Forced appreciation

Increasing property value through operations or capital improvements rather than market movement.

Two flavors. (1) Operational: raise rents, cut expenses, fill vacancy. Commercial property is valued at NOI ÷ market cap rate, so every $1 of NOI added at a 6% cap creates ~$17 of value. (2) Capital: rehab, add a unit, change zoning. The BRRRR strategy is built on forced appreciation — buy distressed, rehab, refi at the new value, pull cash out. Single-family forced appreciation works less cleanly because residential is valued on comps, not NOI.