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AFFO per Share

Financial glossary · plain-language definition · Specialized Investing

Adjusted Funds From Operations per share -- FFO refined one step further toward true distributable cash by subtracting the recurring capital spending a REIT must make just to maintain its buildings (roofs, HVAC, tenant improvements, leasing commissions) and normalizing straight-lined rent. AFFO is the better measure of the cash actually available to pay the dividend, so the AFFO payout ratio is a key dividend-safety gauge. It is a non-GAAP, company-defined figure with no single standard -- each REIT decides which capital costs to subtract -- so treat cross-company AFFO comparisons with more caution than FFO.

Related terms

Absorption Rate · Allowed Return on Equity · Alternative Investments · Anchor Tenant · Assets Under Management · Book Value per Share

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