AI for Commercial Real Estate Finance: NOI, DSCR, and CRE Underwriting with Claude (2026)

Commercial Real Estate Finance and AI

CRE underwriting requires building the property-level NOI from the rent roll, computing DSCR and LTV, stress-testing occupancy and rent scenarios, and comparing cap rates against market comps. Claude with ClaudeFinLab structures the CRE underwriting model — from rent roll analysis to loan sizing to stressed DSCR — helping lenders and equity investors make faster, better-documented credit decisions.

NOI Computation from Rent Roll

• "Compute stabilized NOI for a 150,000 SF Class A office building: Rent roll — 12 tenants, 130,000 SF leased (87% occupied). Average in-place rent: $38.50/SF. Gross potential rent: 150,000 × $38.50 = $5.775M. Vacancy credit (13% × $5.775M): -$750K. Base rental income: $5.025M. Expense recoveries (NNN tenants — recover pro-rata share of operating expenses): $890K. Other income (parking): $180K. Effective Gross Income: $6.095M. Operating expenses: property tax $620K, insurance $85K, management fee 3% of EGI $183K, maintenance $245K, utilities common areas $120K. Total OpEx: $1.253M. Stabilized NOI: $6.095M - $1.253M = $4.842M."
• "Analyze rent roll concentration risk: Tenant 1 (law firm) 35,000 SF, $42/SF, lease expires 2026 (2 years remaining). Tenant 2 (tech company) 28,000 SF, $36/SF, lease expires 2028. Top 2 tenants = 42% of leasable area. Risk: Tenant 1 lease expiry in 2026 — if not renewed at $42/SF, assume re-leasing at $35/SF (current market) with 6-month downtime. Downtime cost: 35,000 SF × $42/SF × 6/12 = $735K lost rent + 6% leasing commission on new lease. Adjusted NOI post-2026 (worst case no renewal): $4.842M - $735K - leasing cost = $3.9M. DSCR impact?"

Loan Sizing and DSCR

• "Size the CRE loan for this office property: NOI $4.842M. Loan parameters: 60% LTV (appraised value $80.7M based on 6.0% cap rate: $4.842M / 6.0% = $80.7M), so max loan = $80.7M × 60% = $48.4M. DSCR constraint: minimum 1.25x. At 7.0% interest rate (current 10-year fixed CRE), 30-year amortization: annual debt service on $48.4M = [PMT: n=360, i=7%/12] × 12 = $3.87M. DSCR: $4.842M / $3.87M = 1.25x — exactly at the minimum. The LTV and DSCR constraints produce the same loan size — $48.4M. Recommend: size at $46M ($2M below maximum) for conservatism."

Cap Rate Analysis and Property Valuation

• "Value the property using cap rate analysis: NOI $4.842M. Market cap rate comparable transactions: 3 comparable Class A office sales in the same submarket past 12 months: Sale A (180K SF, 88% occupied, cap rate 5.85%), Sale B (120K SF, 82% occupied, cap rate 6.25%), Sale C (200K SF, 95% occupied, cap rate 5.50%). Our property: 150K SF, 87% occupied. Adjust for occupancy (higher occupancy warrants lower cap rate): interpolate to 6.05% cap rate. Value = $4.842M / 6.05% = $80.0M. Sensitivity: at 5.75% cap rate (bull case) = $84.2M; at 6.50% cap rate (bear case) = $74.5M."

CRE Loan Stress Testing

• "Stress test the CRE loan: base case DSCR 1.25x. Stress scenarios: (1) Occupancy drops to 75% (from 87%): effective gross income falls 14% → NOI $4.16M → DSCR 1.07x (below 1.20x covenant — technical default); (2) Interest rate reset (5-year fixed, then floating): if rates rise 200bps at reset, debt service increases $0.97M → DSCR 1.00x — cash flow neutral. (3) Combined (75% occupancy + 200bps rate rise): DSCR 0.87x — property cannot service debt. Identify the minimum occupancy at which DSCR equals 1.0x (breakeven occupancy): solve for occupancy where NOI = annual debt service $3.87M."

Where to Start

Paste the property's rent roll (tenant names, SF, in-place rent, lease expiry) and operating expense schedule to Claude. Ask it to compute the stabilized NOI (with market vacancy assumption) and flag the top 3 concentration risks. From there, apply the lender's cap rate (or ask Claude to benchmark it against provided comps) to get the appraised value, then size the loan at the binding constraint (LTV or DSCR).