(COCR)

Cash on Cash Return (COCR)

Investor Term:

COCR

Definition:

A cash on cash return (COCR) is a measure of the return on investment (ROI) for a real estate investment, calculated as the annual pre-tax cash flow from the investment divided by the total cash invested. It is expressed as a percentage.

Formula:

COCR = (Annual Cash Flow Before Taxes) / (Total Cash Invested)

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Example:

For example, if an investment property generates $10,000 in annual cash flow before taxes and the total cash invested in the property is $50,000, then the COCR would be 20%. This means that the investor would earn a 20% return on their investment in the property each year.