This Glossary provides definitions of terms related to property and property investing.
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Term and Definition
Bank charges

Costs charged for banking services related to the fund.

Base rent

This term is usually used in relation to retail properties which also pay Turnover rent. So the rental flows can be differentiated between the secure income (Base rent) and risk income (Turnover rent).

Basis point

The measurement of change in the value of an investment, equal to 1/100th of 1%. e.g. 1% equals 100 basis points. If a yield moves from 6% to 6.5%, it is said to have moved by 50 basis points.

Benchmarking / Benchmarking return

The performance measure an investment portfolio compares itself to. This may be the returns of a market index or a more specific target. e.g. Investment Property Databank (IPD) Pooled Property Fund Index or CPI +6% are types of benchmarks.

Beneficial interest

Any interest of value in a property held by a beneficiary who is not necessarily the owner of the legal interest. The beneficiary is entitled to receive the benefits generated by the asset where the asset is legally registered in the name of another party who is typically a Trustee.

Beta

Beta is a quantitative measure of the volatility of a fund or portfolio, relative to the overall market. A beta of 1 equals the market return. For example, a portfolio with a beta of 1.2 might be expected to perform some 20% better than the market when it rises and 20% worse when it falls. Similarly, a beta of 0.5 implies a movement equal to only half the market’s rise or fall. A beta measurement is commonly used to measure the risk level of a particular investment/investment portfolio. See also Alpha.

Blackwater

Water which contains human, food or animal waste and collected through fixtures including toilets, urinals and bidets.

Book depreciation

The amount reserved upon the books of an owner to provide for the retirement or replacement of an asset, as distinguished from accrued depreciation.

Bottom-up analysis

This is the investment style which considers individual assets as opposed to sectors which may be in or out of favour. The opposite to top-down analysis where sectors are considered first and then assets.

Brownfield

A developed site, usually in an urban area, no longer used for the purpose for which it was developed. A brownfield site may be derelict or still partially utilised. e.g. unused railway yards or redundant manufacturing facilities.

Building Code of Australia (BCA)

The national performance-based building code, produced and maintained by the Australian Building Codes Board (ABCB) on behalf of the Australian government and the state and territory governments.

Building commissioning

The process of achieving, verifying, and documenting whether the performance of a building and its various systems meets design intent and the owners' and occupants' operational needs. The process extends through all phases of a project, from concept to occupancy and operation.

Building envelope

Commonly understood as the skin, external walls, glazing, and roofs of a building that encloses interior and/or conditioned spaces and through which thermal energy may be transferred to and from the exterior.

Building Monitoring System (BMS)

Computerised monitoring engineering services, security and other building systems for the purposes of recording, reporting and operational control to maximise safety, security, operational performance and for overall cost minimisation and efficiency. Data generated compares operational status and reports performance of buildings to improve total portfolio performance, maximise occupant productivity, minimise energy use and improve overall efficiency for building owners.

Building systems

Building systems include architectural, mechanical, electrical, fire, hydraulic and control systems, along with their respective sub-systems, equipment and components. All must be commissioned specialists.

Building tuning

Building tuning refers to the ongoing process of adjustment of building systems via their control systems to optimise performance, maintain environmental ratings and continuously improve occupant satisfaction with the building.

Bulky goods centre

A medium to large-sized shopping centre dominated by bulky goods retailers selling furniture, white goods and other homewares and occupying large areas to display merchandise. A small number of specialty shops are also often present. Total GLAR will typically be greater than 5,000 sqm. e.g. Harvey Norman Centre, Alexandria, NSW.

Buy/sell spread

The difference between the entry and exit price of a fund, usually represented by the difference between the allocation and redemption price of units (expressed as a %) as a result of transaction costs incurred in buying and selling the underlying assets in the fund.

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