Net operating income

Rental income from a property less the direct costs of operating it, before interest, tax and depreciation.

An office portfolio collecting ₹620 crore of rent with ₹145 crore of operating costs generates ₹475 crore of net operating income.

It is the real estate equivalent of operating profit, and it is the numerator of a capitalisation rate. Same-store net operating income growth, measured on properties held throughout both periods, is the sector's version of comparable sales growth.

Escalation clauses in leases make the growth partly contractual, which is what makes the asset class bond-like.