# AFFO Calculator – Adjusted Funds From Operations

URL: https://speedycalculator.com/calculators/finance/affo/
Last updated: 2026-10-25

> The AFFO calculator works out a REIT's funds from operations (FFO) and adjusted FFO – net income plus depreciation, minus gains on property sales, then adjusted for straight-line rent and recurring capital expenditure – and AFFO per share.

## Inputs

- Net income
- Depreciation and amortisation
- Losses from property sales
- Gains from property sales
- Straight-line rent adjustment
- Recurring capital expenditures
- Routine maintenance
- Shares outstanding
- Dividend per share

## Results

- Funds from operations (FFO)
- Adjusted funds from operations (AFFO)
- AFFO per share
- AFFO payout ratio

## Formula

```
FFO = net income + depreciation and amortisation + losses on property sales − gains on property sales
AFFO = FFO − straight-line rent adjustment − recurring capex and maintenance
AFFO per share = AFFO ÷ shares
```

## Explanation

Real estate is depreciated on paper while properties often gain value, so REIT net income understates cash earnings. FFO (defined by Nareit) adds depreciation back; AFFO goes further by deducting the money really needed to maintain the properties, giving a better measure of dividend-paying capacity.

### How to use the AFFO Calculator – Adjusted Funds From Operations

- **Net income**
- **Depreciation and amortisation**
- **Losses from property sales**
- **Gains from property sales**
- **Straight-line rent adjustment**
- **Recurring capital expenditures**
- **Routine maintenance**
- **Shares outstanding**
- **Dividend per share**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter net income, depreciation, gains and losses on property sales, rent adjustments, capital expenditure and maintenance, and shares outstanding.

### Tips

- Get a written loan estimate and compare the APR, not just the interest rate.
- Include property tax, insurance, HOA fees and maintenance in your monthly budget.
- A larger down payment lowers the payment and can remove mortgage insurance.
- Rates change daily – use a current quote for the most accurate result.

### Common mistakes to avoid

- Looking only at the monthly payment instead of the total cost of the loan.
- Forgetting closing costs and fees.
- Assuming home prices always rise.

### Inputs explained

FieldWhat to enterNet incomeAmount in your currencyDepreciation and amortisationAmount in your currencyLosses from property salesAmount in your currencyGains from property salesAmount in your currencyStraight-line rent adjustmentAmount in your currencyRecurring capital expendituresAmount in your currencyRoutine maintenanceAmount in your currencyShares outstandingA numberDividend per shareAmount in your currency

### What each result means

- **Funds from operations (FFO)** = [Net income] + [Depreciation and amortisation] + [Losses from property sales] - [Gains from property sales]
- **Adjusted funds from operations (AFFO)** = [Funds from operations (FFO)] - [Straight-line rent adjustment] - [Recurring capital expenditures] - [Routine maintenance]
- **AFFO per share** = [Adjusted funds from operations (AFFO)]÷[Shares outstanding]
- **AFFO payout ratio** = [Dividend per share]÷[AFFO per share]×100

### Example values

How the main result changes when **Net income** changes and everything else stays at the example values above:

Net incomeAdjusted funds from operations (AFFO)60,000,000109,000,00090,000,000139,000,000120,000,000169,000,000150,000,000199,000,000180,000,000229,000,000240,000,000289,000,000

## Worked example

Inputs — Net income: $120,000,000; Depreciation and amortisation: $90,000,000; Losses from property sales: $2,000,000; Gains from property sales: $15,000,000; Straight-line rent adjustment: $6,000,000; Recurring capital expenditures: $18,000,000; Routine maintenance: $4,000,000; Shares outstanding: 80,000,000; Dividend per share: $1.8.

Results — Funds from operations (FFO) = $197,000,000.00; **Adjusted funds from operations (AFFO) = $169,000,000.00**; AFFO per share = $2.11; AFFO payout ratio = 85.21 %.

## FAQ

**What is AFFO?**
FFO adjusted for recurring capital spending and non-cash rent – a REIT's sustainable cash earnings.

**Why not use net income for REITs?**
Depreciation makes net income understate cash flow.

**What is a healthy AFFO payout ratio?**
Below about 85–90% leaves a margin of safety for the dividend.

**What formula does the AFFO Calculator – Adjusted Funds From Operations use?**
FFO = net income + depreciation and amortisation + losses on property sales − gains on property sales.


## Sources

- [Nareit – Funds from operations](https://www.reit.com/)