Most commercial real estate ROI calculations are wrong because they confuse nominal rent with net yield, and they ignore the capital outlay ramp from the payment plan. Here is a cleaner framework — worked through with current CRC The Flagship numbers.
The six-step framework
Step 1 — The ticket
Super area × rate. For a 700-sqft Individual Shop at The Flagship, starting price is ₹1.78 Cr. Add ~10% for GST, registration and stamp duty → true all-in cost ≈ ₹1.96 Cr.
Step 2 — Annual rent
Guaranteed lease ₹200/sqft/month × 700 sqft × 12 = ₹16.8 Lakhs per year. At The Flagship, this begins from possession day — not six months after you find a tenant.
Step 3 — Gross yield
₹16.8 L ÷ ₹1.96 Cr ≈ 8.6%. Top of the Noida Grade-A commercial range (typically 6-8%) for projects without a structured lease guarantee.
Step 4 — Net yield
Zero-maintenance-cost campus → net ≈ gross. Typical commercial project where the owner pays maintenance → subtract 1-2 percentage points.
Step 5 — Stress test
What if the guarantee lapses at year 8? Check organic market rent. If guaranteed rent is only 10-20% above market, safe. 50% above market = premium may not survive expiry.
Step 6 — Total return
Over the 27-year lease: ₹16.8 L × 27 = ₹4.54 Cr rent on a ₹1.96 Cr investment — ~2.3× on rental alone, before capital appreciation.
Worked example — 700-sqft Individual Shop
- Price
- ₹1.78 Cr headline · ₹1.96 Cr all-in
- Rent/year
- ₹16.8 L
- Gross yield
- ~8.6%
- Net yield
- ~8.6% (zero maintenance)
- 27-year rent total
- ~₹4.54 Cr
- Rental return
- ~2.3× capital
Run the numbers on a specific unit
Current price list, guaranteed lease schedule and the full investment case.