Shafiq Hirani CCIMReal Estate Advisor, REMAX Distinctive · Real Estate Advisor at RE/MAX Distinctive Commercial | Washington, DC | Your Guide To Profitable Real Estate Ventures

Unlock Real Estate Loans: Focus on NOI, Not Capital #shorts

22 Aug 2026 · 2 min

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In this short video, Shafiq Hirani CCIM argues that when underwriting real‑estate loans, lenders should prioritize a property’s Net Operating Income (NOI) and coverage ratio rather than the borrower’s capital availability or broader monetary policy. He cites recent macro‑economic data—July inflation at 3.4% (core 2.5%), modest rent growth of 1.3% for apartments, declining hourly earnings, rising grocery and restaurant prices, and a loss of 40,000 leisure‑hospitality jobs—to illustrate the pressures on tenants and cash‑flow risk. Hirani stresses that capital is not the limiting factor; the coverage ratio, driven by actual income and expense management, determines loan size. He offers concrete tactics for owners to boost coverage: rebid insurance, appeal property assessments, renegotiate auto‑renewed contracts, and recover utility costs, emphasizing that every dollar saved improves the loan’s underwriting metrics.

Chapters

Capital availability does not move that number. The Fed does not move it. Only your building's income moves it, which is why every conversation on this channel keeps coming back to NOI and why it is not a slogan. It is the underwriting standard. Quickly on the tenant side, because it affects the same equation. July inflation came in at 3.4%, with core at 2.5%, and analysts at Marcus& Millichap noted those readings could modestly ease pressure on the Fed to raise rates. That is encouraging, but look at the rest. Apartment rents inside the inflation data grew just 1.3%, down from 2.1% the year before. Real average hourly earnings declined. Grocery prices rose 2.7%. Restaurants 3.4%, and leisure and hospitality shed 40,000 jobs in July. If your tenants work in that sector, watch your collections this fall. So here is the bottom line: capital is not your constraint. Your coverage ratio is. Rent growth won't fix it for you at 1.3%, which leaves the expense side and the income you are already entitled to but not collecting. Rebid your insurance, appeal your assessment, rebid the contracts that have auto-renewed for years, recover the utility costs you are absorbing. Every dollar you move improves your coverage ratio, and coverage determines the size of your loan.