ],
  "changelog": []
}