Glossary

Page Rank

A logarithmic scale based on link equity which estimates the importance of web documents.
Since PageRank is widely bartered Google's relevancy algorithms had to move away from relying on PageRank and place more emphasis on trusted links via algorithms such as TrustRank.

Parking ratio

Dividing the total rentable square footage of a building by the building's total number of parking spaces provides the amount of rentable square feet per each individual parking space.

Partial sales

The sale of an interest in real estate that is less than the whole property. This may include a sale of easement rights, parcel of land or retail pad, or a single building of a multi-building investment.

Partial taking

The taking of part of an owner's property under the laws of eminent domain.

Participating debt

In addition to collecting a contract interest rate, participating debt allows the lender to have participatory equity rights through a share of increases in income and/or increases in residual value over the loan balance or original value at the time of loan funding.

Party in interest

Under ERISA's 2002 Modernization Act: Parties in interest include employers, unions and, in certain circumstances, fiduciaries. It excludes service providers and their affiliates. Fiduciaries would only be parties in interest where they act on behalf of a plan sponsor in entering into a transaction. An affiliate of a party in interest does not include remote affiliates of employers, unions and fiduciaries (e.g., 10 percent owners), as well as employees of such remote affiliates.

Pass-through certificate

Payments of principal and interest from the underlying pool of mortgages are passed through to the holders of the certificates.

Payout ratio

The percentage of the primary earnings per share, excluding extraordinary items, paid to common stockholders in the form of cash dividends during the trailing 12 months.

Penality

Search engines prevent some websites suspected of spamming from ranking highly in the results by banning or penalizing them. These penalties may be automated algorithmically or manually applied.

Pension liability

The total amount of capital required to fund vested pension fund benefits.

Percentage rent

Rent payable under a lease that is equal to a percentage of gross sales or gross revenues received by the tenant. It is commonly used in retail center leases.

Performance

The quarterly changes in fund or account values attributable to investment income, realized or unrealized appreciation, and the total gross return to the investors both before and after investment management fees. Formulas for calculating performance information are varied, making comparisons difficult.

Performance bond

A surety bond posted by a contractor guaranteeing full performance of a contract with the proceeds to be used to complete the contract or compensate for the owner's loss in the event of nonperformance.

Performance measurement

The process of measuring an investor's real estate performance in terms of individual assets, advisers/managers and portfolios. The scope of performance measurement reports varies among managers, consultants and plan sponsors.

Performance-based fees

Fees paid to advisers or managers based on returns to investors, often packaged with a modest acquisition and asset-management fee structure.

Permanent loan

The long-term mortgage on a property.

Plan assets

The assets of a pension plan.

Plan sponsor

The entity that establishes, contributes to and is responsible for the administration of an employee benefit plan, often used interchangeably to describe staff who administer the plan and trustees or investment board members who govern it.

Plat

Map of a specific area, such as a subdivision, that shows the boundaries of individual lots together with streets and easements.

Portfolio management

The portfolio management process involves formulating, modifying and implementing a real estate investment strategy in light of an investor's broader overall investment objectives. It also can be defined as the management of several properties owned by a single entity.

Portfolio turnover

The average time from the funding of an investment until it is repaid or sold.

Power of sale

Clause inserted in a mortgage or deed of trust giving the mortgagee (or trustee) the right and power, upon default in the payment of the debt secured, to advertise and sell the property at public auction.

Preferred shares

Stocks that have prior claim on distributions (and/or assets in the event of dissolution) up to a definite amount before the common shareholders are entitled to anything. As a form of ownership, preferred shareholders fall behind all creditors in dissolutions.

Preleased

Space in a proposed building that has been leased before the start of construction or in advance of the issuance of a certificate of occupancy.

Prepayment rights

Rights given to the borrower to make partial or full payment of the total principal balance prior to the maturity date without penalty.

Price to earnings ratio

This ratio is calculated by dividing the current share price by the sum of the primary earnings per share from continuing operations, before extraordinary items and accounting changes, over the past four quarters.

Primary issuance

The initial financing of an issuer.

Prime space

Typically refers to first-generation space that is available for lease.

Prime tenant

The major tenant in a building, or the major or anchor tenant in a shopping center.

Principal payments

The return of invested capital to the lender.

Private placement

A sale of a security in a manner that is exempt from the registration rules and requirements of the Securities and Exchange Commission. An example would be a REIT directly placing an issue of stock with a pension fund.

Private REIT

An infinite- or finite-life real estate investment company structured as a real estate investment trust. Shares are placed and held privately rather than sold and traded publicly.

Pro rata

In the case of a tenant, the proportionate share of expenses for the maintenance and operation of the property.

Production acres

The area of land that can be used in agriculture or timber operations to produce income, not including areas used for crop or machinery storage, or other support areas.

Prohibited transaction

ERISA defines the following transactions as prohibited between a pension plan and a party in interest: the sale, exchange or leasing of any property; a loan or other extension of credit; and the furnishing of goods or services. Other prohibited transactions include the transfer of plan assets to a party in interest or use of plan assets by a party in interest, and the acquisition of employer real property in excess of limits set by ERISA.

Prudent man rule

The standard to which a fiduciary is held accountable under ERISA. "Act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of a like character and with like aims."

Public-Private Partnership (P3)

According to the National Council for Public Private Partnerships, a Public-Private Partnership (P3) is a contractual agreement between a public agency and a private sector entity. Through this agreement, the skills and assets of each sector (public and private) are shared in delivering a service or facility for the use of the general public. Each party shares in the risks and rewards potential in the delivery of the service and/or facility.

Punch list

An itemized list documenting incomplete or unsatisfactory items after the contractor has notified the owner that the tenant space is substantially complete.