TTM, or trailing twelve months, is the measurement of a project's financial data for the last 12 months. TTM figures do not always represent the last fiscal year, though they might. It is simply a snapshot of the last 12 months of financial activity. Taking a look at an existing commercial real estate project's TTM and rent roll, is one of the best ways to determine the property's potential profitability.

Investors, lenders, and others often calculate TTM for documents such as income statements, balance sheets, and cash flow statements. TTM for income statements is calculated by adding the last 12 months of income statements together (if income is recorded monthly), the last four quarterly statements (if it's recorded quarterly), or the last two semi-annual statements (if recorded twice a year).

The same goes for cash flow statements. However, balance sheet information can be simply taken directly from the last 12 months of records. This is because balance sheets provide a current "snapshot" of a project's assets, liabilities, and shareholder equity.

Looking at a property's TTM is important for a variety of different property types, including office, self-storage, and multifamily developments. While TTM is a fantastic tool, investors looking for a more recent measurement of a commercial real estate project's finances may want to look at a property's T3, or trailing three months. A T3 looks at the last three months of a property's financial data.

TTM is used to evaluate commercial real estate investments by providing a snapshot of the last 12 months of financial activity. Investors, lenders, and others can use TTM to calculate documents such as income statements, balance sheets, and cash flow statements. Balance sheet information can be taken directly from the last 12 months of records, while income and cash flow statements are calculated by adding the last 12 months of income statements together (if income is recorded monthly), the last four quarterly statements (if it's recorded quarterly), or the last two semi-annual statements (if recorded twice a year).

Looking at a property's TTM is important for a variety of different property types, including office, self-storage, and multifamily developments. Investors looking for a more recent measurement of a commercial real estate project's finances may want to look at a property's T3, or trailing three months. A T3 looks at the last three months of a property's financial data.

The advantages of using TTM to analyze commercial real estate investments are that it provides a snapshot of the last 12 months of financial activity, which can be used to determine the potential profitability of a project. TTM can be calculated for documents such as income statements, balance sheets, and cash flow statements. Balance sheet information can be taken directly from the last 12 months of records, while income and cash flow statements can be calculated by adding the last 12 months of income statements together (if income is recorded monthly), the last four quarterly statements (if it's recorded quarterly), or the last two semi-annual statements (if recorded twice a year). TTM is important for a variety of different property types, including office, self-storage, and multifamily developments.

The main disadvantage of using TTM to analyze commercial real estate investments is that it does not provide a real-time view of a project's financials. TTM looks at the last 12 months of financial data, which may not be reflective of the current market conditions. Additionally, TTM does not take into account any changes that may have occurred in the last three months. For a more up-to-date view of a project's financials, investors may want to look at a property's T3, or trailing three months. A T3 looks at the last three months of a property's financial data.

TTM is a great tool for analyzing commercial real estate investments, as it provides a snapshot of the last 12 months of financial activity. It is especially useful for income statements, balance sheets, and cash flow statements. However, investors looking for a more recent measurement of a commercial real estate project's finances may want to look at a property's T3, or trailing three months. A T3 looks at the last three months of a property's financial data.

The best practices for using TTM to evaluate commercial real estate investments include looking at the last 12 months of income statements, cash flow statements, and balance sheets. Investors should also consider looking at a property's T3, or trailing three months, for a more recent measurement of a commercial real estate project's finances. Additionally, investors should take a look at an existing commercial real estate project's TTM and rent roll to determine the property's potential profitability.

For more information, please see the following sources:

• TTM: Trailing Twelve Months in Commercial Real Estate
• Rent Roll
• Commercial Real Estate Property Types
• Office Building Loans
• Self-Storage Financing
• Multifamily Loans
• T3: Trailing Three Months