Author’s note: The term cash-in is not used in the relevant literature. The following definition therefore includes ideas developed independently by the author. They can gladly be supplemented by CORPUS SIREO’s “expert opinion”.
All cash income arising within a period is taken into account in cash flow as the cash-in.
In the property industry a distinction is made between the direct and the indirect cash flow.1
Cash-in in direct cash flow:
The direct cash flow takes into account all the current income and expenses directly associated with the property and the acquisition investment. The following cash income is predominantly considered part of the cash-in in this context:
- Rental income
- Lease income
- Other income in connection with the property
- Advances on additional costs
- Sales proceeds
Cash-in in indirect cash flow:
The excess income derived from the direct cash flow can be used for the indirect cash flow. This includes, for example, borrowing costs, repayment, taxes or reinvestment in financial alternatives.2 In the indirect cash flow the cash-in includes the following cash income:
- Interest income from securities transactions
- Gains from securities transactions
- Sale of fixed assets (e.g. partial sales)
- Tax refunds
In the property industry the following measures also result in a cash-in:
- Optimisation of space allocation
- Renegotiation of existing leases
- Cost optimisation3
These items are indirectly taken into account in cash flow as positives throughout the holding phase of a property.