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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.

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Net Operating Income

FieldWhat it meansUnits
NOI Margin / GOP MarginChoose how operating expenses are entered. See the toggle note below.toggle
Management FeeHotel management fee.% of Total Revenue
Property TaxesAnnual property tax.$/key
InsuranceAnnual property insurance.% of Total Revenue
ReservesReserve 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.

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Investment

FieldWhat it meansUnits
Cap Rate at SaleCapitalization rate used to value the asset at exit; a lower rate means a higher sale price.%
Selling CostsTransaction costs at sale, as a share of the sale price.%
For the outputs these inputs feed, see Investment Returns.