DEFINITION of 'Cash Available For Distribution - CAD'

A real estate investment trust's (REIT's) cash on hand that is available to be distributed as shareholder dividends. The value is calculated by finding the funds from operations (FFO) and subtracting recurring capital expenditures. Also referred to as funds available for distribution (FAD).

BREAKING DOWN 'Cash Available For Distribution - CAD'

Cash available for distribution is the difference between funds from operations and recurring expenses. Recurring capital expenses that are typically subtracted from the FFO to determine the CAD value include replacing building roofs, HVAC system repairs, resurfacing of parking lots and other significant routine maintenance. The cash available for distribution and the funds from operations value are both ways that investors can help measure a particular REIT's earnings and potential.

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RELATED FAQS
  1. What security should I use funds from operations for?

    Find out what sorts of securities are evaluated using funds from operations. Learn how FFO is calculated and why it is relevant ... Read Answer >>
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    Find out more about the funds from operations to total debt ratio and how to use the FFO to total debt ratio to assess a ... Read Answer >>
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