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Glossary of Real Estate Terms
Sale-leaseback
An arrangement by which the owner-occupant of a property agrees to sell all or part of the property to an investor, then lease it back and continue to occupy space as a tenant
Sales comparison value
A value indication derived by comparing the property being appraised to similar properties that have been sold recently
Second-generation or secondary space
Previously occupied space that becomes available for lease, either directly from the landlord or as sublease space
Secondary financing
A loan on real property secured by a lien junior to an existing first mortgage loan
Secondary market
A market where existing mortgage loans are securitized and then bought and sold to other investors
Secondary, or follow-on, offering
A stock offering made by an existing public company
Securities and Exchange Commission (SEC)
The federal agency that supervises and oversees the issuance and exchange of public securities
Securitization
The process of converting an illiquid asset, such as a mortgage loan, into a tradable form, such as mortgage-backed securities
Security deposit
A deposit of money by a tenant to a landlord to secure performance of a lease. It also can take the form of a letter of credit or other financial instrument.
Seisen (seizen)
Possession of real property under claim of freehold estate
Self-administered REIT
When members of the management are employees of the REIT or an entity having essentially the same economic ownership as the REIT
Self-managed REIT
A REIT whose employees are responsible for performing property management functions
Senior classes
With regard to securities, describes the classes with the highest priority to receive the payments from the underlying mortgage loans
Separate account
A relationship where an investment manager or adviser is retained by a single pension plan sponsor to source real estate product under a stated investment policy exclusively for that sponsor
Servicer
An organization that acts on behalf of a trustee for the benefit of security holders
Setback
The distance from a curb, property line or other reference point, within which building is prohibited
Shares outstanding
The number of shares of common stock currently outstanding, less the shares held in treasury
Site analysis
Determines the suitability of a specific parcel of land for a specific use
Site development
The installation of all necessary improvements made to a site before a building or project can be constructed on the site
Site plan
A detailed plan that depicts the location of improvements on a parcel
Slab
The exposed wearing surface laid over the structural support beams of a building to form the floor(s) of the building
Social investing
Investments driven in whole or in part by social or political (non-real estate) objectives. Under ERISA, social investing is economically justified only if proper real estate fundamentals are considered first.
Soft cost
The portion of an equity investment other than the actual cost of the improvements themselves that may be tax-deductible in the first year
Space plan
A graphic representation of a tenant's space requirements, showing wall and door locations, room sizes and sometimes furniture layouts
Special assessment
Special charges levied against real property for public improvements that benefit the assessed property
Special servicer
A firm that is employed to work out mortgages that are either delinquent or in default
Specified investing
Investment in individually specified properties or portfolios, or investment in commingled funds whose real estate assets are fully or partially specified prior to the commitment of investor capital
Speculative space
Any tenant space that has not been leased before the start of construction on a new building
Stabilized net operating income
Projected income less expenses that are subject to change but have been adjusted to reflect equivalent, stable property operations
Stabilized occupancy
The optimum range of long-term occupancy that an income-producing real estate project is expected to achieve after exposure for leasing in the open market for a reasonable period of time at terms and conditions comparable to competitive offerings
Step-up lease (graded lease)
A lease specifying set increases in rent at set intervals during the term of the lease
Straight lease (flat lease)
A lease specifying a fixed amount of rent that is to be paid periodically, typically monthly, during the entire term of the lease
Strip center
Any shopping area comprised of a row of stores but smaller than a neighborhood center anchored by a grocery store
Subcontractor
A contractor working under and being paid by the general contractor, often a specialist in nature, such as an electrical contractor, cement contractor, etc.
Sublessee
A person or identity to whom the rights of use and occupancy under a lease have been conveyed, while the original lessee retains primary responsibility for the obligations of the lease
Subordinated classes
With regard to CMBS, describes those classes with the lowest priority to receive payments from the underlying mortgage loans
Subordination
The process of sharing the risk of credit losses disproportionately among two or more classes of securities
Surety
One who voluntarily binds himself to be obligated for the debt or obligation of another
Surface rights
A right or easement granted with mineral rights, enabling the possessor of the mineral rights to drill or mine through the surface
Survey
The process by which a parcel is measured and its boundaries and contents ascertained
Synthetic lease
A transaction that appears as a lease from an accounting standpoint but as a loan from a tax standpoint
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