Investment assumptions

The Investment tab in Edit Assumptions sets the operating expenses and exit assumptions that turn revenue into returns. Adjust a field, then click Recalculate to refresh the outputs.

Net Operating Income

Field	What it means	Units
NOI Margin / GOP Margin	Choose how operating expenses are entered. See the toggle note below.	toggle
Management Fee	Hotel management fee.	% of Total Revenue
Property Taxes	Annual property tax.	$/key
Insurance	Annual property insurance.	% of Total Revenue
Reserves	Reserve for replacement, set aside each year.	% of Total Revenue

The NOI Margin / GOP Margin toggle controls how net operating income is derived:

GOP Margin — Parafin starts from gross operating profit and subtracts the management fee, property taxes, insurance, and reserves to reach NOI. Use this for a full expense breakdown.
NOI Margin — you enter NOI as a single margin on Total Revenue. Use this for a quick top-down estimate.

The toggle also changes how the Net Operating Income result table reads.

Investment

Field	What it means	Units
Cap Rate at Sale	Capitalization rate used to value the asset at exit; a lower rate means a higher sale price.	%
Selling Costs	Transaction costs at sale, as a share of the sale price.	%

For the outputs these inputs feed, see Investment Returns.

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Investment assumptions

Net Operating Income

Investment

​Net Operating Income

​Investment

Net Operating Income

Investment