Industrial real estate & investment glossary

Building & site

These terms describe the physical asset, site layout, and operating fit.

Clear height

Usable vertical height from the finished floor to the lowest overhead obstruction.

Column spacing

The distance between structural columns, important for racking, staging, equipment, and forklift movement.

Dock-high door

A loading door designed for trailers backed to a dock.

Drive-in door

A grade-level overhead door that lets vehicles enter the building or yard area.

Truck court

The paved maneuvering area outside dock doors where trucks back, turn, and queue.

Trailer parking

Outdoor spaces used to store trailers, subject to zoning, surface, screening, and lease limits.

Cross-dock

A building arranged for freight to move from inbound doors to outbound doors with limited storage time.

Rail-served

A property with rail access or a rail spur; service, rights, and track condition still need review.

ESFR sprinklers

Early Suppression Fast Response sprinklers used for certain high-piled storage conditions.

Slab load and flatness

Slab capacity and surface tolerance, often reviewed for heavy storage or narrow-aisle systems.

3-phase power

Industrial electrical service; verify voltage, amperage, transformer capacity, and utility availability.

Mezzanine

An intermediate platform or floor inside a building, subject to permits, structure, fire, and egress review.

Office finish %

The portion of a building improved as office space.

Flex space

A suite or building combining office, showroom, light industrial, storage, or service use.

IOS — industrial outdoor storage

Industrial outdoor storage means land used for storing vehicles, equipment, materials, containers, or trailers. It is highly dependent on zoning, screening, surface, access, and environmental controls.

Class A/B/C industrial

Informal market labels for relative quality, age, features, location, and tenant appeal.

Land-to-building ratio

The relationship between site area and building area.

Site coverage

The portion of a parcel covered by buildings and sometimes other impervious improvements.

Infill vs. greenfield

Infill sites are in developed areas; greenfield sites are undeveloped or less-developed land.

Leases

Lease language controls rent, expenses, risk, access, and remedies.

NNN / triple net

A lease where the tenant commonly pays base rent plus taxes, insurance, and operating expenses.

Gross lease

A lease where many property expenses are included in rent.

Modified gross

A lease between gross and net structures, with expenses divided by negotiated language.

CAM

Common area maintenance charges for shared property costs such as snow, landscaping, lighting, security, pavement, and management.

Base rent

Stated rent before pass-through expenses, credits, abatements, or other adjustments.

Escalations

Scheduled rent increases or expense adjustments. They may be fixed, percentage-based, index-based, or tied to operating costs.

TI allowance

Money a landlord contributes toward approved tenant improvements.

Leasing commission

Compensation paid for procuring a tenant or lease renewal.

Expense stop

A threshold where the landlord covers expenses up to a stated amount and the tenant pays certain increases above it.

Estoppel certificate

A tenant statement confirming key lease facts, defaults, deposits, options, and claims.

SNDA

A subordination, non-disturbance, and attornment agreement among a tenant, landlord, and lender.

Holdover

A tenant remaining after lease expiration, usually subject to lease consequences and remedies.

Renewal option

A contractual right to extend a lease if notice, timing, and default conditions are met.

ROFR / ROFO

Rights of first refusal or first offer that may affect sale or leasing flexibility.

WALT

Weighted average lease term measures remaining lease duration weighted by rent or area.

Rent roll

A summary of tenants, suites, area, rent, deposits, options, and lease dates.

Underwriting & investment

Investment terms simplify complex assumptions. Check the source model and period.

NOI

Net operating income is property income minus operating expenses before debt service and some capital items.

Cap rate

NOI divided by price or value; a shorthand income and risk measure, not a complete valuation.

Going-in vs. exit cap

Going-in cap rate uses current or first-year income; exit cap rate is a resale assumption.

DSCR

Debt service coverage ratio compares income available for debt payments to required debt service.

LTV

Loan-to-value compares loan amount to property value, purchase price, or another lender-defined base.

IRR

Internal rate of return estimates annualized return using the timing of cash flows.

Equity multiple

Total cash returned divided by total equity invested.

Cash-on-cash

Annual cash flow compared with cash invested, often after debt service and before taxes.

Basis

Basis can mean a tax basis, cost basis, or investor's all-in cost. Ask which definition is being used.

Replacement cost

The estimated cost to build a similar asset today.

Sale-leaseback

A transaction where an owner sells a property and leases it back.

Owner-user vs. investor

An owner-user buys to occupy; an investor buys for income, appreciation, redevelopment, or resale.

Value-add vs. core

Core usually describes stabilized assets with lower perceived risk. Value-add usually involves vacancy, rollover, improvements, repositioning, or other execution risk.

1031 exchange

A tax-deferred exchange with a 45-day identification period and 180-day exchange period, subject to detailed rules.

Qualified intermediary

A party used to facilitate a 1031 exchange and hold exchange proceeds.

LOI

A letter of intent outlining business terms before a purchase agreement or lease.

PSA

A purchase and sale agreement governing price, deposits, diligence, conditions, default, and closing.

Due diligence period

The agreed time for a buyer to inspect records, title, survey, environmental, physical, lease, zoning, and financing matters.

Earnest money

A buyer deposit governed by the PSA and escrow instructions.

Illinois & local records

Illinois property research depends on the correct county, municipality, township, and parcel.

PIN — property index number

A parcel identifier used in county tax and assessment records.

Assessed value & equalization factor

Assessed value is the figure a county assigns to a parcel for property-tax purposes; it is derived from, but is not the same as, market value or the tax bill. An equalization factor (multiplier) is applied by the county or the Illinois Department of Revenue so assessment levels are uniform across jurisdictions. Verify current figures with the county assessor and treasurer.

Triennial reassessment

Cook County reassesses property on a three-year cycle; verify timing and notices with the county assessor.

Township assessor

In most Illinois counties outside Cook, an elected township official who sets initial property values; the county supervisor of assessments then reviews and equalizes them. Start with the county office to find the right township contact.

Transfer tax

A tax that may apply at state, county, or municipal levels when real estate changes ownership.

Zoning map amendment

A legislative change to a parcel's zoning classification.

Special use

A use allowed only after specific local approval, often with conditions.

Variance

Relief from a zoning standard, such as a setback or parking requirement.

Unincorporated vs. incorporated

Whether property is outside or inside municipal boundaries, affecting zoning, permits, services, and records.

Enterprise zone

A designated area that may offer incentives if a project qualifies; eligibility must be verified.

TIF district

A tax increment financing district that captures certain future tax growth for eligible public purposes.

Phase I ESA / AAI

An environmental diligence report; EPA All Appropriate Inquiries guidance explains federal standards.

ALTA survey

A detailed survey used to review boundaries, easements, improvements, access, and title-related survey matters.

Title commitment

A title insurer's commitment to issue a policy subject to requirements and exceptions.

For broader local-record workflow, see the commercial property research guide and the nine-county industrial hub.