The Smart Owner’s Playbook: Using a Refinance to Increase Property Value
Many owners view refinancing as a transaction. Top operators view it as a value-creation strategy.
Here’s how a refinance can materially increase your property’s long-term performance.
1. Reduced Interest Rates Lift NOI Immediately
A lower interest rate is the fastest way to improve NOI, and higher NOI directly increases valuation.
Even a modest rate reduction can increase property value by six or seven figures, depending on the size of the asset.
2. Debt Restructuring Creates Operational Flexibility
Rigid loans cost owners money. Restructuring can provide:
Interest-only periods
Lower payments
Better prepay terms
Longer amortization
More predictable cash flow
This flexibility often gives owners breathing room to execute renovations or stabilize occupancy.
3. Cash-Out Capital Fuels Growth
Leveraging equity through a refinance is a proven strategy for:
Funding renovations
Expanding a portfolio
Repositioning an asset
Settling partner buyouts
Instead of leaving equity trapped in the property, refinancing puts it back to work.
4. Preparing for a Sale
Many owners refinance 12–24 months before a sale because:
The property looks stronger on paper
NOI improvements increase valuation
Cash-out capital can enhance the property further
Smart timing leads to bigger exits.
Helpful Link
CBRE Multifamily Market Outlook → https://www.cbre.com
