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F Terms

Furniture, Fixtures & Equipment – Personal or business property which is used in the real property but which is not valued as part of the real property.

Facility Space – The floor area in a hospitality property dedicated to operating departments such as restaurants, bars, health clubs, coffee shops and gift shops that serve the guests or the general public in a way that is not directly related to room occupancy.

Fair Housing Act – The Federal law that prohibits discrimination in all facets of the home buying process on the basis of race, color, national origin, religion, sex, familial status, or disability.

Fair Market Value (FMV) – The amount at which a property or asset could be bought or sold between a willing buyer and willing seller – arms-length transaction, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts or being well informed of all material facts.  Not a forced or liquidation sale amount.

First Refusal, or Right Of First Refusal – A lease or contract right providing a tenant or buyer the first opportunity to buy a property or lease additional space in a property.

Fee Simple – The legal term defining complete ownership of real property without any limitations or conditions. The ownership of the property goes to the owner’s heirs upon their death intestate.

First-Generation Space – Generally refers to rental/leased space that has not been occupied by a tenant before.

Fixed Costs – Costs that are not affected by the level of sales or production.

Fixture – Personal property that turns into real property when attached in a permanent manner to real estate.

Flat Fee – A manager’s fee for managing a portfolio of real estate assets, usually stated as a flat percentage of the asset’s gross or net value, or invested capital.

Flex Space – A building that provides a changeable or flexible configuration allowing occupants or tenant’s flexibility in apportioning the amount of office or showroom space to the manufacturing, warehouse, or distribution space.

Float – A financial term defined as using funds generated as a result of timing differences in the banks’ check-clearing system.  This is common component in the insurance industry.

Flood Hazard Zone – Federal law defines this requirement as a land area that might experience damage from flooding for the purposes of insuring properties.  Lenders taking an interest in real property are compelled, by the National Flood Insurance Reform Act of 1994, to complete FEMA’s flood hazard determination form and retain a record of the form.  A lender is required to have flood insurance and have notice requirement obligations for any collateral property located in a designated flood hazard area.

Floor Area Ratio (FAR) – The ratio of the gross square footage of a building to the square footage of the land or defined lot on which it is situated.

Force Majeure – A natural force that cannot be controlled by the parties to a contract and prevents them from fulfilling the obligations of the contract. “Acts of God”, such as lightning, flood, storm, freezing or a hurricane, or “acts of man” such as a strike, fire, nuclear first strike or war.

Full-Service Rent – Rent that includes or incorporates all of the first year’s operating expenses and real estate taxes. Tenants are generally still responsible for any increases in operating expenses over base year amounts.

Funds From Operations (FFO) – A financial ratio that compares the cash generated by a company’s real estate portfolio relative to its total operating cash flow. FFO is equal to net income plus depreciation and amortization, less gains (or losses) from debt restructuring and property sales.

Future Proposed Space – Space in a proposed commercial development upon which the building has not yet started or where date for construction start has not been set.  May refer to the phases of a multi-phase project that are as yet not built (an example is sometime one can see a dirt lot with a sign that says “Build To Suit” or “Future Home of ABC Company”).

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