FFO

Definition

Funds From Operations. A financial measure used by REITs to define their operating performance. FFO is calculated by adding depreciation and amortization expenses to earnings. This gives an idea of the REIT's cash performance, which is a better measure of the REIT's performance than earnings, which include (often large) non-cash items.

Use FFO in a sentence

Our ffo was pretty good and I decided to call a team meeting to discuss it with everyone on our staff.

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Our FFO looked better than we expected, and talks of revising quarterly estimates had begun, but nobody wanted to jump the gun on such a thing.

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If you purchase a house that you will be using as a rental property you will want to include FFO in determining if it is a sound investment, often you may believe that you will be receiving $2000 per month profit after paying the mortgage when in fact after including the costs of property management, mortgage insurance, taxes, and upkeep your actual REIT is only $1700.

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cash (or funds) available for distribution (CAD or FAD) adjusted funds from operations