In this episode of the Ironclad Underwriting Podcast, Jason Williams and Frank Patalano take a deep dive into expense ratios and explain why understanding operating expenses is essential when evaluating a commercial real estate investment. They discuss how property age, class, location, and management can impact expenses and why investors should avoid relying on blanket assumptions when underwriting a deal. The conversation also explores payroll, reserves, utilities, property management, controllable and uncontrollable expenses, and the importance of carefully reviewing a property’s financials.

Topics Covered

• Understanding what an expense ratio is and how it is calculated
• Why mortgage payments are not considered operating expenses
• How property age and vintage affect operating expenses
• The ...