capitalization rate Meaning in the Cambridge English Dictionary Cambridge dictionaries logo

Meaning of “capitalization rate” in the English Dictionary

"capitalization rate" in Business English

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capitalization ratenoun [C]

(UK also capitalisation rate) uk   us   (also cap rate)
ACCOUNTING, FINANCE the ​rate of ​interest used to ​calculate the ​presentvalue of an ​investment or ​property that will ​provide an ​income in the future: Investors use the ​caprate to ​estimate the ​purchaseprice for different ​types of income-producing ​properties.
(Definition of capitalization rate from the Cambridge Business English Dictionary © Cambridge University Press)
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